Audit opinion and earnings management: Empirical evidence from Vietnam

This paper aims to explore the interaction between earnings management and audit opinions in context of Vietnam – an emerging country. For this purpose, two regressions were developed with sample consists 1,294 firm-years period from 2018 2020. The first regression model uses Audit Opinion as dependent variable, Discretionary Accruals (DA) independent other 8 controlling variables. results demonstrate that influence opinion, significantly at 0.1 level study year. means auditor’s probability issuing modified opinion is positively associated attendance a Big 4 companies. Another tests auditor size (measured by Auditor) on Accruals) 10 Surprisingly, not statistically significant confirms appearance companies does affect nexus profit case Vietnamese listed suggest firms tend have higher requirements for true-and-fair information client’s financial statements often tendency issue when material errors, or it impossible collect sufficient evidence. finding may enhance decision-making process users various circumstances. AcknowledgmentsThis funded National Economics University (NEU), Vietnam. authors thank anonymous reviewers their contributions NEU supporting study.