Quality of Financial Statements, Financial Constraints, And Investment Efficiency: Evidence in Vietnam

Faculty of Accounting & Auditing, Hanoi University of Industry, Vietnam.
School of Banking and Finance, National Economics University, Vietnam.

ABSTRACT

The study aims to analyze the impact of the quality of financial statements (FRQ) and financial constraints on the investment efficiency of companies listed on the Ho Chi Minh Stock Exchange (HOSE) and Hanoi Stock Exchange (HNX) from the period of 2010 to 2019. To ensure the stability of the model, this paper will measure FRQ in 5 different methods that were used by many previous studies. The results show that FRQ is positively correlated with investment efficiency, meaning that better FRQ will increase investment efficiency. When examining FRQ with financial constraints. The authors also found the sensitivity between FRQ and financial constraints in reducing investment efficiency. This result can help financial managers to see the role of financial statements quality in relation to financial constraints and investment efficiency of Vietnamese enterprises.

Keywords: Earnings quality , Financial constraints , Investment efficiency

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DANG H N & NGO X T. Quality of Financial Statements, Financial Constraints, And Investment Efficiency: Evidence in Vietnam. Journal Of Organizational Behavior Research 2020;5(2):99-113

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