Abstract
We conducted an empirical analysis to verify the relationship between companies’ ownership structures and earnings management. Our sample included 480 nonfinancial companies listed on Vietnam’s Ho Chi Minh Stock Exchange and Hanoi Stock Exchange from 2012 to 2017, and our explanatory variables included several ratios, such as the controlling shareholders’ stake, management ownership stake, state-owned stake, and foreign ownership stake, which represent different ownership structures. We examined the effects of these ratios on earnings management. Our results suggested that earnings management has a significant linear relationship with the state-owned and foreign ownership stakes. Our results can enhance the understanding of the role of companies’ sustainable ownership structures in limiting earnings management, and they can contribute to future studies of the relationship between earnings management and corporate social responsibility and sustainability reporting assurance practices that focus on corporate ownership structures.
Highlights
To develop in a market economy system, companies must be able to produce and operate successfully
We found no evidence that a higher management ownership stake worsens profit-adjusting behavior, and, hypothesis 2 was rejected
We analyzed the effect of the ownership structure on earnings management using the financial statements of companies listed on the Ho Chi Minh Stock Exchange and the Hanoi Stock Exchange
Summary
To develop in a market economy system, companies must be able to produce and operate successfully. The second stage (1996–1998) began on 7 May 1996 under Decree 28/1996/ND-CP, and 25 state-owned enterprises were privatized as a result. These two stages were so inefficient that the government enacted Decree 44/1998/ND-CP on 29 June 1998. This decree was regarded as Vietnam’s first legal framework for privatization, and it provided a clear framework for privatizing state-owned enterprises. In Vietnam, privatization is considered one of the most important policies for economic revolution because the number of enterprises with only state-owned capital was significantly reduced from more than 12,000 in the 1990s to 595 in 2018 as a result of this process
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
