• Lê Thị Hoài Anh "Trường Đại học Kinh tế Huế"
  • Lê Thị Nhật Linh "Trường Đại học Kinh tế Huế"
  • Vũ Thành Huy "Trường Đại học Kinh tế Huế"


This paper examines the effect of corporate governance mechanism on earnings management of 130 enterprises traded on Ho Chi Minh Stock Exchange (HOSE), Vietnam in 2014. Earnings management is measured by discretionary accruals and corporate governance is characterized by the CEO duality, board size and board independence. Based on this study, recommendations are made to the policy-makers and standard-setters to contribute to limiting this practice in Vietnamese context. To achieve this objective, an empirical analysis is conducted by using the multivariate regression model. The results indicate that while CEO duality and board size are positively correlated with the extent of earnings manipulation, there is no association between board independence and this variable.


Nguyen Cong Tam (2014), Accounting and Auditing in Business, Ho Chi Minh National University Publisher, Ho Chi Minh City.

Pham Thi Bich Van (2012). Corporate Governance and Earnings Management: An empirical study of firms listed on HOSE. Journal of Science and Banking Education, 127, 58-66.

The Regulation on Corporate Governance applying to firms listed on stock exchanges, issued according to the Resolution 12/2007/QD-BTC.

VACPA. (2011). Retrieved from

Vietnam News. (2012). Retrieved from

Stock Investment. (2015). Retrieved from

HOSE. (2014). Retrieved from

HNX. (2014). Retrieved from

Ahmed, S. (2013). Board of Directors characteristics and earnings management in Malaysia. Paper presented at the 3rd Annual International Conference on Accounting and Finance, Selangor, Malaysia.

Beasley, M.S. (1996). An empirical analysis of the relation between the board of director composition and financial statement fraud. Accounting Review, 71(4), 443-455.

Bergstresser, D. & Philippon, T. (2005). CEO incentives and earnings management. Journal of Financial Economics, 80(3), 511-529.

Charfeddine, L., Riahi, R., & Omri, A. (2013). The determinants of earnings management in developing countries: A study in the Tunisian context. The IUP Journal of Corporate Governance, 12(1), 35-49.

Elias, R. Z. (2002). Determinants of earnings management ethics amongst accountants. Journal of Business Ethics, 40(1), 33-45.

El-Manzalawy, S. M. (2014). Earnings management and its impact on the stock prices of publicly listed companies (Doctoral dissertation). Maastricht School of Management, Maastricht, The Netherlands.

Francis, J. R. & Wang, D. (2008). The joint effect of investor protection and Big 4 audits on earnings quality around the world. Contemporary Accounting Research, 25(1), 157-191.

Graven, A. (2009). The effect of board and audit committee characteristics on real earnings management: Do boards and audit committees play a role in its constraint? Working paper. Culverhouse School of Accountancy, Tuscaloosa.

Jaggi, B., Chin, C., Lin, H., & Lee, P. (2006). Earnings forecast disclosure regulation and earnings management: evidence from Taiwan IPO firms. Review of Quantitative Finance and Accounting, 26 (3), 275-299.

Jensen, M.C & Meckling, W.H. (1976). Theory of the Firm: Managerial Behavior, Agency Cost and Ownership Structure. Journal of Financial Economics, 3(4), 305-360.

Kim, K.A. & Nofsinger, J.R. (2004). Corporate Governance. Prentice Hall, Englewood Cliffs.

Ronen, J. & Yaari, V. (2008). Earnings management: Emerging insights in theory, practice, and research. Springer, New York, USA.

Sarkar, J., Sarkar, S., & Sen, K. (2014). Board of directors and opportunistic earnings management: Evidence from India. Journal of Accounting, Auditing & Finance, 23(4), 517-551.

Schipper, K. (1989). Commentary on Earnings Management. Accounting Horizons, 91-102.

Stock, J. H. & Watson, M. M. (2012). Introduction to econometrics (3rd ed.). Pearson, London, England.

Visvanathan, G. (2008). Corporate governance and real earnings management. Academy of Accounting and Financial Journal, 12(1), 9-22.

Xie, B., Davidson, W.N. & Dadalt, P. (2003). Earnings management and corporate governance: The role of board and the audit committee. Journal of Corporate Finance, 9(3), 295-316.

Young, S. (1998). The determinants of managerial accounting policy choice: Further evidence for the UK. Accounting and Business Research, 28(2), 131-143.

Yermack, D. (1996). Higher market valuation of companies with a small board of directors. Journal of Financial Economics, 40(2), 185-211.

Zgarni, I., Halioui, K., & Zehri, F. (2014). Do the characteristics of board of directors constrain real earnings management in emerging markets? Evidence from the Tunisian context. The IUP Journal of Accounting Research & Audit Practices, 13(1), 46-61.





Journal of Economics and Development