BANKING ACADEMY FACULTY OF ACCOUNTING – AUDITING -----***----- GRADUATION THESIS TOPIC: DETERMINANTS OF ACCOUNTING INFORMATION QUALITY AT COMMERCIAL BANKS IN HANOI Student name : Nguyen Chau Anh Class : K23CLC-KTA Course : 2020 - 2024 Student ID : 23A4010032 Supervisor : Assoc.D Le Thi Thu Ha Ha Noi, May 2024 DECLARATION I hereby declare that this thesis has been constructed solely by myself, and it has not been included in whole or in part, in any dissertation to submit for a degree or professional qualifications. The data in the thesis is truthful and research results have never been published in any previous research paper. I affirm that any relevant material given within this thesis has been cited where reference has been made to the work of others. I take full responsibility for any fraud or dishonesty in this research.
Hanoi, May 8, 2024 Student Nguyen Chau Anh i ACKNOWLEDGEMENTS I would like to send my deepest appreciation to the lecturers in Accounting & Auditing faculty in Banking Academy for imparting valuable knowledge throughout my learning process at university. Especially, I would like to convey my sincere gratitude to Professor. Le Thi Thu Ha for her considerable support and assistance in the completion of my research. Your advice and suggestions were really helpful to me during the research’s completion.
I would also like to thank the board of directors and employees at Vietnam Bank for Agriculture and Rural Development (Agribank) - Cau Giay Branch, for providing me with this wonderful opportunity and dedicated guidance during my internship. Thanks to that, I have a chance to acquire new knowledge and accumulate practical work experience. The completion of the project would not have been possible without their help and insights. The research is conducted in a limited period of time so there will be drawbacks exist, I hope to receive your valuable comments so that I can improve my work and acquire more knowledge in this field.
ii TABLE OF CONTENTS DECLARATION. ii LIST OF ABBREVIATIONS.vi LIST OF TABLES. vii LIST OF FIGURES. The rationale for the research.
Research objects and and research scope. Contribution of the research. The structure of the research. LITERATURE REVIEW ON THE DETERMINANTS OF ACCOUNTING INFORMATION QUALITY.
THEORETICAL FRAMEWORK ON THE DETERMINANTS OF ACCOUNTING INFORMATION QUALITY AT COMMERCIAL BANKS IN HANOI. Theoretical basis of accounting information. Definition of accounting information. Definition of quality.
Definition of quality of accounting information. Theories on the impact of factors on the quality of accounting information. Asymmetric information theory. Quality of human resource.
Level of compliance to accounting law and policies. DATA AND METHODOLOGY FOR EXAMINING THE DETERMINANTS OF ACCOUNTING INFORMATION QUALITY AT COMMERCIAL BANKS IN HANOI. Accounting information quality scale. Testing the reliability of scale.
EFA exploratory factor analysis. Multivariate regression analysis. RESEARCH RESULTS OF THE DETERMINANTS OF ACCOUNTING INFORMATION QUALITY AT COMMERCIAL BANKS IN HANOI. Testing the reliability of research model.
Testing results for dependent variables. Testing results for independent variables. EFA exploratory factor analysis. Regression analysis results.
Testing hypothesis of binary variable. Testing the correlation between quantitative independent and dependent variables. Testing the independence assumption. Regression analysis results.
Testing the normality of residuals on regression model. Testing the hypotheses. CONCLUSIONS AND RECOMMENDATIONS TO IMPROVE THE QUALITY OF ACCOUNTING INFORMATION AT COMMERCIAL BANKS IN HANOI. Conclusions of research results.
Recommendations to improve the accounting information quality. Level of compliance to accounting law and policy. Quality of human resource. Limitations of the research.
Suggestions for future research .68 APPENDIX 2: RESULTS OF ANALYZING BY SPSS .77 v LIST OF ABBREVIATIONS ABBREVIATIONS MEANING AGRIBANK Vietnam Bank for Agriculture and Rural Development APEC Asia-Pacific Economic Cooperation AICPA American Institute of Certified Public Accountants CEO Chief Executive Officer CFA Chartered Financial Analyst EFA Exploratory Factor Analysis FASB Financial Accounting Standards Board IASB International Accounting Standards Board IFRS International Financial Reporting Standards IPSASB International Public Sector Accounting Standards ISO International Organization for Standardization KMO Kaiser-Meyer-Olkin MB Bank Military Commercial Joint Stock Bank OLS Ordinary Least Square PLS Partial least squares PLS-SEM Partial least squares structural equation modeling SAP Government Accounting Standards SMEs Small and Medium Enterprise SKPD Regional Work Unit Techcombank Vietnam Technology and Commercial Joint Stock Bank VAA Vietnam Federation of Accountants and Auditors VAS Vietnam Accounting Standards Joint Stock Commercial Bank for Foreign Trade of Vietcombank Vietnam WTO World Trade Organization vi LIST OF TABLES TABLES PAGE Table 1. Summary of previous international research on the impact on 9 factors on accounting information quality Table 1. Summary of previous Vietnamese research on the impact on 12 factors on accounting information quality Table 3. Accounting information quality measurements - Relevance 25 Table 3.
Accounting information quality measurements - Reliability 26 Table 3. Accounting information quality measurements - 26 Comparability Table 3. Accounting information quality measurements - 27 Understandability Table 3. Factors measurements 28 Table 4.
Table of evaluating the reliability the scale of dependent 39 variables Table 4. Table of evaluating the reliability the scale of independent 41 variables Table 4. KMO and Barlett's Test for Independent variables (1) 42 Table 4. KMO and Barlett's Test for Independent variables (2) 44 Table 4.
Rotated component matrix of independent variables (1) 45 Table 4. KMO and Barlett's Test for Independent variables (2) 45 Table 4. Factors and Total variance explained of independent variables 47 (2) Table 4. Rotated Component matrix of independent variables (2) 48 Table 4.
Results of independent Samples T-test of Stock listing factor 49 vii Table 4. Results of Pearson test for correlation between variables 50 Table 4. Results of Spearman test for homoscedasticity 51 Table 4. Results of testing for d value (Durbin Watson) 52 Table 4.
Results of testing multicollinearity of independent variables 52 Table 4. Results of F test 53 Table 4. Summary of results of testing research hypotheses 55 viii LIST OF FIGURES FIGURES PAGE Figure 3. The model of the relationship among variables 31 Figure 4.
Survey sample statistics by gender 37 Figure 4. Survey sample statistics by position 38 Figure 4. Survey sample statistics by working experience 38 Figure 4. Diagram of frequency distribution of standardized residuals 54 Figure 4.
Predictor Plot of regression standardized residuals 54 ix INTRODUCTION 1. The rationale for the research In the era dominated by the information, the quality of information is of top concern for most organizations. Information is the key factor to gain success, to enhance competitive ability, to create value and to provide services to customers. Ruzevicius & Gedminaite in 2007 has pointed out that business performances depend on information’s quality and these organizations consider it as a complementary element to assist the management process and one of the core factors of organizational management.g Accounting information is regarded as a main part of management information, managing a company's financial resources.
It is used to support the users to make beneficial decisions. Therefore, information’s quality is a necessary factor for investors to create an efficient market and ensure the ability to make effective business decisions. Commercial banks refer to the financial institutions that carry out banking operations and other business activities under this law for profit according to Article 4 (3) of Law on credit institutions 2010. Besides their main banking activities such as taking deposits, issuing credits, borrowing loans…, commercial banks also take part in the monetary market, providing foreign exchange services and derivatives.
Thus, high quality accounting information is required since the users of accounting information are of diverse qualifications, following and recording accounting entries are facing difficulties during the process of changing operating model, and disclosure is more stringent compared to that of conventional businesses. Hence, quality of accounting information will contribute a major part in the intended users’ decisions in using commercial banks services. Vietnam now has officially joined regional and international economic institutions such as APEC, WTO…the requirements to improve the information quality is becoming increasingly vital. However, enterprises still encounter difficulties in accessing accounting information on financial reports of public 1 administration units.
Thus, this makes it challenging to analyze, evaluate the operation of these units. This could result in the use of the state budget for improper purposes and regulations, causing waste and even corruption. Regarding the role and state of accounting information quality in organizations, it is acknowledged that this subject is present largely in businesses and is one of the determining factors in the developing process of corporations in the economic economy. Given the importance and urgency of the research matter, the author chooses the topic “Determinants of accounting information quality at commercial banks in Hanoi '' to investigate the impact of these factors mentioned above.
The results of this research will bring a right view about the role of factors as well as the recommendations to enhance the quality of accounting information. Literature review Dwi Winarni et al (2020) investigates External and Internal institutional pressure factors effects on the accounting information quality in Indonesia, the author conducted this research by analyzing these factors above by taking samples of the population in the SKPD in Sleman Regional Government. The factors being experimented are external institutional factors such as coercive isomorphism pressure – pressure originated from stakeholders and regulations, and internal factors which are management commitment and human resources. For the measurement of quality of financial information, the authors used four indicators namely relevance, reliability, comparability and understandability and PLS as a tool in this study.
This work uses quantitative methods with survey questionnaires starting from April 23, 2018 to May 5, 2018 with 88.54% respondents received and 11. The results suggested the positive relationship between external and internal institutional pressure on the quality of accounting information, which are shown by the T-statistics value of 6. (2018) determines information is always considered essential and forms the core of any organization. High quality information plays a vital role in fulfilling the requirements and minimizing the risks 2 related to the decision making process of users.
This research is conducted to explore factors and how they affect the information quality in the Malaysian public sector. The authors propose 13 hypotheses to clarify the correlation between the factors impact on the information. Data is collected through questionnaires distributed from May to September 2017, a total of 273 valid survey answers were received then being analyzed using the PLS-SEM. Outcomes suggest that there are 10 factors that are proved to have influence on the data quality including: (1) continuous improvement, (2) top management commitment, (3) information supplier management, (4) policy, (5) innovation, (6) employee involvement, (7) teamwork, (8) training, (9) customer focus, (10) record and information management.
The study also suggests that organizational leadership should focus on the 10 factors that are proven to affect the information quality to improve the quality management in the organizations, thereby enhancing the quality of the public sector. Do Nguyen Minh Chau (2016) aims at finding factors that have impacts on information quality on financial statements in public educational institutions in Ho Chi Minh City. This research adopts mixed methods, in which the qualitative method determines the factors and the quantitative measures the influence of these elements on financial statements quality. The research model includes 7 factors: regulatory environment, economic environment, cultural environment, political environment, accounting information system, abilities of managers and employees qualifications.
The factors mentioned above explain 71.2% of the variance of information quality on financial reports, the other 28.8% accounted for the factors that are not discussed in this study. Pham Quoc Thuan (2016) enquiries about the factors that have effects on the information quality on financial statements in enterprises in Vietnam. The author uses qualitative and quantitative methods to construct the model of 10 factors: stock listing, external audit, training, governance support, accounting software quality, the efficiency of internal control systems and employees qualifications. The sample size is 292 non-financial enterprises, in which 269 are appropriate.