Dang Ngoc Hung

The paper studies the effects of information reporting in financial statements on values of Vietnamese firms. The study uses panel data with 1,070 observations from 214 firms, which are listed in the stock market of Vietnam in the period from 2012 to 2016. Multiple regression results show that the growth, firm size, profitability, auditing quality and timelineness are positively related to firm values, whereas the capital structure, auditing explanation negatively affect that indicator. The paper also indicates the inconsistency in measuring firms’ value by different measures including EV, Tobin’s Q or share price. Moreover, the research results reflect that measuring firms’ value by EV is more appropriate. The results of empirical research are instructive for enterprises to improve the usefulness of information in financial statements, thereby enhancing enterprises’ values.

Determining the capital and cash holdings pattern is among the most critical decisions of firm executives. This study investigates the link between cash holdings and capital structure to help executives consider the best pattern of capital and cash. The study collected a sample of 5,747 observations from public companies in Vietnam during 2019–2022 and employed the panel data regression method for analysis. The findings demonstrate a correlation between capital structure and cash holding ratio that is statistically significant. However, these relationships are inconsistent between the cash holdings and each component of the capital structure. Current debt and total debt ratios have a positive and linear association with cash holdings, while non-current debt ratio has a negative and nonlinear association. The study highlights a heterogeneous association of the cash holding ratio with three proxies of debt structure. The results reveal that, during COVID-19, the effects of the non-current debt ratio on cash holding and of cash holding on the current debt ratio have no statistical significance.

Type of the article: Research Article

This study examines the impact of financial reporting quality on firm value in the emerging market of Vietnam and tests the moderating role of financial constraints. Using a panel dataset of 5,654 firm-year observations from non-financial companies listed on the Vietnam Stock Exchange over the period 2016–2024 (excluding firms in the financial, banking, and insurance sectors, as well as observations with missing data or extreme outliers), and applying accrual-based measurement models, the empirical results reveal a finding that contrasts with traditional theory of the direct relationship: financial reporting quality negatively affects firm value, implying that greater transparency eliminates overly optimistic market valuations. However, the core contribution of the study lies in demonstrating the conditional nature of this relationship through signaling theory, whereby financial constraints act as a positive moderator that reverses the effect of financial reporting quality. Specifically, for firms facing substantial financial frictions, improving information quality becomes an important mechanism for reducing the cost of capital and enhancing valuation. Accordingly, the study resolves the theoretical gap concerning inconsistent prior evidence and confirms that the value of transparency is concentrated primarily among firms with limited access to external financing.