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Effects of leadership and accounting capacity on accountability through the quality of financial reporting by public organisations in Vietnam

Yen Thi Tran (School of Accounting, University of Economics Ho Chi Minh City, Ho Chi Minh City, Vietnam)
Nguyen Phong Nguyen (School of Accounting, University of Economics Ho Chi Minh City, Ho Chi Minh City, Vietnam)
Trang Cam Hoang (Faculty of Finance and Banking, Ton Duc Thang University, Ho Chi Minh City, Vietnam)

Journal of Asia Business Studies

ISSN: 1558-7894

Article publication date: 8 February 2021

Issue publication date: 8 June 2021

691

Abstract

Purpose

By drawing on the institutional theory and contingency theory, this study aims to examine the effects of leadership and accounting capacity on the quality of financial reporting and accountability of public organisations in Vietnam. Furthermore, this paper is to determine the impact of financial reporting quality on accountability.

Design/methodology/approach

The research model and hypotheses have been tested by partial least squares structural equation modeling, with 177 survey samples obtained from accountants and managers working in the public sector in Vietnam.

Findings

The research results indicate that leadership and accounting capacity have a positive effect on financial reporting quality; leadership and accounting capacity positively influence accountability; and the quality of financial reporting has a positive impact on accountability.

Research limitations/implications

The research results provide empirical evidence of the direct impact of leadership and accounting capacity on financial reporting quality and accountability of public organisations in a developing country. Moreover, the current work also provides important evidence for the impact of financial reporting quality on accountability.

Practical implications

Public sector organisations must realise that leadership and accounting capacity play a vital role in the accounting reform process. Public institutions likewise need to pay attention to develop accounting capacity and promote leadership. Moreover, the results respond to the continuing call for increased citizen trust in public organisations.

Originality/value

To the best of the authors’ knowledge, this study is the first to examine the chain from leadership, accounting capacity, financial reporting quality and accountability in the context of public sector organisations in an Asian transition market.

Keywords

Citation

Tran, Y.T., Nguyen, N.P. and Hoang, T.C. (2021), "Effects of leadership and accounting capacity on accountability through the quality of financial reporting by public organisations in Vietnam", Journal of Asia Business Studies, Vol. 15 No. 3, pp. 484-502. https://doi.org/10.1108/JABS-02-2020-0077

Publisher

:

Emerald Publishing Limited

Copyright © 2021, Emerald Publishing Limited

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