The impact of audit opinion on cost of debt:  Evidence from Vietnam

Nguyen Vinh Khuong; Nguyen Thi Lan Huong; Vy Bao Chau; Nguyen Ton Huong Mai; Nguyen Le Cam Thi; Cu Tong Hoai Linh

doi:10.46223/HCMCOUJS.econ.en.11.1.1067.2021

Authors

Nguyen Vinh Khuong khuongnv@uel.edu.vn
Faculty of Accounting and Auditing, University of Economics and Law, Vietnam National University Ho Chi Minh City
Nguyen Thi Lan Huong
Faculty of Accounting and Auditing, University of Economics and Law, Vietnam National University Ho Chi Minh City
Vy Bao Chau
Faculty of Accounting and Auditing, University of Economics and Law, Vietnam National University Ho Chi Minh City
Nguyen Ton Huong Mai
Faculty of Accounting and Auditing, University of Economics and Law, Vietnam National University Ho Chi Minh City
Nguyen Le Cam Thi
Faculty of Accounting and Auditing, University of Economics and Law, Vietnam National University Ho Chi Minh City
Cu Tong Hoai Linh
Faculty of Accounting and Auditing, University of Economics and Law, Vietnam National University Ho Chi Minh City

DOI:

https://doi.org/10.46223/HCMCOUJS.econ.en.11.1.1067.2021

Keywords:

audit opinion, cost of debt, listed company, Vietnam

Abstract

We consider whether the category of audit opinion an enterprise receives is pertained to the cost of debt of Vietnam corporations and how does it impact them. Proceeding from the data collected from 80 listed companies in the Vietnam stock exchange in the period of 2007 - 2017, we used a quantitative method to demonstrate the negative impact of modified audit opinion on the cost of debt. When companies receive a modified opinion, they have to pay higher interest rates and have a shorter maturity. From the results, this paper suggests some implications for the financial statement disclosure of listed firms and regulators in order to contribute to the transparency of the financial reports.

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