The influence of factors in the internal control system on financial reporting quality at administrative and public service units in Vietnam

Abstract

The objective of the project is to measure the influence of factors in the internal control system on financial reporting quality at administrative and public service units in Vietnam. The author inherits five internal control components from the Committee of Sponsoring Organization [COSO], 2013: control environment, risk assessment, communication information, and supervision that affect financial reporting quality. The author uses a mixed research method including qualitative and quantitative, with primary data collected through a survey of 400 units with 30 observed variables, resulting in 350 valid survey forms. From there, the study analyzed EFA exploratory factor analysis and multivariate regression analysis with support from SPSS 27.0 software. Research results show that the internal control system has an impact on administrative and public service units in Vietnam, with the level of influence of the components gradually decreasing: (1) information and communication, (2) control environment, (3) control activities, (4) risk assessment, (5) monitoring. With the results of this research, it helps administrative and public service units to improve and enhance the financial reporting quality while helping to reduce and eliminate weaknesses in the internal control implementation process, in order to strengthen the internal foundation and influence positive impact on governance.