This research is conducted to investigate the impact of provincial governance quality on earnings management in the context of Vietnam. The sample of this study was 52 construction materials companies listed on Vietnamese stock market for the period of 2015 - 2017. Consistent with previous research, this paper used discretionary accruals to obtain the discretionary abnormal accruals for measuring earnings management. We employ the data from nationwide surveys of provincial governance quality measured by the provincial competitiveness index. The multiple regression models were estimated to test the impact of the both provincial competitiveness index and ten sub-indices on earnings management of listed companies. This study provided the first empirical evidence for the impact of provincial institution quality and earnings management in Vietnam. The results showed that in the companies with loss, provincial competitiveness index has a negative effect on earnings management. The results also indicated that informal charges index; transparency index and proactivity index have statistical significant negative effect on earnings management. By unfolding the relation between aggregated index and several sub-indicators institution factors and earnings management our findings shed lights on how provincial governance environment can influence on firms level earnings management behavior in the case of Vietnam.

Abstract
1. Introduction
2. Literature Review
3. Research Hypotheses
4. Research Methodology
    4.1. Data Collection
    4.2. Measure of Earnings Management(Dependent Variable)
    4.3. Measure of Provincial Governance
    4.4. Regression Models
5. Results and Discussion
    5.1. Descriptive Statistics
    5.2. Regression Analysis
6. Implications and Conclusion
    6.1. Implications
    6.2. Conclusion
References

• Anh Huu NGUYEN(School of Accounting and Auditing, National Economics University) Corresponding Author
• Chi Thi DUONG(National Economics University)