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The Vietnamese State encourages the development of a multi-sector economy, which promotes the equalization of state-owned enterprises (SOEs). Vietnam developed stock market to meet the opening of international integration. State Securities Commission of Vietnam requires the financial audit to transparent financial statement information. Therefore, external auditing is a part of the economy, which is both a legal requirement and an objective indispensable.
Audits play an important role in maintaining and issuing high-quality financial statements. The benefits of requiring auditing firms bring about many aspects according to Wallace (1980); Knechel (2002) and these values may vary for each enterprise. Wallace (1980) points out that the auditor's assessment of internal processes can help tighten management practices and strengthen compliance with regulatory constraints help improvement in the effectiveness and efficiency of the business operations. DeFond (1992), a study on the relationship between agency costs and switching auditors in the US, the results provide that larger listed firms are likely to choose Big Eight with high audit fee. Firth and Smith (1992), have found that new operating companies hire large audit firms Big Eight. Broye and Weill (2008) argue that firms listed on stock exchanges choose Big4 audit firms because they have more experience in complex business operations. Moreover, the audit firms of Big4 have large international networks in the market. Butler, Leone, & Willenborg (2004) found that customer of Big Five have a higher frequency of obtaining an unqualified opinion.
Studies on selection of audit firms were carried out in several countries, Australia New Zealand and the United Kingdom, Qatar, Taiwan (Firth and Smith, 1992; Mardini, Tahat, 2017; Gerged, Mahamat, & Elmghaamez, 2020; Kao, Shiue, & Tseng, 2013). In Vietnam, according to Hoang Thi Hong Van, (2018), do research to identify factors affecting the decision to choose an audit firm in Vietnam. In detail, the study selected 98 enterprises that have a high value of inventory in the total assets in Hanoi and Ho Chi Minh City to send the survey. These firms have small and medium-sized enterprises which have an asset value of less than 100 billion VND according to Decree 56/2009/ND-CP and TT16/2013/TT-BTC, that account for 50% of the sample. The results show that unlisted companies tends to choose Non-Big because of the low audit fees.
There are many arguments when researchers do study which related auditor choice because of inconsistency in the results of these studies. For example, according to Mayhew and Wilkins (2003), Almutairi et al. (2013), the factor return on total assets (ROA) positively affects auditor choice. However, according to Citron and Manalis (2000), there is no relationship between return on total assets and the choice of audit firms. Meanwhile, following Hoang Thi Hong Van (2018), the ROA variable has a negative effect on the selection of audit firms. In addition, according to Almutairi et al. (2013), the ROA variable is not statistically significant. Firm size positively affects audit selection as well as audit quality (Knechel et al., 2008; Broye and Weill, 2008). However, according to Chow and Rice (1982), this relationship has a negative effect. In addition, Hoang Thi Hong Van (2018) has shown that the firm size is not statistically significant. The degree of firms operational complexity positively affects the choice of audit as well as the quality of the audit (Revier et al., 2010, Hay and Davis, 2004, Knechel et al., 2008, Hay and et al., 2006). In contrast to the above studies, Hoang Thi Hong Van (2018), The degree of firms operational complexity has a negative impact on the choice of audit firms.