The practice and praxis of earnings management – views from practitioners in Vietnam

Purpose The purpose of this study is to analyze how practitioners in Vietnam understand and engage in earnings management, through the lens of practice theory. Design/methodology/approach This study relies on data collected from interviews with 30 accountants, auditors and regulators in Vietnam. The data were analyzed using thematic analysis, resulting in three key themes: practitioners’ understanding of earnings management; the relationship between accounting standards and earnings management; and the praxis of earnings management. Findings This study examines why practitioners in Vietnam engage in earnings management, often as a response to the pressures received from organizational superiors. The lack of consistent and comprehensive regulation, alongside the discretion permitted within Vietnamese accounting standards, are enablers of earnings management. Originality/value This study demonstrates that an assessment of earnings management should not occur without considering the context and/or motivations of practitioners. It also shows the limitations inherent in Vietnamese accounting standards and their lack of enforcement as factors contributing to earnings management activity.