The influence of the internal control system on the truthfulness of financial statements

This study analyzes the influence of the internal control system on the truthfulness of financial statements. By using a quantitative research method, the study finds that the truthfulness of financial statements is affected by the constituent elements of the internal control system. A questionnaire consisting of 29 observed variables was designed, in which the dependent construct—truthfulness of financial statements—was measured by 5 observed variables, while the five independent constructs representing the components of the internal control system were measured by 24 observed variables. The survey was conducted with 105 respondents. The results indicate that the average score for the truthfulness of financial statements is 3.84 and that the control environment has the strongest influence on financial statement truthfulness. These findings are consistent with the current context in Vietnam.