Financial statements will be applied under international standards

	Inadequacies in financial Statements of export goods
	Publicize State financial statements: Opportunities for management and supervision

The workshop. Photo: T.L

At the seminar Mr. Vu DucChinh, Director of the Accounting and Auditing Regulations Departmentunder the Ministry of Finance stated that an accounting and audit standard applyingan international standard system would bring objectivity and transparency for thefinancial information system.

"According to the strategy up to 2020, Vietnam’s accounting and audit system will approach international practice. Thus, the task set for the Ministry of Finance is to rebuild the Vietnamese Financial Reporting Standards (VFRS) under international standards and the Vietnamese Accounting Standards (VAS or Viet GAAP).The application of international financial reporting standards means that the accounting and auditing system will have a common “language” for all enterprises in Vietnam and in the world. The information in financial statements will be truer and fairer which facilitates for enterprises’ executives to issue decisions” Mr. Chinh shared.

In addition, according to the representative of the Ministry of Finance, currently, some Vietnamese enterprises have participated in the international capital market. Thus,if the financial statements are made in accordance with international standards, foreign investors will be more confident about the information published.

Currently, some countries require that listed companies or public companies must apply international financial reporting standards (IFRS), but some countries permit companies to choose IFRS or nationalfinancial reporting standards. Besides, for the application scope, some countries also stipulate that IFRS only is applied for consolidated financial statements, but some countries allow the application ofIFRS to makeseparate financial statements and consolidated financial statements. The effective date of IFRS application in the country is from 2 to 3 years after the translation of standards or roadmap being announced for businesses to have time to prepare.

In Vietnam, VAS and IFRS are very complicated and relating to many objects, which are different enterprises. The problem for Vietnam is how to apply appropriately with Vietnam. Currently, theMinistry of Finance has developedadraft scheme on IFRS application and VAS updating under the direction of IFRS in Vietnam. Accordingly, the scheme will apply the development of projects, roadmaps and methods of VAS and IFRS application for each specific subject group in Vietnam. At the same time, developing the VFRS in accordance with international standards; updating the current VAS and issuing some new standards. On the other hand, the scheme also specifies the difference between IFRS and VAS, the accounting standards and financial mechanism and tax policies in Vietnam to specify the applications’ scope.

Publicize State financial statements: Opportunities for management and supervision VCN- Like any business, the Ministry of Finance shall publicize State financial statements on its website, which ...

VFRS is required to be applied to listed companies, unlisted companies contributing great benefits to the public such as banks, insurance companies, financial securities companies, financial institutions and State-owned enterprises. Meanwhile voluntary subjects are all other enterprises. The Vietnamese Financial Reporting Standards is applied to make and present financial statements of independent enterprises, and separate financial statements and consolidated financial statements of parent companies.

In contrast, subjects that use VAS are businesses which are not required to apply,but can voluntarily apply forVFRS. VAS is applied to make and present financial statements of independent enterprises, and separate financial statements and consolidated financial statements of parent companies.

It is expected that VAS will be applied in the latest deadline for financial statement on 1st January 2027. Meanwhile, VFRS will be applied on 1st January 2025. Basing on the practical situation, the Ministry of Finance will stipulate the application time of financial reporting standards for each specific object.