At the seminar (Photo: ACCA Vietnam Courtesy) Hanoi (VNA) - Vietnam isexpected to adopt International Financial Reporting Standards (IFRS) instead ofthe current Vietnamese accounting standards (VAS) by 2025 in its efforts toenhance comparability and improve transparency.
This information was revealed at a seminar held in Hanoi on December 23 withthe theme: “IFRS - Trend and roadmap for adoption in Vietnam,” co-organised by VietnamAssociation of Accountants and Auditors (VAA), and theAssociation of Chartered Certified Accountants (ACCA) in collaboration with theMinistry of Finance.
VAS standards show some disadvantages when compared to IFRS, and VAS standardsmay create barriers and reduce confidence among foreign investors in Việt Nam,said Director of the Accounting and Auditing Policies Department under theMinistry of Finance Vu Duc Chinh.
Chinh said businesses’ financial statements under VAS standards cannotaccurately reflect the value of assets and liabilities, thus the application ofthe international accounting system is crucial and inevitable.
“The financial statements under IFRS standards help investors compare theoperational indicators of the listed company on the regional, as well asinternational, stock market due to the simultaneous application ofinternational financial reporting norms, therefore helping them to makeaccurate assessments and have a more comprehensive vision on the operation oflisted companies,” said Director of the State SecuritiesCommission (SSC)’s Inspection Department Nguyen The Tho.
According senior financial management specialist at the World Bank, ChrisFabling, IFRS standards are a single set of accounting standards, developed andmaintained by the International Accounting Standards Board with the intentionof those standards being capable of application on a globally consistent basis.
Fabling said IFRS Standards bring transparency, accountability and efficiencyto financial markets around the world and added that IFRS adoption continues togain momentum because they are globally accepted as accounting standards.
“Currently, 93 percent (133 of 143 jurisdictions) around the world havepublicly confirmed IFRS adoption and implementation, 83 per cent (119 of 143jurisdictions) require all or most domestic public companies to comply withIFRS,” Fabling said, added that adopting IFRS standards in a comprehensive wayoften takes 5 to 10 years depending on the conditions and ability of eachcountry.
During the seminar, Finance Ministry officials informed the seminar of thelatest changes in accounting standards as contained in Circular200/2014/TT-BTC, issued in December last year to replace Decision No 15/2006and Circular 244/2009/TT-BTC on the corporate accounting regime.
Experts said the new circular was mostly up-to-date, practical and in increasedaccordance with international standards.
Regarding the roadmap for Vietnam, seminar participants agreed that during 2018– 2020, 10 to 20 simple IFRS standards will be selected to be put intopractice, and officially applied for all the firms listed on the stock market from2020.
All other businesses that have sufficient conditions and wish to apply IFRS arealso encouraged to. But from 2023 to 2025, all firms within the country willhave to complete their conversion process, the seminar heard.
This information was revealed at a seminar held in Hanoi on December 23 withthe theme: “IFRS - Trend and roadmap for adoption in Vietnam,” co-organised by VietnamAssociation of Accountants and Auditors (VAA), and theAssociation of Chartered Certified Accountants (ACCA) in collaboration with theMinistry of Finance.
VAS standards show some disadvantages when compared to IFRS, and VAS standardsmay create barriers and reduce confidence among foreign investors in Việt Nam,said Director of the Accounting and Auditing Policies Department under theMinistry of Finance Vu Duc Chinh.
Chinh said businesses’ financial statements under VAS standards cannotaccurately reflect the value of assets and liabilities, thus the application ofthe international accounting system is crucial and inevitable.
“The financial statements under IFRS standards help investors compare theoperational indicators of the listed company on the regional, as well asinternational, stock market due to the simultaneous application ofinternational financial reporting norms, therefore helping them to makeaccurate assessments and have a more comprehensive vision on the operation oflisted companies,” said Director of the State SecuritiesCommission (SSC)’s Inspection Department Nguyen The Tho.
According senior financial management specialist at the World Bank, ChrisFabling, IFRS standards are a single set of accounting standards, developed andmaintained by the International Accounting Standards Board with the intentionof those standards being capable of application on a globally consistent basis.
Fabling said IFRS Standards bring transparency, accountability and efficiencyto financial markets around the world and added that IFRS adoption continues togain momentum because they are globally accepted as accounting standards.
“Currently, 93 percent (133 of 143 jurisdictions) around the world havepublicly confirmed IFRS adoption and implementation, 83 per cent (119 of 143jurisdictions) require all or most domestic public companies to comply withIFRS,” Fabling said, added that adopting IFRS standards in a comprehensive wayoften takes 5 to 10 years depending on the conditions and ability of eachcountry.
During the seminar, Finance Ministry officials informed the seminar of thelatest changes in accounting standards as contained in Circular200/2014/TT-BTC, issued in December last year to replace Decision No 15/2006and Circular 244/2009/TT-BTC on the corporate accounting regime.
Experts said the new circular was mostly up-to-date, practical and in increasedaccordance with international standards.
Regarding the roadmap for Vietnam, seminar participants agreed that during 2018– 2020, 10 to 20 simple IFRS standards will be selected to be put intopractice, and officially applied for all the firms listed on the stock market from2020.
All other businesses that have sufficient conditions and wish to apply IFRS arealso encouraged to. But from 2023 to 2025, all firms within the country willhave to complete their conversion process, the seminar heard.
Luu Thi Thao, Deputy CEO of VP Bank, one ofthe pioneering firms in adopting IFRS standards said the bank has beenproactively applying IFRS standards for five years now, to enhance transparencyand corporate governance capabilities of the companies as well as removebarriers to inward investment.
Thao said the Ministry of Finance shouldconsider a clear roadmap for the application of IFRS standards instead of VASso that local firms can have an idea on the time and resources needed to beprepared.-VNA
VNA
