Vietnam will officially adopt International Financial ReportingStandards (IFRS) from 2016 in its efforts to enhance comparability andimprove transparency.
This information was revealed at a seminarheld in Hanoi on April 21 on accounting standards updates forbusinesses. The seminar was organised by the Hanoi and Hochiminh stockexchanges in collaboration with the Ministry of Finance.
"Shorteningthe gap between Vietnamese and international accounting standards ispart of the country's consistent policy of deeper integration into ASEANand world markets," said Vu Thi Kim Lien, Chairwoman of the CorporateGovernance Advisory Council on the Hanoi Stock Exchange.
She saidthat the new standards would drive Vietnamese companies to enhancefinancial transparency and improve risk controls for better assetmanagement.
This would not only generate profits for businessesbut also contribute positively to the country's economic performance,she added.
Finance Ministry officials informed theseminar of the latest changes in accounting standards as contained inCircular 200/2014/TT-BTC, issued in December last year to replaceDecision No 15/2006 and Circular 244/2009/TT-BTC on the corporateaccounting regime.
Experts said the new circular wasmostly up-to-date, practical and in increased accordance withinternational standards. The regulations are based on a flexible andopen platform that is designed to meet the management requirements anddecision making of businesses, as well as serve investors and creditors,but not made for taxing purposes, they said.
Fivemajor changes were highlighted in the new rules in the areas of currencyaccounting, accounts, financial statements, accounting records andaccounting books.
Businesses with many foreigncurrency transactions can now select one foreign currency for accountingpurposes. However, their financial statements for publication andsubmission to the authorities must still be presented in Vietnamesedong.
In the accounts system, short-term and long-term assets will not be differentiated.
For financial reporting, "tax and other amounts payable to the Statebudget" will no longer fall under the mandatory information category.
The circular also has a new regulation on accountingprinciples and financial statements for companies that do not meet thecontinuous operation requirements.
Businesses candesign templates for accounting records and accounting books for theirown activities, but must comply with requirements in the Accounting Lawand ensure clarity and transparency.
Interim reports will include quarterly financial statements, including the last quarter, and half-year reports.
Vu Duc Nguyen, Deputy General Director of Deloitte, said some of thedifferences between IFRS and the Vietnamese accounting standards (VAS)could be seen in the presentation of financial statements, fair value,financial instruments, impairment write downs, consolidated and separatefinancial statements, business combination, fixed assets, and revenuerecognition.
"Vietnam has set a roadmap to adopt IFRS in2016. This requires strong determination from businesses as IFRS notonly provides rules on financial reporting and accounting, but alsoaffects all business operations," Nguyen said.-VNA
This information was revealed at a seminarheld in Hanoi on April 21 on accounting standards updates forbusinesses. The seminar was organised by the Hanoi and Hochiminh stockexchanges in collaboration with the Ministry of Finance.
"Shorteningthe gap between Vietnamese and international accounting standards ispart of the country's consistent policy of deeper integration into ASEANand world markets," said Vu Thi Kim Lien, Chairwoman of the CorporateGovernance Advisory Council on the Hanoi Stock Exchange.
She saidthat the new standards would drive Vietnamese companies to enhancefinancial transparency and improve risk controls for better assetmanagement.
This would not only generate profits for businessesbut also contribute positively to the country's economic performance,she added.
Finance Ministry officials informed theseminar of the latest changes in accounting standards as contained inCircular 200/2014/TT-BTC, issued in December last year to replaceDecision No 15/2006 and Circular 244/2009/TT-BTC on the corporateaccounting regime.
Experts said the new circular wasmostly up-to-date, practical and in increased accordance withinternational standards. The regulations are based on a flexible andopen platform that is designed to meet the management requirements anddecision making of businesses, as well as serve investors and creditors,but not made for taxing purposes, they said.
Fivemajor changes were highlighted in the new rules in the areas of currencyaccounting, accounts, financial statements, accounting records andaccounting books.
Businesses with many foreigncurrency transactions can now select one foreign currency for accountingpurposes. However, their financial statements for publication andsubmission to the authorities must still be presented in Vietnamesedong.
In the accounts system, short-term and long-term assets will not be differentiated.
For financial reporting, "tax and other amounts payable to the Statebudget" will no longer fall under the mandatory information category.
The circular also has a new regulation on accountingprinciples and financial statements for companies that do not meet thecontinuous operation requirements.
Businesses candesign templates for accounting records and accounting books for theirown activities, but must comply with requirements in the Accounting Lawand ensure clarity and transparency.
Interim reports will include quarterly financial statements, including the last quarter, and half-year reports.
Vu Duc Nguyen, Deputy General Director of Deloitte, said some of thedifferences between IFRS and the Vietnamese accounting standards (VAS)could be seen in the presentation of financial statements, fair value,financial instruments, impairment write downs, consolidated and separatefinancial statements, business combination, fixed assets, and revenuerecognition.
"Vietnam has set a roadmap to adopt IFRS in2016. This requires strong determination from businesses as IFRS notonly provides rules on financial reporting and accounting, but alsoaffects all business operations," Nguyen said.-VNA
