Based on Article 108 of Circular No. 200/2014/TT-BTC dated December 22, 2014 of the Ministry of Finance for implementation.
Article 108. Principles for preparing financial statements when changing the accounting currency.
- When changing the accounting currency, in the first period after the change, the accountant converts the accounting book balances to the new accounting currency using the transfer exchange rate of a commercial bank where the business regularly conducts transactions on the date of the change in accounting currency.
- Exchange rates applied to comparative information (previous period column) on the Income Statement and Cash Flow Statement:
When presenting comparative information on the income statement and cash flow statement for a period in which the accounting currency changes, the entity applies the average transfer exchange rate of the period immediately preceding the period of change (if the average exchange rate is approximately equal to the actual exchange rate).
- When changing the accounting currency, businesses must clearly state in the Notes to the Financial Statements the reason for the change and any impact (if any) on the financial statements resulting from the change in accounting currency.
