1. Legal framework
1.1. Law
Law No. 88/2015/QH13 dated November 20, 2015, the Accounting Law, came into effect on January 1, 2017.
1.2. Vietnamese Accounting Standards
Vietnam issued 26 Vietnamese Accounting Standards (“VAS”) between 2001 and 2005, which were essentially based on older international accounting standards but modified to suit the Vietnamese context. Some important accounting standards, such as Financial Instruments and Impairment of Assets, have yet to be issued in Vietnam.
1.3. Decree
- Decree No. 105/2013/ND-CP dated September 16, 2013, stipulating administrative penalties for violations in the field of accounting and independent auditing, takes effect from December 1, 2013;
- Decree No. 174/2016/ND-CP dated December 30, 2016, detailing a number of articles of the Accounting Law, came into effect on January 1, 2017;
- Decree No. 41/2018/ND-CP dated March 12, 2018, stipulating administrative penalties for violations in the field of accounting and independent auditing, takes effect from May 1, 2018. (This Decree replaces Decree No. 105/2013/ND-CP dated September 16, 2013, of the Government on administrative penalties for violations in the field of accounting and independent auditing).
1.4. Circular
- Circular 200/2014/TT-BTC dated December 22, 2014, Guiding the regulations business accountingThis Circular shall take effect 45 days from the date of signing and shall apply to the fiscal year beginning on or after January 1, 2015;
- Circular No. 202/2014/TT-BTC dated December 22, 2014, which takes effect 45 days from the date of signing, applies to the preparation and presentation of consolidated financial statements for the fiscal year beginning on or after January 1, 2015;
- Circular No. 75/2015/TT-BTC dated May 18, 2015, amending and supplementing Article 128 of Circular 200/2014/TT-BTC dated December 22, 2014;
- Circular No. 53/2016/TT-BTC dated March 21, 2016, amending and supplementing a number of articles of Circular 200/2014/TT-BTC dated December 22, 2014, takes effect from the date of signing and applies to the fiscal year beginning on or after January 1, 2016. Enterprises may choose to apply the exchange rate stipulated in Article 1 of this Circular to their 2015 financial statements;
- Circular No. 133/2016/TT-BTC dated August 26, 2016, guiding the accounting regime for small and medium-sized enterprises, is effective for fiscal years beginning on or after January 1, 2017.
2. Some basic accounting requirements
Writing
The language used in accounting is Vietnamese. Accounting records must be in Vietnamese, but may be combined with a commonly used foreign language.
Accounting period
The accounting year is 12 months. The first accounting year of a newly established business runs from the date the Business Registration Certificate is issued until the last day of the accounting year and must not exceed 15 months. The final accounting year must also not exceed 15 months.
Currency
The currency used in accounting is the Vietnamese Dong (“VND”). All businesses whose primary revenue and expenditure transactions are in foreign currencies may consider using a foreign currency as their accounting currency and when preparing financial statements if certain criteria are met. However, if a business prepares financial statements in a foreign currency, it must convert the financial statements to VND when publishing them to the public and submitting them to the relevant state management agencies in Vietnam.
Accounting documents
Accounting documents and ledgers can be stored on paper or electronically. Accounting documents and ledgers stored electronically do not need to be printed on paper. However, upon request from a competent authority for inspection, supervision, and auditing purposes, the enterprise is responsible for printing out the electronically stored accounting documents, signing them with the signature of the legal representative or chief accountant (responsible for accounting), and affixing the company seal (if applicable).
Stamp
Businesses have the right to independently decide on the form, number, and content of their seals. The management, use, and safekeeping of the seals are governed by the company's charter. Seals are used in cases prescribed by law or agreed upon by the parties.
Archiving accounting documents
Five (05) years for accounting documents used for management and operation; ten (10) years for accounting vouchers used directly to record accounting books and prepare financial statements, accounting books and annual financial statements; and permanent storage for accounting documents that are of historical value and have significant economic, security, and defense importance.
Companies operating in Vietnam must comply with the Vietnamese Accounting System (VAS). The tax authorities use non-compliance with the VAS as a mechanism for tax assessment and penalties, such as denying businesses corporate income tax incentives, prohibiting the inclusion of deductible expenses for corporate income tax purposes, and preventing input VAT deductions/VAT refunds.
3. Some accounting considerations when preparing year-end financial statements.
3.1. Financial reports
Annual financial statements must be approved by the chief accountant and the legal representative, and a copy of the financial statements must be submitted to the current licensing authority within 90 days of the end of the fiscal year. In addition, listed companies and companies with public interest must prepare semi-annual financial statements.
3.2. Conduct an inventory count at the end of the accounting year.
Accountants need to take note.
Companies often forget or fail to conduct asset inventories—cash, inventory, fixed assets, tools, and equipment—at the end of the accounting period before preparing financial statements, and only conduct inventories when requested by auditors.
Current regulations
According to Article 40 of the Accounting Law, "Inventory of assets is the weighing, measuring, and counting of the quantity; confirming and evaluating the quality and value of existing assets and capital at the time of inventory to check and compare with the data in the accounting books and stipulates that accounting units must conduct an inventory of assets at the end of the accounting year."
After conducting an inventory of assets, the accounting unit must prepare a summary report of the inventory results. If there is a discrepancy between the actual inventory figures and the figures recorded in the accounting books, the accounting unit must determine the cause and reflect the difference and the resulting resolution in the accounting books before preparing the financial statements.
At the same time, Article 16 of Decree 41/2018/ND-CP dated March 12, 2018, stipulates penalties for administrative violations in the field of accounting. independent audit Therefore: “A fine of VND 1.000.000 to VND 2.000.000 shall be imposed for any of the following acts: a) Failure to prepare a summary report of inventory results or a report of inventory results lacking the required signatures; b) Failure to reflect the difference and the results of handling the difference between the actual inventory data and the accounting records; A fine of VND 3.000.000 to VND 5.000.000 shall be imposed for the act of failing to conduct asset inventory as prescribed.”
Advice
Based on the regulations mentioned above, conducting an inventory at the end of the accounting year is a mandatory task for the Company. To comply with current regulations and avoid penalties for administrative violations in the field of accounting, the Company needs to issue an Inventory Decision and establish an Inventory Team to carry out the asset inventory at the end of the accounting year.
3.3. Provision for expenses
Accountants need to take note.
When preparing financial statements, accountants often overlook the need to accrue current year expenses such as December utility bills, December accounting expenses, rent, etc., for which invoices and supporting documents are not yet available and are to be paid in the following year, leading to incorrect recording of expenses in the wrong period.
Current regulations
According to Article 82 of Circular 200/2014/TT-BTC and Article 59 of Circular 133/2016/TT-BTC, which stipulate the accounting principles for expenses: “Expenses are amounts that reduce economic benefits, recognized at the time the transaction occurs or when there is a relatively certain likelihood that they will occur in the future, regardless of whether the money has been spent or not.”
"Recognizing expenses even before the payment due date, but when they are likely to be incurred, ensures the principle of prudence and capital preservation."
Simultaneously, according to Article 54 of Circular 200/2014/TT-BTC and Article 43 of Circular 133/2016/TT-BTC, which regulate Account 335 – Accrued Expenses, “This account is used to reflect amounts payable for goods and services received from sellers or provided to buyers during the reporting period but not actually paid due to the lack of invoices or insufficient accounting documents, and is recorded as a production and business expense of the reporting period.”
Advice
The company needs to review and make provisions for recurring and recurring expenses, especially those for December for which supporting documents have not yet been received, such as salaries, bonuses, telephone bills, electricity, water, rent, etc. This helps avoid violations of accounting principles as well as tax risks when expenses are recorded in the wrong period.
3.4. Implement provision/reversal of provisions.
Accountants need to take note.
Companies often fail to conduct year-end checks on the creation/reversal of provisions such as provisions for doubtful receivables, inventory provisions, investment provisions, etc., as required by regulations. This is especially true for companies with slow-moving accounts receivable or inventory consisting of slow-moving, damaged, obsolete, or substandard goods and products.
Current regulations
The procedures for establishing/reversing provisions are detailed in Article 45 of Circular 200/2014/TT-BTC dated December 22, 2014, of the Ministry of Finance guiding the Accounting Regime for Enterprises; Article 36 of Circular 133/2016/TT-BTC dated August 26, 2016, guiding the Accounting Regime for Small and Medium-Sized Enterprises; Circular 228/2009/TT-BTC dated December 7, 2009, of the Ministry of Finance guiding the regime for establishing and using provisions for inventory devaluation, losses on financial investments, uncollectible receivables, and product, goods, and construction warranty at Enterprises; and Circular 89/2013/TT-BTC dated June 28, 2013, of the Ministry of Finance amending and supplementing Circular No. 228/2009/TT-BTC.
Advice
At the end of the accounting year, the company needs to proactively determine the level of provision/reversal based on actual fluctuations in inventory prices, securities prices, the value of financial investments, uncollectible accounts receivable, and product warranty commitments. This will help the business have the financial resources to compensate for potential losses during the planning year, thereby preserving business capital; ensuring that the value of inventory, financial investments, and accounts receivable is not higher than market prices at the time of preparing the financial statements. The time for establishing and reversing provisions is at the end of the accounting year.
3.5. Assessing end-of-period exchange rate differences for monetary items denominated in foreign currencies.
Accountants need to take note.
The company often forgets to revalue monetary items denominated in foreign currencies when preparing the year-end financial statements.
Current regulations
In accordance with Circular 200/2014/TT-BTC
According to Article 69, "Account 413 – Exchange Rate Differences," of Circular 200/2014/TT-BTC dated December 22, 2014, issued by the Ministry of Finance, guiding the accounting regime for enterprises, it is stipulated that "Enterprises must revalue monetary items denominated in foreign currency at the actual exchange rate at all times of preparing financial statements as prescribed by law. For enterprises that have used financial instruments to hedge against exchange rate risk, they are not allowed to revalue loans and liabilities denominated in foreign currency that have been hedged against exchange rate risk using financial instruments."
The principle for revaluing the balances of monetary items denominated in foreign currencies at the actual exchange rate is as follows:
- Monetary items denominated in foreign currency are classified as liabilities: they are valued at the foreign currency selling rate of the commercial bank where the enterprise regularly conducts transactions at the time of preparing the financial statements;
- Monetary items denominated in foreign currency are classified as assets: they are valued at the foreign currency buying rate of the commercial bank where the enterprise regularly conducts transactions at the time of preparing the financial statements;
- For foreign currency deposits in banks, the actual exchange rate used for revaluation is the buying rate of the bank where the enterprise opens its foreign currency account;
- The units within the group apply a common exchange rate set by the parent company (which must closely reflect the actual transaction rate) to revalue monetary items denominated in foreign currencies arising from internal transactions.
In cases where a business uses an approximate exchange rate, based on the average buying and selling transfer rate of the commercial bank where it regularly conducts transactions, to account for foreign currency transactions arising during the period, at the end of the accounting period, the business uses the transfer exchange rate of the commercial bank where it regularly conducts transactions to revalue monetary items denominated in foreign currency. This transfer exchange rate may be the buying or selling rate or the average buying and selling transfer rate of the commercial bank. The approximate exchange rate must ensure that the difference does not exceed +/-1% compared to the average buying and selling transfer rate.
In accordance with Circular 133/2016/TT-BTC
According to Article 52, "Account 413 – Exchange Rate Differences," of Circular 133/2016/TT-BTC dated August 26, 2016, issued by the Ministry of Finance, guiding the accounting regime for small and medium-sized enterprises, it is stipulated that "Enterprises must revalue monetary items denominated in foreign currency at the average end-of-period transfer exchange rate of the commercial bank where the enterprise regularly conducts transactions at all times when preparing financial statements as prescribed by law."
Average end-of-period transfer exchange rate: the average of the end-of-period transfer buying and selling rates of the commercial bank where the business regularly conducts transactions.
Advice
Based on the above regulations and the System Company Accountant This is being applied as a basis for reassessing exchange rate differences at the end of the period before preparing financial statements for monetary items denominated in foreign currencies, in accordance with current regulations.
3.6. Classification of short-term and long-term indicators on the Balance Sheet
Accountants need to take note.
The company's classification and presentation of items on the Balance Sheet are not in accordance with current regulations, especially for receivables, payables, and financial investments with original terms exceeding 12 months. The beginning balances are listed under long-term items, but at the end of the period, the remaining payment period is less than 12 months and they are not classified and presented under short-term items.
Current regulations
In accordance with Circular 200/2014/TT-BTC
According to Article 112 of the "Guidelines for preparing and presenting the annual balance sheet" of Circular 200/2014/TT-BTC dated December 22, 2014, issued by the Ministry of Finance guiding the accounting regime for enterprises, the Assets and Liabilities items on the balance sheet must be presented separately as short-term and long-term, depending on the duration of the enterprise's normal business cycle, accordingly:
- Assets and liabilities that are recoverable or payable within no more than 12 months from the reporting date are classified as short-term (except for prepaid expenses determined on the original time basis);
- Assets and liabilities that are due or payable 12 months or more from the reporting date are classified as long-term (except for prepaid expenses which are determined on the original time basis).
In accordance with Circular 133/2016/TT-BTC
According to the guidelines in Articles 81 and 82 of Circular 133/2016/TT-BTC dated August 26, 2016, issued by the Ministry of Finance, guiding the accounting regime for small and medium-sized enterprises, the Assets and Liabilities items on the Statement of Financial Position are presented separately as short-term and long-term (similar to the guidance on presenting the Balance Sheet in Circular 200/2014/TT-BTC) or presented according to decreasing liquidity (without classifying short-term and long-term).
For micro-enterprises, the Statement of Financial Position is presented in descending order of liquidity.
Advice
Businesses need to base their classification and presentation of balances of financial investments, accounts receivable, prepaid expenses, other assets, and liabilities on financial statements on the accounting system they are applying, in accordance with current regulations.
3.7. Offsetting other income and other expenses related to the sale and liquidation of fixed assets and investment properties when presenting the business results.
Accountants need to take note.
When presenting the liquidation of fixed assets, accountants often still apply the old method of presentation, where income from the liquidation of fixed assets is presented under the "Other Income" item and the remaining value of the liquidated fixed assets is presented under the "Other Expenses" item on the Income Statement. Instead, the company must offset other income against other expenses before presenting the liquidation and sale transactions of fixed assets and investment properties on the Income Statement.
Current regulations
According to Article 113 "Guidelines for preparing and presenting the Statement of Income" of Circular 200/2014/TT-BTC dated December 22, 2014, of the Ministry of Finance guiding the Accounting System for Enterprises and Article 81 "Guidelines for preparing and presenting Financial Statements" of Circular 133/2016/TT-BTC dated August 26, 2016, of the Ministry of Finance guiding the Accounting System for Small and Medium-sized Enterprises, Code 31 "Other Income" and Code 32 "Other Expenses" stipulate that for transactions involving the liquidation or sale of fixed assets and investment properties, the figure to be recorded in this item is the difference between the revenue from the liquidation or sale of fixed assets and investment properties that is higher than the remaining value of the fixed assets and investment properties and the liquidation costs.
Advice
Based on the above regulations, when presenting the Statement of Business Results, the Company needs to offset other income and other expenses from the liquidation of fixed assets and investment properties when presenting them under Code 31 and Code 32 to comply with current regulations on the Vietnamese Accounting System.
3.8 Present the after-tax profit.
Accountant's note
When preparing financial statements according to Circular 200, the figures presented under the item "Undistributed after-tax profit for this period" (Code 421b) do not match between the Balance Sheet and the Income Statement due to several common errors such as: tax arrears being directly recorded in undistributed after-tax profit or errors occurring in the preparation of financial statements.
Current regulations
According to Article 112 of Circular 200/2014/TT-BTC dated December 22, 2014, issued by the Ministry of Finance, guiding the Enterprise Accounting System, "Information to be recorded in the item 'Undistributed after-tax profit for this period' on the annual balance sheet is the credit balance of account 4212 'Undistributed after-tax profit for this year'. If account 4212 has a debit balance, the figure for this item shall be recorded as a negative number in parentheses (...)."
Advice
Based on the above regulations, the data to be presented under the item "Undistributed after-tax profit for this period" (Code 421b) is taken from the item "After-tax profit of corporate income tax" (Code 60) on the Statement of Income.
Therefore, if a discrepancy occurs in the undistributed after-tax profit figure, the Company needs to review and check several aspects such as: the profit already distributed during the year according to the owner's profit distribution agreement, checking for unusual entries in account 421 other than normal profit transfers and retrospective adjustments, or checking for potential errors in the financial statement preparation method.
3.9. Identifying Stakeholders
Accountant's note
The company often fails to accurately identify and fully present information about related parties as required by Vietnamese Accounting Standards and the current Corporate Accounting System.
Current regulations
According to Vietnamese Accounting Standard No. 26 "Information on Related Parties," parties are considered related if one party has the ability to control or significantly influence the other party in making decisions on financial and operational policies; and financial statements must present certain relationships between related parties. Relationships often highlighted include transactions involving business leaders, shareholders, capital contributors, etc., especially salaries and loans, accounts receivable and payable. In addition, transactions between companies within the same group and the balances of accounts receivable and payable between the group, its associates, and the Board of Directors must be presented.
Major transactions between related parties must also be presented in the financial statements of the reporting entity in the period in which those transactions have an impact, including: Purchase or sale of goods (finished goods or work-in-progress); Purchase or sale of fixed assets and other assets; Provision or receipt of services; Agency transactions; Lease transactions; Transfer of research and development; Licensing agreements; Grants; Guarantees and mortgages; Management contracts.
Advice
Based on the above regulations, when presenting the Notes to the Financial Statements, the Company should ensure that it fully discloses information regarding the content and value of transactions arising during the year, and the balances at the time of preparing the Financial Statements, for all related parties in accordance with current regulations.
Furthermore, when dealing with related parties, it is also necessary to comply with Decree 20/2017/ND-CP dated February 24, 2017 and Circular 41/2017/TT-BTC dated June 15, 2017, which regulate tax management for enterprises with related-party transactions.
3.10. Conduct accounts receivable reconciliation.
Accountants need to take note.
Accountants often fail to send year-end accounts receivable reconciliation statements, or they send reconciliation statements without receiving feedback from the relevant parties, or the reconciliation results show discrepancies but the accountants do not pay attention to resolving them, leading to accounts receivable balances and related items presented in the financial statements not accurately reflecting the company's actual situation.
Advice
- Accounts receivable and payable
- Accounts receivable and payable require verification and confirmation letters at the end of the year when preparing financial statements to ensure the accuracy of accounts receivable and payable, promptly identify the causes and adjust any discrepancies (if any), and avoid overlooking expenses/revenues during the year. Simultaneously, this helps the company manage its financial resources effectively, identify debts due for payment so that necessary preparations can be made, and identify uncollectible receivables, establishing adequate provisions as required.
- Tax debts to the tax authorities, social insurance debts to the social insurance agency.
- Accountants need to contact these authorities to confirm the accuracy of tax and social insurance payments. This reconciliation aims to help businesses minimize the risk of tax and insurance debt, avoid penalties and back taxes when tax authorities conduct audits; and detect errors in payroll accounting, insurance deductions, etc.
3.11. Allocate the common VAT amount to taxable and non-taxable activities based on the ratio of total annual revenue.
Accountants need to take note.
For some companies that have both taxable and non-taxable revenue on a monthly/quarterly basis, VAT is allocated to each activity, so at the end of the year, accountants often overlook reallocating it proportionally to the revenue for the entire year.
Current regulations
According to Clause 9, Article 1 of Circular 26/2015/TT-BTC: “Input VAT on goods and services (including fixed assets) used simultaneously for the production and business of goods and services subject to VAT and those not subject to VAT shall only be deductible for the input VAT of goods and services used for the production and business of goods and services subject to VAT. Businesses must separately account for deductible and non-deductible input VAT; if separate accounting is not possible, the deductible input VAT shall be calculated according to the percentage (%) ratio between VAT-taxable revenue, revenue not subject to VAT declaration and payment, and total revenue from goods and services sold, including revenue not subject to VAT declaration and payment that cannot be separately accounted for.”
Businesses dealing in goods and services subject to and exempt from VAT shall provisionally allocate the deductible input VAT on purchased goods, services, and fixed assets on a monthly/quarterly basis. At the end of the year, the business shall calculate and allocate the deductible input VAT for the year to declare and adjust the input VAT that was provisionally allocated and deducted monthly/quarterly.”
Advice
Based on the above guidelines, businesses that incur input VAT that is used for both taxable and non-taxable output can calculate and allocate it for each tax declaration period (month/quarter) according to the correct ratio of revenue for that month/quarter. However, at the end of the year, the amount of VAT used for deduction must be recalculated according to the ratio (taxable revenue for the whole year / total revenue for the whole year), and the difference must be adjusted in the final VAT declaration period (December 2018 or Q4 2018).
Download file: Notes on preparing financial statements
4. Other common topics accountants need to be aware of.
4.1. Salary Costs
Regarding personal income tax: According to the personal income tax law, the time for calculating personal income tax on salaries and wages is the time of payment. Therefore, companies that pay salaries out of period for year-end salary payments are subject to personal income tax. For example, if an employee's December 2018 salary is paid in January 2019, this income is subject to personal income tax for the year 2019.
Regarding corporate income tax: According to Point 2.5, Clause 2, Article 6 of Circular 78/2014/TT-BTC issued on June 18, 2014, and Point 2.6, Clause 2, Article 4 of Circular 96/2015/TT-BTC issued on June 22, 2015, amending and supplementing the Regulations on... Non-deductible expenses Regarding expenses related to salaries, wages, and bonuses for employees, the following items are not deductible when determining corporate income tax:
- Salaries, wages, and other payments to employees that the enterprise has accounted for as production and business expenses during the period but were not actually paid or lacked supporting documents as required by law.
- Salaries, bonuses, and life insurance premiums for employees are not specifically documented with conditions and amounts stipulated in any of the following documents: employment contracts; collective labor agreements; financial regulations of the Company, Corporation, or Group; bonus regulations stipulated by the Chairman of the Board of Directors, General Director, or Director in accordance with the financial regulations of the Company or Corporation.
- "Payments of salaries, wages, and allowances payable to employees but not disbursed by the deadline for filing the annual tax return, except in cases where the enterprise has established a reserve fund to supplement the salary fund for the following year. The annual reserve amount is determined by the enterprise but shall not exceed 17% of the actual salary fund."
- Salaries and wages of private business owners and owners of single-member limited liability companies (owned by a single individual); remuneration paid to founders, members of the board of members, and board of directors who do not directly participate in the management of production and business operations.
4.2. Verify the consistency of revenue, cost of goods sold, and expenses.
According to accounting standard number 14Revenue and other income"Then"Revenue and expenses related to the same transaction must be recognized concurrently according to the matching principle. Expenses, including expenses incurred after the delivery date (such as warranty and other expenses), are generally determined with certainty when the revenue recognition conditions are met. Customer advance payments are not recognized as revenue but are recognized as a liability at the time the customer advance payment is received. A liability for customer advance payments is only recognized as revenue when all five (5) conditions specified in paragraph 10 are met simultaneously.".
Based on the above regulations, the Company should carefully review and verify that revenue and expenses have been fully recorded, including cost of goods sold, especially for transactions before and after the end of the fiscal year.
4.3. Payment methods in loan transactions
In loan and lending transactions between businesses that are not credit institutions, the payment method used is cash.
According to Articles 3 and 4 of Circular 09/2015/TT-BTC dated January 29, 2015, guiding financial transactions of enterprises as stipulated in Article 6 of Government Decree No. 222/2013/ND-CP dated December 31, 2013, on cash payments, enterprises other than credit institutions, when conducting loan, lending, and debt repayment transactions with each other, are not allowed to use cash (paper money, metal coins issued by the State Bank of Vietnam) but must use the following forms: a) Payment by check; b) Payment by payment order – money transfer; c) Other appropriate non-cash payment methods as prescribed by current regulations.
Based on the regulations mentioned above, the company should note that if any loan, lending, or debt repayment transactions occur between businesses, it must comply with the above regulations to avoid potential administrative penalties for violating payment methods in loan, lending, and debt repayment transactions.
5. Several new accounting regulations came into effect in 2018.
5.1. Decree 41/2018/ND-CP
According to Decree 41/2018/ND-CP regulating administrative penalties in the field of accounting and independent auditing, the maximum fine for an administrative violation in the field of accounting and independent auditing is VND 50 million for individuals and VND 100 million for organizations.
5.2. Fines of up to 30 million VND for falsifying or misrepresenting accounting documents.
Specifically, in the field of accounting, regarding penalties for violations of general accounting laws:
- A fine of 10-20 million VND will be imposed for any of the following acts: Incorrect application of regulations on writing and numerals in accounting; incorrect application of regulations on currency units in accounting; incorrect application of regulations on accounting periods; incorrect application of the accounting system applicable to the entity.
- Organizations that issue or publish accounting standards, auditing standards, or accounting regulations without proper authority will be fined between 20 and 30 million VND.
Regarding penalties for violations of regulations concerning accounting documents:
- A fine of 3-5 million VND will be imposed for any of the following acts: Accounting documents lacking the required essential contents; erasing or altering accounting documents; signing accounting documents with red ink or ink that fades; signing accounting documents using a pre-engraved signature stamp; and not signing each copy of cash disbursement documents.
- A fine of 5-10 million VND will be imposed for any of the following acts: preparing accounting documents with insufficient copies as prescribed for each type of accounting document; signing accounting documents before all the required information has been entered; signing accounting documents without proper authority; inconsistent signatures or signatures not matching the registered signature mẫu; accounting documents lacking sufficient signatures according to the designated positions; failure to translate foreign-language accounting documents into Vietnamese as required; damage or loss of accounting documents during use.
- A fine of 20-30 million VND will be imposed for any of the following acts: Falsifying or misrepresenting accounting documents but not to the extent of criminal prosecution; agreeing with or coercing others to falsify or misrepresent accounting documents but not to the extent of criminal prosecution; creating accounting documents with inconsistent content across multiple copies when multiple copies are required for a single economic or financial transaction; failing to create accounting documents when an economic or financial transaction occurs; creating multiple accounting documents for a single economic or financial transaction; making payments when the payment voucher lacks the full signatures of authorized persons as prescribed by accounting law.
5.3. Severe penalties for falsifying financial report data.
The decree also specifies the penalties for violations of regulations on the preparation and presentation of financial statements. Specifically:
- A fine of 5-10 million VND will be imposed for any of the following acts: preparing financial statements with incomplete content or not in the prescribed form; financial statements lacking the signature of the preparer, chief accountant, accounting manager, or legal representative of the accounting unit.
- For any of the following violations: failing to prepare financial statements in accordance with regulations; applying financial statement templates different from those prescribed by accounting standards and regulations, except in cases approved by the Ministry of Finance, a fine of 10-20 million VND will be imposed.
- A fine of 20-30 million VND will be imposed for any of the following acts: Failure to prepare financial statements as required; preparing financial statements that do not match the figures in the accounting books and accounting documents; preparing and presenting financial statements that do not comply with accounting regulations and accounting standards.
- A fine of 40-50 million VND will be imposed for any of the following acts: Falsifying financial statements, making false declarations in financial statements but not to the extent of criminal prosecution; agreeing with or coercing others to falsify financial statements, making false declarations in financial statements but not to the extent of criminal prosecution; intentionally, agreeing with, or coercing others to provide or confirm false accounting information or data but not to the extent of criminal prosecution.
The decree takes effect from May 1, 2018.
5.4. Accounting violations are punishable by imprisonment for up to 20 years.
In 2018, the 2015 Penal Code came into effect, adding offenses related to the field of accounting.
Specifically, Article 221 of this Code stipulates: Anyone who abuses their position or authority to commit acts of forgery, falsification, collusion, or coercion to falsify or falsify accounting documents; entices, colludes with, or coerces others to provide or confirm false accounting information or data; destroys or intentionally damages accounting documents before the retention period…causing damage from 100 million to less than 300 million VND, or less than 100 million VND but has already been subjected to disciplinary action or administrative penalties and continues to violate the law, shall be punished with non-custodial correctional measures for up to 03 years or imprisonment from 01 to 05 years.
5.5. Submit financial reports in accordance with Circular No. 133/2016/TT-BTC (Official Letter No. 1980/TCT-KK dated May 23, 2018)
Based on the above guidelines, small and medium-sized enterprises (including micro-enterprises) subject to the accounting regime under Circular No. 133/2016/TT-BTC dated August 26, 2016, of the Ministry of Finance must prepare and submit financial statements to the relevant management agencies (tax authorities, business registration agencies, and statistics agencies) using the forms and instructions in Circular No. 133/2016/TT-BTC from the fiscal year beginning on or after January 1, 2017. In cases where these enterprises have already submitted financial statements using the financial statement forms issued with Decision No. 48/2006/QD-BTC, the tax authorities will instruct them to resubmit financial statements using the forms issued with Circular No. 133/2016/TT-BTC.
The tax authorities will base their administrative penalties for late submission of tax returns on the date specified in the first notification of the financial report as per Decision 48/2006/QD-BTC (the date recording that the taxpayer has fulfilled their obligation to submit the financial report).
5.6. Decree 39/2018/ND-CP
Government Decree 39/2018/ND-CP detailing some provisions of the Law on Support for Small and Medium-Sized Enterprises
Criteria for identifying small, medium, and micro-sized enterprises in the agriculture, forestry, fisheries, industry, and construction sectors:
| Criteria for the year | Ultra small | Soft | Fit |
| Personnel | <= 10 people; and | <= 100 people; and | <= 200 people; and |
| Revenue | <= 3 billion VND; or | <= 50 billion VND; or | <= 200 billion VND; or |
| Capital | <= 3 billion VND | <= 20 billion VND | <= 100 billion VND |
Businesses in the trade and service sector:
| Criteria for the year | Ultra small | Soft | Fit |
| Personnel | <= 10 people; and | <= 50 people; and | <= 100 people; and |
| Revenue | <= 10 billion VND; or | <= 100 billion VND; or | <= 300 billion VND; or |
| Capital | <= 3 billion VND | <= 50 billion VND | <= 100 billion VND |
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