Difference between VAS and IFRS: Introducing the characteristics of accounting standards in Vietnam (display of financial statements and account code)

Difference between VAS and IFRS: Introducing the characteristics of Vietnamese accounting standards

Vietnam Accounting Standard(VAS) isInternational Financial Reporting Standards (IFRS)Has been adopted as the basis. International Financial Reporting Standards IFRS is a global accounting standard issued and regulated by the International Accounting Standards Board (IASB), which describes the preparation and presentation of financial reports.

 

⇒Comparison table of VAS and IFRS

There are important differences between VAS and IFRS, and here are some of them.

Vietnam government based on IFRSVASIs issued. To provide guidance to Vietnamese local and foreign companies on these standards, the Ministry of Finance has issued a Circular, No 200/2014/TT-BTC and No. 202/2014/TT, which will increase the comparability and transparency of companies. -Issuing BTC.

Difference between VAS and IFRS: Presentation of financial statements

The financial statements under IFRS mainly consist of:

• Balance sheet
• Profit and loss statement
• Cash flow statement
• Statement of changes in equity (Statement of changes in equity)
• Notes and supporting details

The components of financial statements based on VAS are as follows:

• Balance sheet
• Profit and loss statement
• Cash flow statement
• Notes and supporting details

It should be noted that under Vietnam GAAP, the statement of changes in equity is treated as a note rather than as a major component of financial statements. In addition, the Vietnamese accounting standards do not require management to make important judgments, disclose the uncertainty of estimation, and so on.

Japanese accounting standards also require the creation of a statement of changes in shareholders' equity, similar to IFRS. In such a case, the Vietnamese subsidiary can also prepare a statement of changes in shareholders' equity.

Difference between VAS and IFRS: Vietnam unique account code

The Vietnamese Ministry of Finance has issued a uniform chart of accounts for corporate financial statements (Notification No. 200/2014 / TT-BTC). Each company uses a unified account code to enable comparability between companies. Comparability can be comparison of past and present in the same company, comparison of period, comparison between other companies and the company, or between companies, but with a uniform account code The comparison will be possible.

The difference between VAS and IFRS

All foreign and local companies operating in Vietnam are required to comply with VAS. This time, I introduced the two main differences. Although it is a small detail, there are various other differences, such as the handling of borrowing costs when you purchase fixed assets using debt.

Foreign companies are advised to consult with an expert in Vietnamese local accounting and law in order to fully understand the legal requirements and make informed investment decisions.

 

⇒ Differences in recognition between VAS and IFRS (for accounting department / chief account)