Date post: | 03-Jun-2018 |
Category: |
Documents |
Upload: | tieuquan42 |
View: | 217 times |
Download: | 0 times |
of 43
8/12/2019 Comparison IFRS VAS
1/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
This brief comparison is based on IFRS and VAS as at 24 May 2004. IFRS and VAS are both subject to chanes.
IFRS Ref IFRS VAS
Framework Framework for the preparation and presentation of financialstatements
The Framework deals with:
(a) The objective of financial statements;
to provide information about the financial position,
performance and changes in financial position of an
enterprise that is useful to a wide range of users in
making economic decisions;
to show the results of the stewardship of management, or
the accountability of management for the resources
entrusted to it
(b) The underlying assumptions: accrual basis, going concern
(c) The !ualitative characteristics that determine the usefulness
of information in financial statements The " principal
!ualitative characteristics are: understandability, relevance,
reliability and comparability
(d) The definition, recognition and measurement of the elements
from which financial statements are constructed # assets,
liabilities, e!uity, income and e$penses
(e) %oncepts of capital and capital maintenance
The &inistry of Finance ('&oF) issued a standard *+ %hartof *ccounts in ecision --"- (dated - .ovember -//0) This
has been amended by various %irculars since The most recent
guidance is contained in %ircular 00 for Foreign1invested
enterprises (dated 23 4une 2552), %ircular 6/ (dated / 7ctober
2552) and %ircular -50 (dated " .ovember 2558)
-3 new ietnamese *ccounting +tandards have been issued
since 8- ecember 255- These are based on 9F+, with certainamendments, as described in the relevant sections below
*+5- 1Frame!or"(issued on 8- ecember 2552) is based on
the 9*+:Frame!or" for the preparation and presentation of
financia# statements. *+5- is shorter and more simple that the
9*+ Framework, however all the key areas and concepts are
covered, including:
asic accounting principles # accruals, going concern,
matching, prudence, consistency
e!uirements of *ccounting 9nformation # integrity,
objectivity, completeness, timeliness, comparability
8/12/2019 Comparison IFRS VAS
2/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ - Presentation of financial statements
9*+ - is designed to improve the !uality of financial statementspresented using 9nternational *ccounting +tandards by:
ensuring that financial statements that state compliance
with 9*+ comply with each applicable +tandard,
including all disclosure re!uirements;
ensuring that departures from 9*+ re!uirements are
restricted to e$tremely rare cases;
providing guidance on the structure of financial
statements including minimum re!uirements for each
primary statement, accounting policies and notes, and anillustrative appendi$; and
establishing practical re!uirements on issues such as
materiality, going concern, the selection of accounting
policies when no +tandard e$ists, consistency and the
presentation of comparative information
Financial statements comprise a balance sheet, income
statement, cash flow statement, statement of changes in e!uity,and notes to the financial statements
!ote"9*+ - was revised in ecember 2558, with the changes
effective for accounting periods beginning on or after - 4anuary
2550 The changes include:
=uidance on the meaning of 'present fairly
=ives a definition of 'material
*+2- #$resentation of financia# statements(issued on 85ecember 2558) is based on 9*+ - #$resentation of financia#
statements 9t is very similar to the previous version of 9*+ -,
especially the sections onRe%uirements in $reparation and$resentation of Financia# Statements, including:
=oing concern
*ccrual basis
%onsistency of presentation
%omparative information
The sections in *+2- onInformation to be presented on theface of the ba#ance sheet and income statementapply the
headings given in the standard *+ Financial +tatements
Format, and *+2- also notes that the format for presenting
these financial statements is prescribed in the applicable
regulations This is a more prescriptive approach than 9*+ -
There are no illustrative financial statements in *+2-
eference needs to be made to the relevant %irculars, such as
%ircular 00, for the re!uired format of financial statements
The implementing guidance for *+2- has not yet been issued,
but is not e$pected to have a significant impact on the current*+ format for financial statements
.ote that *+2- includes an analysis of changes in e!uity in the
notes to the financial statements The statement of changes in
e!uity is not a re!uired primary statement as in 9*+ -
2
8/12/2019 Comparison IFRS VAS
3/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ -
evised
(continued)
The evised +tandard re!uires a financial liability that is due
within twelve months after the balance sheet date, or for which
the entity does not have an unconditional right to defer itssettlement for at least twelve months after the balance sheet date,
to be classified as a current liability This classification is
re!uired even if an agreement to refinance, or to reschedulepayments, on a long1term basis is completed after the balance
sheet date and before the financial statements are authorised for
issue
The evised +tandard re!uires the following disclosures:
(a) the judgements management has made in the process of
applying the entity>s accounting policies that have the mostsignificant effect on the amounts recognised in the financial
statements; and
(b) the key assumptions concerning the future, and other key
sources of estimation uncertainty at the balance sheet date,
that have a significant risk of causing a material adjustment
to the carrying amounts of assets and liabilities within the
ne$t financial year
The following disclosures re!uired by the previous version of
the +tandard have been omitted:
(a) the results of operating activities, and e$traordinary items, as
line items on the face of the income statement The revised
+tandard prohibits disclosure of ?e$traordinary items> in
financial statements;
(b) the number of an entity>s employees
8
8/12/2019 Comparison IFRS VAS
4/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 2 Inventories
9nventories should be valued at lower of historical cost and netrealisable value The benchmark cost formula is either F9F7 or
weighted average methods @9F7 is allowed as a permitted
alternative method Ahen @9F7 is used, difference between@9F7 method and benchmark treatment must be !uantified and
disclosed
!ote"9*+ 2 revised in ecember 2558 prohibits the use of the
@9F7 method This is effective for accounting periods
beginning on or after - 4anuary 2550
*+52 #In&entorieswas issued on 8- ecember 255-
9nventories should be valued at lower of historical cost and net
realisable value
F9F7, @9F7, specific identification and weighted average
methods are accepted @9F7 is treated e!ually to other methods
but it re!uires disclosure of the effect of using @9F7 in
comparison to F9F7 or weighted average
8/12/2019 Comparison IFRS VAS
5/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 6 Net profit or loss for the period, fundamental errors and
changes in accounting policies
%hanges in accounting policies or corrections of material errors
should lead to a restatement of comparatives and prior year
opening retained earnings The effect to current year income ofchanges in accounting policies should be disclosed fully
*llowed alternative treatments:
correction of a fundamental error can be made to the current
period CD@;
a change in accounting policy can be applied prospectively
when the effect of the change on prior periods cannot be
reasonably determined
!ote"9*+ 6 has been revised in ecember 2558 to: 9*+ 6,
Accountin po#icies( chanes in accountin estimates and errors
which is effective for accounting periods beginning on or after -
4anuary 2550 *mong other changes, the evised +tandard:
eliminates the use of the above allowed alternative
treatments;
eliminates the concept of a fundamental error; defines material omissions or misstatements, and
describes how to apply the concept of materiality when
applying accounting policies and correcting errors; and
re!uires, rather than encourages, disclosure of an
impending change in accounting policy (and its impact)
when an entity has yet to implement a new +tandard that
has been issued but not yet come into effect
* *+ based on 9*+ 6 has not yet been issued, so prior year
adjustments are currently not permitted
%hanges in accounting polices resulting from the adoption of a
*+ or &oF regulations should be accounted for in the current
year with detailed disclosures made in a note to the financial
statements
%orrection of material or fundamental errors is recorded in the
income statement of the current year
0
8/12/2019 Comparison IFRS VAS
6/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ -5 Events after the balance sheet date
%lear definition of adjusting and non1adjusting events *djustingevents are events where a circumstance has arisen prior to the
balance sheet date and the likelihood of a material financial
impact is high &aterial non1adjusting events or contingentliabilities should be disclosed
!ote"9*+ -5 has been revised in ecember 2558 to clarify that
if an entity declares a dividend after the balance sheet date, the
dividend is not a liability at the balance sheet date This is
effective for accounting periods beginning on or after - 4anuary
2550
.o specific +tandard or regulation on post balance sheet events
9*+ -- Construction contracts
evenue and e$penses on construction contracts should be
recognised using the percentage of completion method %ontract
costs should be recognised as e$penses as incurred
8/12/2019 Comparison IFRS VAS
7/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ -" Segmental reporting
eporting formats are classified into business segments andgeographical segments The dominant source and nature of the
entity>s risks and returns should be used to determine whether
the business or geographical segmental analysis is the ?primaryreporting format> The other basis of segmentation is the
?secondary reporting format> * segment is reportable if its
revenue, its result or assets are E-5 of the total base criteria
The reported segments should present at least B0 of the total
consolidated revenue
.o specific +tandard or regulation on segmental reporting
9*+ -0 Information reflecting the effects of changing prices
%ompliance to 9*+ -0 is optional and this standard will be
withdrawn with effect from - 4anuary 2550
+tate17wned
8/12/2019 Comparison IFRS VAS
8/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ -3 Propert, Plant and E!uipment
enchmark treatment is to carry fi$ed assets at historical costless depreciation and less any impairment losses
*lso an allowed alternative treatment of carrying fi$ed assets ata revalued amount (less depreciation and any subse!uent
impairment)
!ote"9*+ -3 has been revised in 2558 with effect for
accounting periods beginning on or after - 4anuary 2550
*mong other changes, the revised +tandard specifies that:
epreciation on CC< must be started as soon as the itemis available for use and to continue to depreciate even if
the item is idle
The cost of an item of CC< includes the costs of its
dismantlement, removal or restoration, the obligation for
which an entity incurs as a conse!uence of installing the
item
*n entity is re!uired to determine the depreciation
charge separately for each significant part of an item of
property, plant and e!uipment
*n entity is re!uired to derecognise the carrying amount
of a part of an item of CC< if that part has been replaced
and the entity has included the cost of the replacement in
the carrying amount of the item
*+58 # Tanib#e fi)ed assetswas issued on 8- ecember255-
Fi$ed assets should be carried at cost less depreciation
evaluation or write down for impairment is not allowed, unless
a specific approval is received from =overnment authorities
Gnder *+, fi$ed assets may be overstated in the balance sheet,
even when it is known that an impairment has occurred and the
current valuation is less than the carrying amount in the
accounts
epreciation is based on management>s assessment of e$pected
useful life, as per 9*+ -3
!ote"for Ta$ation purposes, depreciation on fi$ed assets isgenerally based on predetermined rates regulated by the &oF
6
8/12/2019 Comparison IFRS VAS
9/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ -B "eases
@eases are classified into finance leases and operating leasesdepending on the substance of the transaction rather than the
form of the contract
* finance lease is where risks and rewards are substantially
transferred to the lessee 7ther leases are operating leases
!ote"9*+ -B has been revised in 2558 with effect foraccounting periods beginning on or after - 4anuary 2550
*mong other changes, it clarifies that when classifying a lease of
land and buildings, an entity normally considers the land and
buildings elements separately:
the minimum lease payments are allocated between the
land and buildings elements in proportion to the relative fairvalues of the leasehold interests in the land and buildings
elements of the lease;
the land element is normally classified as an operating
lease unless title passes to the lessee at the end of the lease
term;
the buildings element is classified as an operating or
finance lease by applying the classification criteria in the
+tandard
*+53 #*easeswas issued on 8- ecember 2552
This +tandard is very similar to previous 9*+ -B
The section from 9*+ -B on recognition of revenue by
manufacture or dealer lessors has been omitted from *+53
* lease of @and Gse ights is usually classified as an operating
lease, with the lease payment amortised over the lease term
9*+ -6 #evenue
%onditions for recognition of revenues for sale of goods,
services interest, royalties and dividends are clearly defined For
sales, recognition is generally upon goods and services being
*+-" #Re&enue and other incomewas issued on 8- ecember
255-
/
8/12/2019 Comparison IFRS VAS
10/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
rendered to customers This +tandard is very similar to 9*+ -6
9*+ -/ Emploee benefits
9*+ -/ re!uires an enterprise to recognise contributions to a
defined contribution plan when an employee has rendered
service in e$change for those contributions
For defined benefit schemes, 9*+ -/ re!uires an enterprise to:
determine the present value of defined benefit obligations
and the fair value of any plan assets with sufficient
regularity that the amounts recognised in the financial
statements do not differ materially from the amounts that
would be determined at the balance sheet date;
use the Crojected Gnit %redit ðod to measure its
obligations and costs;
use unbiased and mutually compatible actuarial
assumptions about demographic variables and financial
variables;
determine the discount rate by reference to market yields at
the balance sheet date on high !uality corporate bonds
Termination benefits are employee benefits payable as a result ofan enterprise>s decision to terminate an employee>s employment
before the normal retirement date The event which gives rise to
an obligation is the termination rather than employee service
Therefore, an enterprise should recognise termination benefits
when, and only when, the enterprise is demonstrably committed
to terminate the employment of an employee
%ircular 00 re!uires a provision to be made for employees>
entitlement to severance payments, in accordance with the
current regulations of the +tate and the commitments in the
employment contract
9n practice, companies make a provision of one half month>s
current salary for each year of service for each employee # based
on the ietnam @abour %ode re!uirement for severance
payments in the event of an employee leaving the company
voluntarily or on the cessation of the company 9f the employeeleaves involuntarilyHdue to redundancy, the re!uirement is for a
full month>s current salary for each year of service
.o other specific re!uirement for disclosure of employee
benefits as a separate item in the financial statements
For +tate17wned
8/12/2019 Comparison IFRS VAS
11/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 25 $ccounting for government grants and disclosure ofgovernment assistance
=overnment grant may be of e!uity nature or of revenue nature
9n the income statement, government grants should be
recognised in order to match revenue to related costs provided
that the entity complies with covenants of the grant
9n the balance sheet, grants relating to fi$ed assets should be
recognised as deferred income or deducted from the related
assets
=overnment grants are normally accounted for into the entity>s
e!uity account
.o specific regulations on disclosure of government grants and
assistance
9*+ 2- %he effects of changes in foreign exchange rates
* transaction in a foreign currency is recorded in the reporting
currency using e$change rate ruling at the date of the
transaction
istinction is made between 'foreign operation that is integral to
the operations of the reporting enterprise or 'foreign entities
For a foreign operation that is integral to the operations of
the reporting enterprise, the transactions are translated as if
the transactions were those of the reporting enterprise itself;
For a foreign entity, the assets and liabilities are translated at
balance sheet date rate and fore$ differences are carried in
*+-5 # The effects of chanes in forein e)chane rateswas
issued on 8- ecember 2552
This +tandard is substantially similar to previous 9*+ 2-
.ote: during the construction phase of a new %ompany,
e$change differences arising are retained in an e!uity account,
until the time when the fi$ed assets are put into use Then they
are amortised to the income statement over a ma$imum period of
five years from the start of operations
--
8/12/2019 Comparison IFRS VAS
12/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 2-evised
e!uity
!ote"9*+ 2- has been revised in ecember 2558 with effect foraccounting periods beginning on or after - 4anuary 2550 There
are significant changes The focus is on determining the
'functional currency, which is the currency of the primaryeconomic environment in which the entity operates The entity
must determine its functional currency and measure its results
and financial position in that currency
The re!uirements in the previous version of 9*+ 2- for
distinguishing between foreign operations that are integral to the
operations of the reporting entity (referred to below as 'integral
foreign operations) and foreign entities are revised There!uirements are now among the indicators of an entity>s
functional currency *s a result:
there is no distinction between integral foreign operations
and foreign entities ather, an entity that was previously
classified as an integral foreign operation will have the same
functional currency as the reporting entity;
only one translation method is used for foreign operations 1
namely that described in the previous version of 9*+ 2- as
applying to foreign entities Gnder this method, assets and
liabilities are translated at the closing rate, and income and
e$penses are translated at the e$change rates at the dates ofthe transactions (or an average rate may be acceptable)
Ahere an entity chooses to use a 'presentation currency that isdifferent from its functional currency, the entity is re!uired to
translate its results and financial position from its functional
currency into the presentation currency using the same method
-2
8/12/2019 Comparison IFRS VAS
13/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
re!uired for translating a foreign operation for inclusion in the
reporting entity>s financial statements
9*+ 22replaced by
IFRS #
from
8- &arch 255"
&usiness combinations
+ee comments on 9F+ 8 later in this document
9*+ 28 &orrowing Costs
enchmark treatment is that borrowing costs should be e$pensed
in the period in which they are incurred
*llowed alternative treatment is the capitalisation of borrowing
costs if they are directly attributable to the ac!uisition,
construction or production of a !ualifying asset
*+-3 #+orro!in costswas issued on 8- ecember 2552
*+-3 applies the 9*+ 28 alternative treatment as its re!uiredtreatment
orrowing costs should be capitalised if they are directly
attributable to the ac!uisition, construction or production of a
!ualifying asset, and if it is probable that the costs will result in
future economic benefits to the enterprise and the costs can be
measured reliably 7ther borrowing costs should be recognised
as an e$pense when incurred
8/12/2019 Comparison IFRS VAS
14/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 2" #elated part disclosures
elated parties are determined by the level of direct or indirect
control or significant influence of one party over another, or the
common control of two parties
For relationships of control, disclosure is re!uired regardless of
whether transactions occur
!ote"9*+ 2" has been revised in 2558 with effect for
accounting periods beginning on or after - 4anuary 2550
*mong other changes:
disclosure is re!uired of compensation of key
management personnel;
definition of related parties has been
e$panded;
more e$tensive disclosure of related party
transactions
Creviously under *+, there had been no concept of related
parties Then in 2552, %ircular 00 re!uired some disclosures for
related party transactions, but did not give a definition of a
related party
*+23 #Re#ated party disc#osures was issued on 85 ecember
2558 This is very similar to the previous version of 9*+ 2"
9*+ 23 $ccounting and reporting b retirement benefit plans
eport on retirement benefit plans includes a statement of
changes in net assets available for benefits; summary of
significant accounting policies; a description of the plan and the
effect of any changes in the plans during the period
.ot mentioned in *+
-"
8/12/2019 Comparison IFRS VAS
15/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
efer to 9*+ -/ for appropriate accounting for cost of defined
benefit pension plan
9*+ 2B Consolidated financial statements and accounting for
investments in subsidiaries
efinition of subsidiary is based on voting control or dominant
influence over the entity
9nvestments in subsidiaries in the parent>s separate financial
statements should be accounted for using e!uity method or
recorded at cost or revalued amount under the parent>s
accounting policy for long term investment For consolidatedfinancial statements, see 9F+ 8 usiness %ombinations
9nvestment in subsidiaries in non1consolidated financial
statements should be accounted for as if they are investments
!ote"9*+ 2B has been revised in 2558: 9*+ 2B, 'onso#idated
and separate financia# statementsis effective for accounting
periods beginning on or after - 4anuary 2550
The evised +tandard modifies the e$emption from preparing
consolidated financial statements * parent need not presentconsolidated financial statements if:
the parent is itself a wholly1owned subsidiary, or the parent
is a partially1owned subsidiary of another entity and its other
owners, including those not otherwise entitled to vote, have
been informed about, and do not object to, the parent not
preparing consolidated financial statements;
*+20 1 'onso#idated financia# statements and accountin for
in&estment in subsidiaries was issued on 85 ecember 2558
This is similar to the previous version of 9*+ 2B The main
difference is that investments in subsidiaries in the parent>s
separate financial statements can only be carried at cost The
e!uity accounting method is not permitted
-0
8/12/2019 Comparison IFRS VAS
16/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 2B
evised(continued)
the parent>s debt or e!uity instruments are not traded in a
public market;
the parent did not file, nor is it in the process of filing, its
financial statements with a securities commission or other
regulatory organisation for the purpose of issuing any class
of instruments in a public market; and
the ultimate or any intermediate parent of the parent
produces consolidated financial statements available for
public use that comply with 9nternational Financial
eporting +tandards
The +tandard does not re!uire consolidation of a subsidiary
ac!uired when there is evidence that control is intended to betemporary Iowever there must be evidence that the subsidiary
is ac!uired with the intention to dispose of it within -2 months
*n entity is not permitted to e$clude from consolidation an
entity it continues to control simply because that entity is
operating under severe long1term restrictions that significantly
impair its ability to transfer funds to the parent %ontrol must be
lost for e$clusion to occur
-3
8/12/2019 Comparison IFRS VAS
17/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 26 $ccounting for investments in associates
efinition of associates is based on significant influence over the
entity
9nvestment in associates in consolidated financial statements
should be accounted for by the e!uity method, e$cept when it is
ac!uired with the intention to resell or it operates under long1
term restrictions 9n these cases the investment is accounted for
in accordance with 9*+ 8/
9nvestment in associates in non1consolidated financial
statements should be accounted for either:
at cost;
using the e!uity method; or
under 9*+ 8/
!ote"9*+ 26 has been revised in 2558: 9*+ 26, In&estments in
associatesis effective for accounting periods beginning on or
after - 4anuary 2550 *mong the changes are:
the +tandard clarifies that investments in associates over which
the investor has significant influence must be accounted for
using the e!uity method whether or not the investor also has
investments in subsidiaries and prepares consolidated
financial statements Iowever, the investor does not applythe e!uity method when presenting separate financial
*+5B 1 Accountin for in&estments in associates was issued
on 85 ecember 2558
This is similar to the previous version of 9*+ 26 The main
difference is that investments in associates in the investor>s
separate financial statements can only be carried at cost The
e!uity accounting method is not permitted in the investor>s own
financial statements
-B
8/12/2019 Comparison IFRS VAS
18/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
statements prepared in accordance with 9*+ 2B
clarifications on the e$emptions from applying the e!uity
method are as per 9*+ 2B revised
9*+ 2/ Financial reporting in hperinflationar economies
eports in the currency of a hyperinflationary economy should
be restated in terms of measuring unit current at the balancesheet date =ainHloss on net monetary position should be
included in the profit and loss and separately disclosed
.ot mentioned in *+
9*+ 85 'isclosures in the financial statements of banks and similarfinancial institution
This +tandard sets up detailed classification and disclosurere!uirements for banks and similar financial institutions
The +tate ank of ietnam ('+) is the regulator andsupervisor of the banking industry in ietnam The + has
issued a specific accounting system for banks and financial
institutions &any differences from 9*+ 85
9*+ 8- Financial reporting of interests in (oint ventures
4oint ventures can be structured as jointly controlled operations,jointly controlled assets or jointly controlled entities
For jointly controlled operationsHassets: venturer records its
share of the assets, liabilities, income and e$penses
For jointly controlled entities: in consolidated financial
*+56 1Financia# reportin of interests in joint &entureswasissued on 85 ecember 2558 This is similar to the previous
version of 9*+ 8- in respect of jointly controlled
operationsHassets 9t includes ietnam1specific references such
as %%s
The treatment of jointly controlled entities is different from 9*+
-6
8/12/2019 Comparison IFRS VAS
19/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 8-evised
statements of the venturer, proportionate consolidation is the
benchmark treatment and e!uity method is an allowed
alternative treatment There is no specific guidance on
accounting treatment in the venturer>s separate (non1consolidated) financial statements
!ote"9*+ 8- has been revised in 2558: 9*+ 8-, Interests injoint &enturesis effective for accounting periods beginning on or
after - 4anuary 2550 The changes include the same
clarifications on e$emptions from applying proportionate
consolidation or the e!uity method as per 9*+ 2B and 9*+ 26 9t
also specifies that the re!uirements for the preparation of the
investor>s separate financial statements are as per 9*+ 2B
8- Ahen a venturer prepares consolidated financial statements,
it accounts for its interest in the joint venture using the e!uity
method # not proportionate consolidation The venturer
accounts for its interest in the joint venture in its separatefinancial statements at cost
9*+ 82 Financial instruments) 'isclosure and presentation
Crescribes certain re!uirements for presentation of on1balance1
sheet financial instruments and identifies the information that
should be disclosed about both on1balance1sheet (recognised)
and off1balance1sheet (unrecognised) financial instruments
The presentation standards deal with the classification of
financial instruments between liabilities and e!uity, the
classification of related interest, dividends, losses and gains, and
the circumstances in which financial assets and financialliabilities should be offset
The disclosure standards deal with information about factors that
affect the amount, timing and certainty of an enterprise>s future
cash flows relating to financial instruments and the accounting
policies applied to the instruments
For foreign1invested enterprises, %ircular 00 of the &oF states
that disclosure of financial instruments is re!uired Iowever,
there are no details of the disclosure re!uirements
-/
8/12/2019 Comparison IFRS VAS
20/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 82evised
9n addition, the +tandard encourages disclosure of information
about the nature and e$tent of an enterprise>s use of financial
instruments, the business purposes that they serve, the risks
associated with them and management>s policies for controllingthose risks
!ote"9*+ 82 was revised in ecember 2558, the changes areeffective for accounting periods beginning on or after - 4anuary
2550 and include the following:
Ahen an issuer determines whether a financial instrument is a
financial liability or an e!uity instrument, the instrument is an
e!uity instrument if, and only if, both conditions (a) and (b) are
met
(a) The instrument includes no contractual obligation to
deliver cash or another financial asset to another entity; or
to e$change financial assets or financial liabilities with
another entity under conditions that are potentially
unfavourable to the issuer
(b) 9f the instrument will or may be settled in the issuer>s own
e!uity instruments, it is:
(i) a non1derivative that includes no contractual obligation
for the issuer to deliver a variable number of its own
e!uity instruments; or(ii) a derivative that will be settled by the issuer
e$changing a fi$ed amount of cash or another financialasset for a fi$ed number of its own e!uity instruments
The definitions of a financial asset and a financial liability, and
the description of an e!uity instrument, are amended consistently
25
8/12/2019 Comparison IFRS VAS
21/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
with this principle
The re!uirements for separating the liability and e!uity
components of a compound financial instrument are conformedto both the definition of an e!uity instrument as a residual and
the measurement re!uirements in 9*+ 8/
9*+ 88 Earnings per share
.umerator in basic earnings per share ('
8/12/2019 Comparison IFRS VAS
22/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
ne$t annual financial statements .o re!uirement to publish
interim financial report
financial reports, should follow *+ in these reports
9*+ 80 'iscontinued operations
+pecific disclosure is re!uired for sale or abandonment that
represents a separate, major line of business of an entity and of
which the assets, net profit or loss and activities can be
distinguished physically or operationally
!ote"9F+ 0,,on-current assets he#d for sa#e and discontinuedoperationswas issued on 8- &arch 255" and is effective for
accounting periods beginning on or after - 4anuary 2550
9F+ 0 supersedes 9*+ 80 +ee comments on 9F+ 0 later in
this document
.ot specifically mentioned under *+
9n practice, the &oF re!uires disclosure on the closing down of
an entity>s operations For companies that are being wound up,
financial statements are prepared under the same accounting
basis as they were when fully operational Therefore, thehistorical cost convention is still applied to companies which are
being wound up, which may lead to assets being stated at the
report>s date in e$cess of the amount at which they are
subse!uently realised
9*+ 83evised
8- &arch 255"
Impairment of assets
The revised 9*+ 83 applies to goodwill or intangible assets
ac!uired in an ac!uisition after 8- &arch 255", and for all other
assets for accounting periods beginning on or after 8- &arch
255"
9*+ 83 has been revised as part of the project on usiness
%ombinations that has seen the release of 9F+ 8
*+ does recognise diminution in value of certain current
assets
=enerally, impairment of tangibleHintangible fi$ed assets is not
permitted
22
8/12/2019 Comparison IFRS VAS
23/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 83
evised
(continued)
The previous version of 9*+ 83 re!uired the recoverable amount
of an asset to be measured whenever there is an indication that
the asset may be impaired This re!uirement is included in the
evised +tandard Iowever, the evised +tandard also re!uires:
the recoverable amount of an intangible asset with an
indefinite useful life to be measured annually, irrespective
of whether there is any indication that it may be impaired
The most recent detailed calculation of recoverable amount
made in a preceding period may be used in the impairment
test for that asset in the current period, provided specified
criteria are met
the recoverable amount of an intangible asset not yet
available for use to be measured annually, irrespective of
whether there is any indication that it may be impaired
goodwill ac!uired in a business combination to be tested
for impairment annually
The evised +tandard gives guidance on calculation of an
asset>s value in use and guidance on using reasonable cash flow
projections for this calculation
.ew guidance is given on allocating goodwill to cash1generating
units as part of impairment testing the cash1generating unit(s) to
which it relates
*lso new guidance on timing of the annual impairment tests for
goodwill
28
8/12/2019 Comparison IFRS VAS
24/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
The evised +tandard prohibits the recognition of reversals of
impairment losses for goodwill
9*+ 8B Provisions, contingent liabilities and contingent assets
9*+ 8B defines provisions as liabilities of uncertain timing or
amount * provision should be recognised when, and only
when:
an enterprise has a present obligation (legal or
constructive) as a result of a past event;
it is probable (ie more likely than not) that an outflow of
resources embodying economic benefits will be re!uired to
settle the obligation; and
a reliable estimate can be made of the amount of the
obligation The +tandard notes that it is only in e$tremelyrare cases that a reliable estimate will not be possible
The amount recognised as a provision should be the bestestimate of the e$penditure re!uired to settle the present
obligation at the balance sheet date
9*+ 8B e$plains how the general recognition and measurement
re!uirements for provisions should be applied in three specific
cases: future operating losses; onerous contracts; and
restructurings
Crovisions should not be recognised for future operating
.o +tandard has been issued on provisions and contingencies
The re!uirement to make provisions is described in certain
regulations, for e$ample: %ircular 00 mentions provision for
accrued retirement benefits
%ontingencies are mentioned in *+2-,$resentation of
financia# statements, but no specific accounting guidance has
been issued
2"
8/12/2019 Comparison IFRS VAS
25/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 8B
(continued)
losses
9f an enterprise has a contract that is onerous, the present
obligation under the contract should be recognised and
measured as a provision
* provision for restructuring costs is recognised only when
the general criteria for provisions are met
* contingent liability is defined as:
a possible obligation that arises from past events and whose
e$istence will be confirmed only by the occurrence or non1
occurrence of one or more uncertain future events not wholly
within the control of the enterprise; or
a present obligation that arises from past events but is not
recognised because:
(i) it is not probable that an outflow of resources embodying
economic benefits will be re!uired to settle theobligation; or
(ii) the amount of the obligation cannot be measured with
sufficient reliability
*n enterprise should not recognise a contingent liability *nenterprise should disclose a contingent liability, unless thepossibility of an outflow of resources embodying economic
benefits is remote
* contingent asset is defined as a possible asset that arises from
past events and whose e$istence will be confirmed only by the
occurrence or non1occurrence of one or more uncertain future
20
8/12/2019 Comparison IFRS VAS
26/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
events not wholly within the control of the enterprise
*n enterprise should not recognise a contingent asset *
contingent asset should be disclosed where an inflow of
economic benefits is probable
9*+ 86
evised
8- &arch 255"
Intangible assets
The revised 9*+ 86 applies to intangible assets ac!uired in an
ac!uisition after 8- &arch 255", and for all other assets for
accounting periods beginning on or after 8- &arch 255"
The previous version of 9*+ 86 defined an intangible asset as an
identifiable non1monetary asset without physical substance held
for use in the production or supply of goods or services, for
rental to others, or for administrative purposes The re!uirementfor the asset to be held for use in the production or supply of
goods or services, for rental to others, or for administrative
purposes has now been removed from the definition of an
intangible asset
The previous version of 9*+ 86 did not define 'identifiability,
but stated that an intangible asset could be distinguished clearlyfrom goodwill if the asset was separable, but that separability
was not a necessary condition for identifiability The evised
+tandard states that an asset meets the identifiability criterion in
the definition of an intangible asset when it:
(a) is separable, ie capable of being separated or divided from
the entity and sold, transferred, licensed, rented or
*+5" #Intanib#e fi)ed assetswas issued on 8- ecember
255-
This +tandard is substantially similar to the previous version of9*+ 86, so there are now significant differences between the
revised 9*+ 86 and *+5"
9f the definition of an asset met, intangible assets must beamortised over useful life, which should be no longer than 25
years, unless there is persuasive evidence that a life over 25
years is appropriate
evaluation or write down for impairment is not allowed Gnder
*+, intangible fi$ed assets may be overstated in the balance
sheet, even when it is known that an impairment has occurredand the current valuation is less than the carrying amount in the
accounts
%ertain pre1operating costs, in relation to an entity>s
establishment, training, advertisement activities, research andrelocation of a business are allowed to be deferred and charged
23
8/12/2019 Comparison IFRS VAS
27/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 86
evised
(continued)
e$changed, either individually or together with a related
contract, asset or liability; or
(b) arises from contractual or other legal rights, regardless of
whether those rights are transferable or separable from the
entity or from other rights and obligations
The previous version of 9*+ 86 re!uired an intangible asset to be
recognised if, and only if, it was probable that the e$pectedfuture economic benefits attributable to the asset would flow to
the entity, and its cost could be measured reliably These
recognition criteria have been included in the evised +tandard
Iowever, additional guidance has been included to clarify that:(a) the probability recognition criterion is always considered to
be satisfied for intangible assets that are ac!uired separately
or in a business combination
(b) the fair value of an intangible asset ac!uired in a business
combination can normally be measured with sufficient
reliability to be recognised separately from goodwill 9f an
intangible asset ac!uired in a business combination has a
finite useful life, there is a rebuttable presumption that its fair
value can be measured reliably
The previous version of 9*+ 86 was based on the assumption
that the useful life of an intangible asset is always finite, andincluded a rebuttable presumption that the useful life cannot
e$ceed twenty years from the date the asset is available for use
That rebuttable presumption has been removed The evised
+tandard re!uires an intangible asset to be regarded as having an
indefinite useful life when, based on an analysis of all of the
over 8 years
2B
8/12/2019 Comparison IFRS VAS
28/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 86
evised
(continued)
relevant factors, there is no foreseeable limit to the period over
which the asset is e$pected to generate net cash inflows for the
entity
The evised +tandard re!uires that:
(a) an intangible asset with an indefinite useful life should not
be amortised
(b) the useful life of such an asset should be reviewed each
reporting period to determine whether events and
circumstances continue to support an indefinite useful lifeassessment for that asset 9f they do not, the change in the
useful life assessment from indefinite to finite should be
accounted for as a change in an accounting estimate
The previous version of 9*+ 86 re!uired the recoverable amount
of an intangible asset that was amortised over a period e$ceeding
twenty years from the date it was available for use to be
estimated at least at each financial year1end, even if there was noindication that the asset was impaired This re!uirement has
been removed Therefore, an entity needs to determine the
recoverable amount of an intangible asset with a finite useful lifethat is amortised over a period e$ceeding twenty years from the
date it is available for use only when, in accordance with 9*+
83, there is an indication that the asset may be impaired
26
8/12/2019 Comparison IFRS VAS
29/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 8/ Financial instruments) recognition and measurement
@iabilities versus e!uity: the classification between liabilities
and e!uity depends on whether the issuer has a contractual
obligation to deliver cash or another financial asset to the holder
of the instrument, regardless of its legal form
erivatives: all derivatives must be carried at fair value =ains
or losses on all derivatives are recorded in income unless they
!ualify for cash flow hedge accounting when such gains or
losses are deferred in e!uity
Financial assets: should be initially measured at cost, being the
fair value of the consideration given, including transaction costs
There are only four categories of financial assets under 9*+ 8/:
held for trading, held to maturity, originated by the enterprise
and available for sale
Financial liabilities: should be initially measured at cost, beingthe fair value of the consideration received, including transaction
costs *ll financial liabilities e$cept for held for trading and
derivatives that are liabilities should be carried at amortised cost
@iabilities held for trading and derivatives that are liabilities
should be measured at fair value
.o specific rules on financial instruments
*+-5 # The effects of chanes in forein e)chane ratesand
%ircular 00 both include a statement that where financial
instruments are used to hedge against foreign e$change risk,the foreign currency loanHliability should not be retranslated
The meaning of this statement is not clear, and has not been
tested in practice
2/
8/12/2019 Comparison IFRS VAS
30/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 8/
(continued)
7ffsetting: the ability to offset financial assets and liabilities is
severely restricted
Iedge accounting: may be used only if the hedge relationship
meets !ualifying criteria of documentation and hedge
effectiveness There must be a one1on1one hedging relationship;
hedge accounting may not be used for overall balance sheet
positions =ains or losses on instruments !ualifying as cash flow
hedges should be included in e!uity and recycled to the income
statement when the hedged transaction or balance effects theincome statement, or is used to adjust the carrying amount of an
asset or liability at ac!uisition
erecognition: a financial asset should be derecognised whenthe enterprise realises the rights to benefits specified in the
contract, the rights e$pire, or the enterprise loses control of the
contractual rights * financial liability should only be removed
from the balance sheet when the obligation specified in the
contract is discharged, cancelled, e$pires, or the primary
responsibility for the liability is transferred to another party
!ote"9*+ 8/ was revised in ecember 2558, the changes are
effective for accounting periods beginning on or after - 4anuary
2550 and include the following:
The definition of 'originated loans and receivables is amendedto become 'loans and receivables Gnder the revised definition,
85
8/12/2019 Comparison IFRS VAS
31/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 8/
evised
(continued)
an entity is permitted to classify as loans and receivables
purchased loans that are not !uoted in an active market
The evised +tandard clarifies that the evaluation of the transfer
of risks and rewards of ownership precedes the evaluation of thetransfer of control for all derecognition transactions &ore
guidance is given on derecognition of financial assets
The evised +tandard introduces the notion of a 'transfer of a
financial asset and gives rules to define when a transfer has
occurred 9t also provides guidance on how to apply the
concepts of risks and rewards and of control
The option previously contained in 9*+ 8/ to recognise in profit
or loss gains and losses on available1for1sale financial assets hasbeen eliminated +uch an option is no longer necessary becauseunder the amendments to 9*+ 8/ an entity is now permitted by
designation to measure any financial asset or financial liability at
fair value with gains and losses recognised in profit or loss
The evised +tandard provides additional guidance about how
to evaluate impairment that is inherent in a group of loans,
receivables or held1to1maturity investments, but cannot yet be
identified with any individual financial asset in the group
Iedges of firm commitments are now treated as fair value
hedges rather than cash flow hedges Iowever, the evised+tandard clarifies that a hedge of the foreign currency risk of a
firm commitment can be treated as either a cash flow hedge or a
fair value hedge
The evised +tandard re!uires that when a hedged forecast
transaction occurs and results in the recognition of afinancia#
asset or afinancia#liability, the gain or loss deferred in e!uity
8-
8/12/2019 Comparison IFRS VAS
32/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ 8/
evised
(continued)
does not adjust the initial carrying amount of the asset or liability
(ie basis adjustment is prohibited), but remains in e!uity and is
recognised in profit or loss consistently with the recognition of
gains and losses on the asset or liability
For hedges of forecast transactions that result in the recognition
of a non-financia#asset or a non-financia#liability, the entity has
a choice of whether to apply basis adjustment or retain the
hedging gain or loss in e!uity and report it in profit or loss when
the asset or liability affects profit or loss
The disclosure re!uirements previously in 9*+ 8/ have beenmoved to 9*+ 82
9*+ "5 Investment propert
9nvestment property is defined as property (land or a building 1
or part of a building 1 or both) held (by the owner or by the
lessee under a finance lease) to earn rentals or for capital
appreciation or both, rather than for:
(a) use in the production or supply of goods or services or for
administrative purposes; or
(b) sale in the ordinary course of business
9*+ "5 permits enterprises to choose either:
(a) a fair value model: investment property should be measured
at fair value and changes in fair value should be recognised
*+50 1In&estment property( was issued on 85 ecember 2558
The +tandard is based on the structure of 9*+ "5, but has the
fundamental difference that investment property can only be
measured at depreciated historical cost
&easurement at fair value is not permitted
82
8/12/2019 Comparison IFRS VAS
33/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ "5
(continued)
in the income statement; or
(b) a cost model The cost model is the benchmark treatment in
9*+ -3$roperty( $#ant and %uipment: investment property
should be measured at depreciated cost (less anyaccumulated impairment losses) *n enterprise that chooses
the cost model should disclose the fair value of its
investment property
Gnder the fair value model, all changes in fair value are
recognised in the income statement
9f there is clear evidence when an enterprise first ac!uires an
investment property that the fair value of the property will not be
able to be reliably measured on a continuing basis, then that
investment property is measured using the depreciated cost
model under 9*+ -3 until it is disposed of
!ote"9*+ "5 was revised in ecember 2558, the changes are
effective for accounting periods beginning on or after - 4anuary
2550 This is a limited revision that includes the following:
* property interest that is held by a lessee under an operatinglease may be classified and accounted for as investment property
provided that:
(a) the rest of the definition of investment property is met;
(b) the operating lease is accounted for as if it were a financelease in accordance with 9*+ -B*eases; and
(c) the lessee uses the fair value model set out in 9*+ "5 for the
asset recognised
88
8/12/2019 Comparison IFRS VAS
34/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ "5
evised
(continued)
The evised +tandard re!uires an entity to disclose:
(a) whether it applies the fair value model or the cost model; and
(b) if it applies the fair value model, whether, and in what
circumstances, property interests held under operating leases
are classified and accounted for as investment property
Ahen a valuation obtained for investment property is adjusted
significantly for the purpose of the financial statements, areconciliation is re!uired between the valuation obtained and the
valuation included in the financial statements
7ther changes have been incorporated into the evised 9*+ "5as a result of amendments to 9*+ -3:$roperty( $#ant and
%uipment.
8"
8/12/2019 Comparison IFRS VAS
35/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9*+ "- $griculture
9*+ "- deals with accounting for agricultural activity This isdefined as the managed biological transformation of biological
assets (living animals and plants) for sale, into agricultural
produce (harvested product of biological assets) or intoadditional biological assets
*ll biological assets should be measured at fair value less
estimated point1of1sale costs, with the change in the carrying
amount reported as part of profit or loss from operating
activities *gricultural produce harvested from an enterprise>s
biological assets should be measured at fair value less estimated
point1of1sale costs at the point of harvest The fair value is the!uoted price in any available market
.ot specifically mentioned under *+
9F+ -
8/12/2019 Comparison IFRS VAS
36/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9F+ -
(continued)
following in the opening 9F+ balance sheet that it prepares as a
starting point for its accounting under 9F+s:
(a) recognise all assets and liabilities whose recognition is
re!uired by 9F+s;
(b) not recognise items as assets or liabilities if 9F+s do not
permit such recognition;
(c) reclassify items that it recognised under previous =**C as
one type of asset, liability or component of e!uity, but are a
different type of asset, liability or component of e!uity under
9F+s; and
(d) apply 9F+s in measuring all recognised assets and
liabilities
9F+ - grants limited e$emptions from these re!uirements inspecified areas where the cost of complying with them would be
likely to e$ceed the benefits to users of financial statements;
including e$emption from restating business combinations,
taking fair value as deemed cost for fi$ed assets, and e$emption
from calculating cumulative translation differences
9F+ - also prohibits retrospective application of 9F+s in some
areas; including where retrospective application would re!uirejudgements by management about past conditions after the
outcome of a particular transaction is already known,derecognition of financial assets and financial liabilities, and
hedge accounting
9F+ - re!uires disclosures that e$plain how the transition from
previous =**C to 9F+s affected the entity>s reported financial
83
8/12/2019 Comparison IFRS VAS
37/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
position, financial performance and cash flows
*n entity is re!uired to apply the 9F+ if its first 9F+ financial
statements are for a period beginning on or after - 4anuary 255"
8/12/2019 Comparison IFRS VAS
38/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
For e!uity1settled share1based payment transactions, an entity
measures the goods or services received, and the corresponding
increase in e!uity, directly, at the fair value of the goods or
services received, unless that fair value cannot be estimated
reliably
For cash1settled share1based payment transactions, an entity
measures the goods or services ac!uired and the liability
incurred at the fair value of the liability Gntil the liability is
settled, the entity is re!uired to remeasure the fair value of theliability at each reporting date and at the date of settlement, with
any changes in value recognised in profit or loss for the period
For share1based payment transactions in which the terms of the
arrangement provide either the entity or the supplier of goods or
services with a choice of whether the entity settles thetransaction in cash or by issuing e!uity instruments, the entity is
re!uired to account for that transaction, or the components of
that transaction, as a cash1settled share1based payment
transaction if, and to the e$tent that, the entity has incurred a
liability to settle in cash (or other assets), or as an e!uity1settled
share1based payment transaction if, and to the e$tent that, no
such liability has been incurred
9F+ 8
8/12/2019 Comparison IFRS VAS
39/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9F+ 8
(continued)
aggregate of: the fair values, at the date of e$change, of assets
given, liabilities incurred or assumed, and e!uity instruments
issued by the ac!uirer, in e$change for control of the ac!uiree;
plus any costs directly attributable to the combination
*c!uirer recognises separately, at the ac!uisition date, the
ac!uiree>s identifiable assets, liabilities and contingent liabilities
that satisfy the following recognition criteria at that date,
regardless of whether they had been previously recognised in the
ac!uiree>s financial statements:
(i) in the case of an asset other than an intangible asset, it is
probable that any associated future economic benefits will
flow to the ac!uirer, and its fair value can be measured
reliably;
(ii) in the case of a liability other than a contingent liability, it is
probable that an outflow of resources embodying economic
benefits will be re!uired to settle the obligation, and its fair
value can be measured reliably; and
(iii) in the case of an intangible asset or a contingent liability, its
fair value can be measured reliably
The identifiable assets, liabilities and contingent liabilities that
satisfy the above recognition criteria are measured initially bythe ac!uirer at their fair values at the ac!uisition date,
irrespective of the e$tent of any minority interest
=oodwill ac!uired in a business combination is recognised by
the ac!uirer as an asset from the ac!uisition date, initially
measured as the e$cess of the cost of the business combination
over the ac!uirer>s interest in the net fair value of the ac!uiree>s
recognised as a deferred revenue and amortised to the income
statement over its useful life
8/
8/12/2019 Comparison IFRS VAS
40/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
identifiable assets, liabilities and contingent liabilities
=oodwill is not amortised 9t is tested for impairment at least
annually, or more fre!uently if events indicate that the asset
might be impaired
9F+ "
8/12/2019 Comparison IFRS VAS
41/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
9F+ "
(continued)
*n insurer is permitted to change its accounting policies for
insurance contracts only if, as a result, its financial statements
present information that is more relevant and no less reliable, or
more reliable and no less relevant 9n particular, an insurer
cannot introduce any of the following practices, although it may
continue using accounting policies that involve them:
(a) measuring insurance liabilities on an undiscounted basis
(b) measuring contractual rights to future investment
management fees at an amount that e$ceeds their fair value
as implied by a comparison with current fees charged byother market participants for similar services
(c) using non1uniform accounting policies for the insuranceliabilities of subsidiaries
9F+ " permits the introduction of an accounting policy that
involves remeasuring designated insurance liabilities
consistently in each period to reflect current market interest rates
(and, if the insurer so elects, other current estimates and
assumptions) Aithout this permission, an insurer would have
been re!uired to apply the change in accounting policies
consistently to all similar liabilities
9F+ ":
(a) clarifies that an insurer need not account for an embedded
derivative separately at fair value if the embedded derivativemeets the definition of an insurance contract
(b) re!uires an insurer to unbundle deposit components of some
insurance contracts, to avoid the omission of assets and
liabilities from its balance sheet
"-
8/12/2019 Comparison IFRS VAS
42/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
(c) clarifies the applicability of the practice sometimes known as
'shadow accounting
(d) permits an e$panded presentation for insurance contracts
ac!uired in a business combination or portfolio transfer
(e) addresses limited aspects of discretionary participation
features contained in insurance contracts or financial
instruments
9F+ " re!uires disclosure to help users understand:
(a) the amounts in the insurer>s financial statements that arise
from insurance contracts
(b) the amount, timing and uncertainty of future cash flows from
insurance contracts
9F+ 0
8/12/2019 Comparison IFRS VAS
43/43
Summary of differences between International Financial Reporting Standards (IFRS) and the Vietnamese Accounting System (VAS)
IFRS Ref IFRS VAS
*ssets or disposal groups that are classified as held for
sale are carried at the lower of carrying amount and fair
value less costs to sell
*n asset classified as held for sale, or included within a
disposal group that is classified as held for sale, is not
depreciated
*n asset classified as held for sale, and the assets and
liabilities included within a disposal group classified as
held for sale, are presented separately on the face of the
balance sheet
*n operation is classified as discontinued at the date the
operation meets the criteria to be classified as held for sale or
when the entity has disposed of the operation
esults of discontinued operations are to be shown
separately on the face of the income statement
etroactive classification of an operation as discontinued
is not permitted, when the criteria for that classification
are not met until after the balance sheet date
historical cost convention is still applied to companies which are
being wound up, which may lead to assets being stated at the
report>s date in e$cess of the amount at which they are
subse!uently realised