CIRCULAR NO. 200/2014/TT-BTC OF THE MINISTRY OF FINANCE (MOF) PROVIDING GUIDANCE ON VIETNAMESE ACCOUNTING SYSTEM FOR ENTERPRISES
On 22 December 2014, the Ministry of Finance issued Circular No. 200/2014/TT-BTC providing guidance on Vietnamese Accounting System (Circular 200). Circular 200 replaces Decision No. 15/2006-QD/BTC dated 20 March 2006 (Decision 15) and Circular No. 244/2009/TTBTC dated 31 December 2009. The circular introduced a number of changes to the accounting and financial reporting requirements applicable to all enterprises in all economic sectors. This Financial Reporting Alert summarizes the important changes brought by this new circular.
Current vs. non-current presentation
The previous guidance in Decision 15 was not clear about whether or not the current portions of long-term liabilities other than long-term borrowings should be classified as current liabilities. Circular 200 provides a clarified requirement that, for financial statement presentation purpose, assets or liabilities of which the remaining period from the reporting date to maturity is 12 months or less should be presented as current assets or current liabilities. For bookkeeping purpose, a number of current and non-current accounts previously specified for current and non-current assets and liabilities with the same nature have been combined. The intention of this change is to simplify the chart of accounts and to reflect the principle that current vs. non-current classification is only a matter of presentation.