Quyết định 16/2007/QD-NHNN

DECISION

ON THE ISSUANCE OF THE REGIME ON FINANCIAL STATEMENTS APPLICABLE TO CREDIT INSTITUTIONS

THE GOVERNOR OF THE STATE BANK

Pursuant to the Law on the State Bank of Vietnam in 1997 and the Law on amendment, supplement of several Articles of the Law on the State Bank of Vietnam in 2003;
Pursuant to the Law on Credit Institutions in 1997 and the Law on amendment, supplement of several Articles of the Law on Credit Institutions in 2004;
Pursuant to the Law on Accounting in 2003;
Pursuant to the Decree No. 52/2003/ND-CP dated 19 May 2003 of the Government providing for the function, assignment, authority and organizational structure of the State Bank of Vietnam;
Being approved by the Ministry of Finance in the Official Dispatch No. 1547/BTC- CDKT dated 29 January 2007;
Upon the proposal of the Director of the Finance and Accounting Department,

DECIDES:

Article 1. To issue in conjunction with this Decision “the Regime on financial statements applicable to credit institutions”.

Article 2. This Decision shall be effective after 15 days since its publication in Official Gazette (starting to apply to Financial Statement of Quarter II/2007) and replace the Decision No. 1145/2002/QD-NHNN dated 18 October 2002 on the issuance of the Regime on financial statement applicable to credit institutions, Decision No. 1407/2004/QD-NHNN dated 1 November 2004 on the issuance of Regulation on disclosure of financial statements of joint stock commercial banks, Decision No. 09/2006/QD-NHNN dated 20 February 2006 on the amendment of the Regulation on disclosure of financial statements of joint stock commercial banks.

Article 3. The Director of Administrative Department, the Director of the Finance and Accounting Department, Heads of related units of the State Bank of Vietnam, General Managers of the State Bank branches in provinces, cities under the central Government’s management, Chairperson of the Board of Directors and General Directors (Directors) of credit institutions shall be responsible for the implementation of this Decision.

REGIME

ON FINANCIAL STATEMENTS APPLICABLE TO CREDIT INSTITUTIONS
(issued in conjunction with the Decision No. 16/2007/QD-NHNN dated 18 April 2007 of the Governor of the State Bank)

Chapter 1.

GENERAL PROVISIONS

Article 1. Governing scope and subjects of application

1. This Regulation provides for content, method of preparation, presentation and other contents related to Financial Statements of credit institutions (CIs) established, organized and operating in accordance with provisions of the Law on Credit Institutions in 1997 and the Law on amendment, supplement of several articles of the Law on credit institutions in 2004.

Financial statements of CIs (hereinafter referred to as financial statements) shall be those prepared in accordance with Vietnamese Accounting Standards and current Accounting Regime to reflect major economic, financial information of CIs. System of financial statements for CIs includes: Balance Sheet, Profit/Loss Statement, Cash Flow Statement and Notes to Financial Statement.

2. This Financial Statement Regime shall also provide for the preparation and sending of the statement of accounts by credit institutions.

3. Operational reports, statistic reports and other reports for the purpose of administering and executing CI’s activities (including administration accounting report) shall not be governed by this Regime.

4. This financial statement regime shall not be applicable to Local People’ Credit Fund. Financial statement regime applicable to Local People’s Credit Fund shall be guided by State Bank in another document based on the employment of provisions in this financial statement Regime.

Article 2. Interpretation

In this Regime, following terms shall be construed as follows:

1. CI is an enterprise established, organized and operating in accordance with the Law on Credit Institutions, including State owned CIs, joint stock CIs, Central People’s Credit Fund, joint venture CIs, foreign bank branches in Vietnam, 100% foreign owned CIs established and operating in Vietnam.

2. Unit of CI mean the units subject to a CI, including Head Office, Transaction Department, branches and subsidiary units which perform dependent accounting.

3. Financial Statement of CI is the financial statement prepared by a legal entity being CI on the basis of consolidating the data within the entire system of the CI (including Head Office, Transaction Department, branches and subsidiary units which perform dependent accounting) to reflect economic, financial information of the CI legal entity thereof.

4. Financial Statement of CI Group is the one prepared on the basis of integration of the financial statements of CI and its subsidiary companies to reflect economic, financial information of the CI group.

5. Parent company means a CI which has one or several subsidiary companies;

6. Subsidiary company means the enterprise which is subject to the control of a CI;

7. CI group includes the parent company being CI and its subsidiary company (ies).

Article 3. Principles for the preparation of financial statement

The preparation and presentation of financial statement must comply with six (06) principles stipulated in Vietnamese Accounting Standard No. 21 - Presentation of financial statement: (i) Operating continuously, (ii) on the basis of accrual, (iii) Consistency, (iv) essentiality and consolidation, (v) clearing, (vi) comparableness and additional requirements, provisions in Vietnamese Accounting Standard No. 22 - Additional presentation of financial statement of banks and similar finance institutions. CIs also have to implement the contents specifically provided for in other related Vietnamese Accounting Standards.

Article 4. Purposes of financial statement

Financial statement is used for providing information of financial status, business situation and cash flows of a CI, satisfying management requirements of CI’s leadership, state management agencies and useful demands of users in making economic decisions. The financial statement must provide information of a CI concerning:

1. Assets;

2. Payable debts and owner capital;

3. Revenue, other incomes, business expense and other expenses;

4. Profits, losses and distribution of business result;

5. Taxes and payables to the State;

6. Other assets related to accounting units;

7. Cash flows

Besides above mentioned information, the CI also has to provide other related information in the “Notes to financial statement” for further explanation about the norms shown on financial statements and applied accounting policies to acknowledge arisen economic operations, prepare and present financial statement and make further explanation of seriousness of major financial risks.

Article 5. Period of preparation of financial statement

1. Period of preparation of annual financial statement

CIs shall have to prepare financial statement under annual accounting period being calendar year or under annual accounting period being 12 months in accordance with provisions of current laws. In special case, CIs shall be permitted to change the ending day of an annual accounting period that makes the first year’s accounting period or the last year’s accounting period shorter or longer than 12 months but not in excess of 15 months.

2. Period of preparation of mid-annual financial statement

Period of preparation of mid-annual financial statement shall be each quarter of the fiscal year (quarter IV excluded)

3. Other period of financial statement preparation

a. CIs may prepare financial statement according to other accounting periods upon request of applicable laws, of parent company or of the owner.

b. CIs which are splitted, separated, integrated, merged, transformed in terms of owning form, dissolved, bankrupt or of which operation is terminated, shall have to prepare financial statements at the time of splitting, separation, integration, mergence, transformation of owning form, dissolution, operation termination, bankruptcy.

Article 6. Financial statement preparing unit

1. Annual financial statement

a. CI shall prepare form of financial statements to reflect economic, financial information of the CI legal entity in accordance with the form stipulated in Section 1 - Financial Statement- Chapter II of this Regime.

b. Where a foreign bank has from 2 branches operating and performing independent accounting in Vietnam, of which one branch is authorized/designated to act as a coordinating/representative branch, (i) branches shall carry out the reporting in accordance with provisions in Article 9, (ii) that coordinating/representative branch shall be obliged to consolidate data of the branches operating in Vietnam for drawing a consolidated financial statement in accordance with provisions in Section 3 - Consolidated Financial Statement, Chapter II of this Regime.

c. Where a CI has one or several subsidiary companies: besides the implementation of financial statement preparation as provided for in point a, paragraph 1 of this Article, it shall have to draw a unified Financial Statement of the group as provided for in Section 2- Unified Financial Statement, Chapter II of this Regime.

2. Mid-annual financial statement

a. CIs shall draw forms of financial statements in accordance with provisions in Section 4 - Mid-annual Financial Statement, Chapter II of this Regime.

b. Foreign bank branch which is designated to be a coordinating branch shall be responsible for consolidating the data of the branches, preparing consolidated financial statement in accordance with provisions in Section 4 - Mid-annual Financial Statement, Chapter II of this Regime.

c. Where a CI has one or several subsidiary companies: besides the implementation of financial statement preparation as provided for in point a, paragraph 2 of this Article, it shall have to draw a mid-annual unified financial statement of the CI group as provided for in Section 4- Mid-annual financial statement, Chapter II of this Regime.

Article 7. Time limit for submitting financial statement

1. Annual financial statement

a. Time limit for submitting the annual financial statement shall be 90 days at the latest since the ending of the fiscal year of the CI.

b. CI must send its audited annual financial statement enclosed with the conclusion made by the independent audit firm (audit report) to the State Bank right after the audit activity ends.

2. Mid-annual financial statement

Time limit for submitting mid-annual financial statement shall be on 30th of the fist month of the next quarter at the latest.

If the last day of the time limit for submitting financial statement falls on a holiday, Tet holiday or weekend, the day for submitting financial statement shall be on the working day following that day at the latest.

Article 8. Financial statement receiving unit

Article 9. Preparation and submission of Statement of accounts

1. Statement of accounts is an accounting report reflecting detailed financial status and operation of the CI and/or CI unit (Form A01/TCTD). On monthly basis, CIs, units of CI shall have to prepare and submit a Statement of accounts to the State Bank under following provisions:

a. Monthly, CIs must prepare and send the Statement of accounts (both in written and electronic form) to the State Bank on the 10th of the next month at the latest.

b. Monthly, units of CI must prepare and send the Statement of accounts (both in written and electronic form) to the State Bank branches in provinces, cities under the central Government’s management where units of CI are located on the 7th of the next month at the latest.

2. Requirements for the preparation of the Statement of accounts

a. Where incomes and expenses arise from transactions among units of CI in the same system, the CI should enclose the notes to incomes and expenses hereof upon preparing and submitting the Statement of accounts.

b. Except for the Statement of accounts of December (or the last month of the annual accounting period in accordance with provisions of applicable laws), CIs and units of CI shall draw and send the report when incomes and expenses have not yet been transferred to determine business result, but after having processed balance of accounts “exchange rate difference”, “gold, silver and precious stone”, “difference due to revaluation of assets at the end of the fiscal year” according to current regime.

c. In case where CI is the parent company: Besides the preparation and sending of its Statement of accounts, the CI shall also have to enclose the Statement of accounts of its subsidiary companies upon request of the state management agency.

3. The sending of Statement of accounts (in both written and electronic form) to the State Bank shall be performed under the procedure of sending Financial Statement and Statement of Accounts as provided for in Article 10 of this Regime.

Article 10. Procedure of submitting Financial Statement and Statement of Accounts

1. Procedure of submitting Report in electronic file to the State Bank

a. Head Office of State owned CIs, Central People’s Credit Fund in the North (from Thua Thien Hue Province backward) must connect to the information transmission network with Banking Informatics Technology Department; the State owned CIs in the South (from Danang city onward) must connect to the information transmission network with Branch of Banking Informatics Technology in Hochiminh city for submitting report.

b. Head Office of CIs not being State owned CIs and foreign bank branches designated to be coordinating units must connect to the information transmission network with State Bank branches in provinces, cities under the central Government’s management (where their headquarter is located) for submitting report.

c. Operation Department, Branches, subsidiary units of CIs performing dependent accounting and foreign bank branches which are located in the provinces, cities under the central Government’s management must connect to computer network with the State Bank branches in provinces, cities (where their headquarter is located) for submitting report.

2. Procedure of submitting Report in written form to the State Bank

a. CIs (including State owned CIs, joint stock CIs, joint venture CIs, foreign bank branches in Vietnam, 100% foreign owned banks established and operating in Vietnam) shall submit their written Report to the State Bank of Vietnam (State Bank Inspectorate).

b. Central People’s Credit Fund shall submit its written Report to the State Bank of Vietnam (Cooperative CIs Department).

c. Operation Department, Branches and subsidiary units of CIs performing dependent accounting which are located in the provinces, cities under the central Government’s management must submit the written Statement of accounts to the State Bank branches in provinces, cities under the central Government’s management (where their headquarter is located).

3. The sending of audited annual Financial Statement and conclusion made by independent audit firm (audit report) to the State Bank of Vietnam (in both written and electronic form) shall be performed in accordance with the procedure of sending report as provided for in paragraph 1, 2 of this Article.

4. The sending of financial statement to financial agencies, tax agencies and statistics agencies shall be performed in writing in accordance with the guidance of those agencies or according to other current provisions of related laws.

5. Procedure of sending Financial Statement within the CI shall be provided for and guided by General Director (Director) of the CI.

Article 11. Responsibility of Credit Institution

1. General Director (Director) of the CI shall be responsible for organizing the preparation and presentation of the financial statement as well as responsible for the accuracy, fullness and honesty of the information stated in its financial statement.

2. CI, operation Department, branches, subsidiary units of the CI performing dependent accounting and foreign bank branches shall be responsible for:

a. Preparing and sending fully, timely the Financial Statement and the Statement of accounts in accordance with provisions of this Regime.

b. For Financial Statement and Statement of accounts in written form, they must be fully supported by signatures, seal of the unit in accordance with applicable provisions.

c. For Financial Statement and Statement of accounts in electronic file saved in information carrier or transmitted via computer network, they must be encrypted, kept secret and transmitted (sent) in line with current provisions of the State Bank on transmission, retrieval of information, report via internet or magnetic tapes, discs.

d. Upon receiving check note about the fact that the Financial Statement and Statement of accounts contain errors from the report receiving unit, CIs, units of CI must check, examine again and in case of having any error, they have to immediately correct by canceling the report with errors and draw a right report to resend to the report receiving unit enclosed with the response to the check note that “error already corrected”; Where CIs, units of CI detect by themselves that their report contains error, they have to actively correct and resend the right report to the report receiving unit enclosed with explanation of errors that need correcting.

Article 12. Responsibility of units of the State Bank

1. State Bank branches in provinces, cities under the central Government’s management

a. Being a coordinating unit to receive Financial Statements and Statements of accounts in electronic file in accordance with provisions in Article 10 of this Regime from Head Office of CIs not being state owned CIs and coordinating branch of foreign banks in the local area; examining the accuracy in terms of arithmetic of the reports; in case of detecting any error, they have to timely inform the report sending units for correction, resending and transmitting to Banking Informatics Technology Department.

b. Being a coordinating unit to receive Statements of accounts in accordance with provisions in Article 10 of this Regime both in written and electronic form through information transmission network of Operation Departments, branches, subsidiary units of CIs and foreign bank branches in the local area; examining the accuracy in terms of arithmetic of the reports; in case of detecting any error, they have to timely inform the report sending units for correction and resending. These reports are used for the purpose of exploitation and using in the local area, Branches do not need to transmit them to the Central.

c. Exploiting data and situation in Financial Statements, Statements of accounts for the implementation of assignments and authorities provided for by the State Bank’s Governor; Managing and preserving the reports in accordance with current provisions.

2. Banking Informatics Technology Department

a. Being a coordinating unit to organize the receipt of Financial Statements and Statements of accounts transmitted via information transmission network or information carriers by CIs or State Bank branches in provinces, cities under the central Government’s management; Organizing the archive of reports safely and confidentially.

b. Examining the accuracy in terms of arithmetic of the reports in file form; in case of detecting any error, they have to timely inform the report sending units for correction and resending and informing related functional Departments, units for knowledge, avoiding the use of erroneously reported data.

c. Consolidating norms on the reports upon the demand for exploitation and use of related functional Departments, units of the State Bank.

d. Providing guidance to CIs, State Bank branches in provinces, cities under the central Government’s management and related functional Departments, units of the State Bank on carrying out the transmission, receipt and exploitation of data reported via information transmission network or information carriers in accordance with applicable provisions.

dd. Ensuring the smooth, timely, accurate, safe and confidential transmission of information.

e. Organizing and carrying out the publication of audited annual Financial Statement in file form, received from CIs (including conclusion made by independent audit firm) on the website of the State Bank.

3. Finance - Accounting Department

Taking responsibility for guiding the implementation of this Regime.

4. State Bank Inspectorate

a. Being a coordinating unit to organize the receipt of written Financial Statements sent by CIs; organizing the archive of data of Financial Statements safely, confidentially and sharing information with functional departments according to functions and assignments.

b. Examining the accuracy in terms of arithmetic of written Financial Statements; in case of detecting any error, timely informing the report sending units for correction, resending and informing related functional Departments for knowledge, avoiding the use of erroneously reported data.

c. Coordinating with functional units to examine the compliance with this Regime by CIs.

5. Cooperative Credit Institutions Department

a. Being a coordinating unit to organize the receipt of written Financial Statements sent by Central People’s Credit Fund; organizing the archive of Financial Statements safely, confidentially and sharing information with functional departments according to functions and assignments.

b. Examining the accuracy in terms of arithmetic of written Financial Statements of Central People’s Credit Fund; in case of detecting any error, timely informing the report sending units for correction, resending and informing related functional Departments for knowledge, avoiding the use of erroneously reported data.

c. Coordinating with functional units to examine the compliance with this Regime by Central People’s Credit Fund.

6. Departments and related units of the State Bank

Based on functions, assignments provided for by the Governor of the State Bank, to register with Banking Informatics Technology Department, State Bank Inspectorate and Cooperative Credit Institutions Department to exploit CIs’ reports upon specific demand and take responsibility for managing, using and preserving information relating to the reports within their unit.

Article 13. Auditing Financial Statement

The auditing for financial statements of CIs shall be performed in accordance with provisions of current laws.

Article 14. Disclosure of Financial Statement

1. Subject and forms of report to be disclosed

a. All CIs (including State owned CIs, joint stock CIs, Central People’s Credit Fund, joint venture CIs, foreign bank branches in Vietnam, 100% foreign owned CIs established and operating in Vietnam) must disclose their audited annual financial statement enclosed with conclusion (audit report) made by independent audit firm.

b. State owned CIs and CIs listed in the securities market must disclose their mid-annual financial statement in full form in accordance with provisions of current laws.

CIs which voluntarily disclose their mid-annual financial statements shall be entitled to select form of mid-annual financial statement either in full form or in summary form for disclosure.

2. Form, content and time for disclosure of financial statement

a. Form of disclosure

CIs shall carry out the disclosure of their financial statement at their head office and locations of operation; publish in 3 consecutive issues of a central and local paper; on website or in form of issuing publications (annual report, etc…) of CI; give a written notice to state management agencies upon the requirement and press conference, etc…

b. Contents of disclosure

Contents of the disclosure of Financial Statement at the head office and locations of operation, on central and local paper shall include, at least, Statement of accounts and Profit/Loss Statement (or forms of unified financial statement corresponding with the CI being parent company) and conclusion made by an independent audit firm (Audit Report).

c. Time for disclosure

- Time for disclosure of annual financial statement shall be 120 day at the latest since the ending of the fiscal year of the CI.

- Time for disclosure of mid-annual financial statement shall be in accordance with current provisions of applicable laws.

3. CI shall be responsible for answering inquiries upon request of subjects using financial statement (state management agencies, shareholders, customers, etc…)

4. Cases which affect the disclosure of financial statement such as: delay of the disclosure of information, failure to disclose partially or wholly information on financial statement, etc… must be accepted by the Governor of the State Bank.

5. Within 10 working days, since the financial statement is disclosed according to the provisions in this Regime, CIs must send a confirmation/notice on their disclosure of financial statement to the State Bank (Banks Department and State Bank Inspectorate).

Article 15. Archive of Financial Statement and Statement of accounts

Financial Statement and Statement of accounts must be kept, preserved in accordance with the current Regime on archive of accounting documents.

Chapter II

SPECIFIC PROVISIONS

Section 1. FINANCIAL STATEMENT OF CI

Article 16. Subjects required to draw financial statement

All CIs (including State owned CIs, joint stock CIs, Central People’s Credit Fund, joint venture CIs, foreign bank branches in Vietnam, 100% foreign owned CIs established and operating in Vietnam) shall have to prepare and present the financial statement.

Article 17. System of financial statements for CIs

1. Financial statement of CIs is the one prepared on the basis of the data of the entire system of CI (excluding transactions performed within the CI system), including: Head Office, Operation Department, branches and subsidiary accounting units performing dependent accounting (if any) of CI.

2. System of financial statements for CIs includes:

- Balance sheet: Form No. B 02/TCTD

- Loss/Profit Statement: Form No. B 03/TCTD

- Cash Flow Statement: Form No. B 04/TCTD

- Notes to the Financial Statement: Form No. B 05/TCTD

Section 2. UNIFIED FINANCIAL STATEMENT

Article 18. Unified financial statement

1. Unified financial statement is the financial statement of a CI group, presented like the financial statement of a CI. This statement is prepared on the basis of unifying reports of the parent company and of subsidiary companies in accordance with provisions in Vietnamese Accounting Standard (VAS) No. 25 - Unified Financial Statement and accounting of investments in subsidiary company.

2. System of unified financial statements for CIs includes:

- Unified Balance Sheet: Form No. B 02/TCTD-HN

- Unified Loss/Profit Statement: Form No. B 03/TCTD-HN

- Unified Cash Flow Statement: Form No. B 04/TCTD- HN

- Notes to Unified Financial Statement: Form No. B 05/TCTD- HN

Article 19. Subjects required to prepare unified financial statement

1. All CIs which have either one or several subsidiary companies shall have to prepare the unified financial statement, except for the cases provided for in paragraph 05 of Vietnamese Accounting Standard No. 25.

2. CIs being parent companies must unify the financial statements of all of their subsidiary companies inside and outside the country when preparing the unified financial statement, except for cases which are exempted from the unification in accordance with provisions in paragraph 10 of Vietnamese Accounting Standard No. 25.

Article 20. Principles of the preparation of unified financial statement

1. Unified financial statement must comply with the principles provided for in Article 3 of this Regime.

2. Besides the principles provided for in paragraph 1 of this Article, the preparation of unified Financial Statement should comply with following principles:

a. Financial statements of accounting units in the same group used for unifying financial statements must be prepared for the same accounting period. Where the closing days of an accounting period are different, subsidiary companies shall have to prepare one more financial statement for the unifying purpose with the accounting period of the group. In any case, the difference in the closing day of an accounting period shall not be permitted to exceed 3 months.

b. Unified Financial Statement must be prepared on the basis of an accounting policy applied commonly in the same group. Where there is any difference in the application of the accounting policy, CIs should make explanation in accordance with provisions in paragraph 2, Article 22 of this Regime.

Article 21. Sequence of unifying financial statements

1. Upon unifying financial statements, financial statements of Parent Company and its subsidiary companies shall be unified under each item by adding respective items of assets, payable debts, owner capital, revenues/incomes and expenses. At the same time, in order to help the unified financial statement fully supply financial information about the whole group as for an independent enterprise, CI should perform as follows:

a. Book entry value of the investment by the parent company in each subsidiary company and the capital amount of the parent company contributed in the owner capital of the subsidiary company shall be excluded.

b. Balance of accounts on the Balance Sheet among units in the same group, internal transactions, internal incomes/expenses, cash flows arisen from these transactions shall be excluded absolutely.

c. Benefits of minor shareholders relating to net income of the subsidiary companies which are unified in the accounting period, determined and excluded from income of the group for calculating net profit or loss may be determined for owning subjects of the parent company.

d. Benefits of minor shareholders relating to net assets of the subsidiary companies shall be unified, determined and stated on the unified Balance Sheet as a separate norm, independent of payable debts and owner capital source of the parent company’s shareholders.

2. Investments in allied company, joint venture company (co-controlled joint venture unit) shall, upon preparing unified financial statement, be accounted according to the method of owner capital provided for in Vietnamese Accounting Standards No. 07 - Accounting for investments in allied company and No. 08 - Information about joint venture capital contributions. Whereby, the initially contributed capital amount shall be acknowledged and reflected on the financial statement under the original price, and then it shall be adjusted on the unified financial statement according to the changes in the ownership of capital contributing party in the entire of net assets of the allied company, Joint Venture Company.

Article 22. Requirement for additional notes to the unified Financial Statement

Upon preparing unified financial statement, CIs should perform the additional explanation for following information in the notes to financial statement:

1. CIs which are parent companies, but do not have to prepare unified financial statement in accordance with provisions in paragraph 1, Article 19 of this Regime should clearly state name and address of the head office of the parent company which prepared and issued the unified financial statement on their report.

2. When the accounting policy between the parent company and subsidiary companies is not consistent, the parent company should explain this matter together with the items accounted under different accounting policies in the unified financial statement.

3. List of important subsidiary companies includes: name of the company, location, owning ratio of the parent company (where the owning ratio is different from the voting ratio or benefit ratio, all these ratios should be explained).

4. The reason for not unifying financial statements of subsidiary companies (cases of exclusion shall be performed according to paragraph 2, Article 19 of this Regime) and cases where the parent company holds more than 50% of voting right, but does not have control right to set up a subsidiary company.

5. Effect of the purchase and sale of subsidiary companies to financial status of the CI group by the day of preparing report, result of the reporting period and effect to respective data of previous period.

Section 3. CONSOLIDATED FINANCIAL STATEMENT OF CI

Article 23. Subjects required to prepare consolidated financial statement

CIs being coordinating accounting unit or designated as representative of a type/group of CIs operating and performing independent accounting shall have to prepare a consolidated financial statement to reflect consolidated economic - financial information of all member units in the same type/group.

Article 24. System of consolidated financial statements and preparation method

1. System of consolidated financial statements is similar to forms of financial statements as provided for in Section 1, Chapter II of this Regime.

2. Consolidated financial statement is prepared by consolidating financial statements or directly drawing from consolidated statement of accounts of accounting units in the same type/group.

Section 4. MID-ANNUAL FINANCIAL STATEMENT OF CI

Article 25. Mid annual financial statement

1. Mid annual financial statement is the one including full financial reports (mid-annual full financial statement) or summary financial report (mid-annual summary financial statement) prepared for a mid-annual accounting period.

2. Provisions on mid-annual financial statement in this Regime shall be also applicable to CIs which draw and disclose unified/consolidated financial statement (mid-annual unified/consolidated financial statement)

Article 26. Subjects required to prepare mid annual financial statement

1. All CIs must prepare mid annual financial statements in full form and submit to related state agencies in accordance with provisions in Article 5, 6, 7, 8, 9 of this Regime.

2. CIs which are not required to disclose mid-annual financial statement shall be entitled to select form of mid-annual financial statement either in full form or summary form to serve the disclosure of mid annual financial statement in accordance with provisions in Article 14 of this Regime.

Article 27. Forms and contents of mid annual financial statements

1. Mid annual financial statements in full form include:

- Balance sheet in full form: Form No. B02a/TCTD

- Profit/loss statement in full form: Form No. B03a/TCTD

- Cash flow statement in full form: Form No. B04a/TCTD

- Selective Notes to the financial statement: Form No. B05a/TCTD

2. Mid annual financial statements in summary form include:

- Balance sheet in summary form: Form No. B02b/TCTD

- Profit/loss statement in summary form: Form No. B03b/TCTD

- Cash flow statement in summary form: Form No. B04b/TCTD

- Selective Notes to the financial statement: Form No. B05a/TCTD

Article 28. Requirement for additional notes to mid annual financial statement

CI should additionally state following contents in the notes to selective financial statement:

1. Announcement on the compliance with the preparation and presentation of mid-annual financial statement according to Vietnamese Accounting Standard No. 27 - Mid-annual financial statement as well as other accounting standards and current accounting regime.

2. Announcement on the consistent application of accounting policy to the period of preparation of annual financial statement and mid-annual financial statement. In case of any change, CI should state those changes and state their effect to the financial statements (if any).

3. Essential events arising after the mid annual accounting period ends which have not yet been reflected in that mid annual financial statement.

Chapter III.

IMPLEMENTING PROVISIONS

Article 29. Extension of partial effectiveness

1. Mid annual unified financial statements of CIs provided for in Section 4 - Mid annual financial statement, Chapter II of this Regime shall be implemented from 2008.

2. Provisions in point 47.1 - Interest rate risk and point 47.3 - Liquidity risk of Section IX- Management of financial risk of Notes to financial statement (Form B05/TCTD) shall be implemented from 2008.

3. From Quarter I/2009, CIs shall prepare Cash Flow Statement under the online method.

Article 30. Dealing with violation

Acts of violating provisions in this Regime shall be, depending on the seriousness of violation, dealt with in accordance with provisions of current laws.