WB, Vietnam work to strengthen financial systems

Titled “Reports on the Observance of Standards and Codes (ROSC): Accounting and Auditing module”, the report is part of a global initiative to improve compliance with internationally recognized standards and codes, focuses on accounting and auditing standards and practices for public interest entities, as well as the institutional framework that underpins the corporate financial reporting system.

As part of the WB’s support for Vietnam’s Vision 2030 on Accounting and Auditing, the Bank hoped to contribute to the successful implementation of the country’s long-term strategy for sustainable and inclusive development.

Linked to complementary reforms in the financial sector, the report recommends that Vietnam’s Accounting Law and the Law on Independent Audit could benefit from simplification during the next revision process. It also advises that the nation fully adopts International Financial Reporting Standards (IFRS) and related guidance from the International Financial Reporting Interpretations Committee for public interest entities.

“We echo the report’s point of view that the IFRS adoption is undeniable. Once IFRS is adopted, the quality of corporate financial reporting will improve significantly through enhanced accountability, transparency and comparability, providing users with useful information for management, governance and investment decision making. In addition, the adoption also promotes the international recognition of Vietnam's full market economy status, and eventually the FDI flow”, stressed Ms Vu Thi Mai, MoF Vice Minister.

The Ministry is promptly working on the development of a proposal on updating Vietnam Corporate Standards for submission to the Government’s approval for IFRS adoption.

The report also recommends specific policy measures relating to statutory frameworks, accounting standards, public oversight and monitoring, accounting education, and public accountancy organizations, in order to promote transparency and investor confidence, mitigate risks stemming from financial volatility, and foster market efficiency as well as private sector led economic growth./.