In the context of global economic integration, IFRS (International Financial Reporting Standards) is gradually becoming a mandatory rule in Vietnam, especially for FDI (Foreign Direct Investment) enterprises. According to the official roadmap, IFRS will be the new “game rule” for preparing and presenting financial statements from 2025 onwards.
Understanding and preparing for this change early is not just about legal compliance—it’s also a competitive advantage.
The Ministry of Finance has announced a clear three-phase roadmap for adopting IFRS:
2020 – 2021: The Preparation Phase. During this period, the Ministry of Finance focused on translating IFRS standards, conducting training, and developing implementation guidelines.
2022 – 2025: The Pilot Phase. Eligible companies, such as listed companies and large state-owned enterprises, were encouraged to voluntarily adopt IFRS for their consolidated financial statements. FDI enterprises could also voluntarily apply IFRS for their separate financial statements during this phase.
Post-2025: The Mandatory Phase. From 2025 onwards, IFRS will become a mandatory requirement for the consolidated financial statements of all state-owned enterprises, listed companies, and large unlisted public companies. Other enterprises, including FDI enterprises, are encouraged to adopt it voluntarily to ensure transparency and consistency.
The transition to IFRS is not just a compliance task but also brings several strategic benefits:
Global data synchronization: Eliminating differences between VAS (Vietnam Accounting Standards) and IFRS makes it easier and more accurate to consolidate reports with parent companies.
Cost and time savings: Reduces duplication and data discrepancies during the data conversion process.
Enhanced credibility: Increases transparency, building trust with tax authorities and investors in Vietnam.
Capital-raising opportunities: IFRS is a prerequisite for accessing international investment funds and global capital markets.
The period after 2025 is approaching. To ensure a smooth transition, FDI enterprises should proactively take the following steps:
Conduct a gap analysis: Review and compare the differences between VAS and IFRS to identify necessary changes in accounting procedures.
Train local teams: Invest in training finance and accounting staff in Vietnam to ensure they can competently understand and apply international standards.
Upgrade systems: Prepare and upgrade accounting software systems to be capable of generating IFRS reports alongside VAS reports.
Run pilot projects: Begin piloting IFRS for internal or separate financial statements to get familiar with the changes before the mandatory implementation.
Proactively preparing for IFRS now will help FDI enterprises in Vietnam not only comply with the new regulations but also improve operational efficiency and ensure sustainable growth.
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