International Financial Reporting Standards effects on Banks in Vietnam
Pham, Trang (2012)
Pham, Trang
Jyväskylän ammattikorkeakoulu
2012
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2012102314587
https://urn.fi/URN:NBN:fi:amk-2012102314587
Tiivistelmä
The thesis discusses the Impact of International Financial Reporting Standards (IFRS) on Banks operating in Viet Nam. The goal is to investigate how the adoption of IFRS would change financial practices in Vietnamese Banking Industry and what Bank managers should be prepared for. The thesis use case study method to gain in-depth knowledge about the issue. The case study consisted analysis of Financial Reports from three well-known Banks in Viet Nam.
The thesis first introduce about Banking history in Viet Nam then the current status of Banking Industry. After that, the study continue to look into differences in Financial Reports between a typical company and a Bank before analyzing the differences between Vietnamese Accounting Standards (VAS) and IFRS. Furthermore, the thesis includes an important section, discussing the effects of IFRS in Bank’s accounting practice in Viet Nam if it is to be implemented. These effects derived from differences between VAS and IAS because changes in Accounting and Operation of Banks would need to be made in order to meet the requirements of IFRS, which are, in general, stricter than those of VAS. Last but not least is the case study of three major Banks in Viet Nam: EXIM Bank, Vietin Bank and ACB. Each bank represent a certain type of Banks in Viet Nam, ranging from state-owned, industrial oriented bank to commercial bank whose portfolio centers in daily household financial services. How each bank implemented IFRS in their financial reports is carefully studied to gain an insight about reality of IFRS implementation in Viet Nam in Banking industry.
From the over view, it can be seen that IFRS has not been made mandatory in Viet Nam, hence it remains optional for Banks to decide whether to follow some or any of the standards when preparing their financial reports. However, the pressure for applying IFRS is increasing, owning to highly competitive environment in the industry and the growing demands for transparency from shareholders. The research has found that banks have begun to include few part of IFRS in the annual reports , though not required in VAS, for example: exchange rate policies, risk management, disclosure to related party, employee benefit and so on. However, this is still far from a complete IFRS implementation and for all cases, all the IAS regulation practiced is only on surface, lacking details information.
The thesis first introduce about Banking history in Viet Nam then the current status of Banking Industry. After that, the study continue to look into differences in Financial Reports between a typical company and a Bank before analyzing the differences between Vietnamese Accounting Standards (VAS) and IFRS. Furthermore, the thesis includes an important section, discussing the effects of IFRS in Bank’s accounting practice in Viet Nam if it is to be implemented. These effects derived from differences between VAS and IAS because changes in Accounting and Operation of Banks would need to be made in order to meet the requirements of IFRS, which are, in general, stricter than those of VAS. Last but not least is the case study of three major Banks in Viet Nam: EXIM Bank, Vietin Bank and ACB. Each bank represent a certain type of Banks in Viet Nam, ranging from state-owned, industrial oriented bank to commercial bank whose portfolio centers in daily household financial services. How each bank implemented IFRS in their financial reports is carefully studied to gain an insight about reality of IFRS implementation in Viet Nam in Banking industry.
From the over view, it can be seen that IFRS has not been made mandatory in Viet Nam, hence it remains optional for Banks to decide whether to follow some or any of the standards when preparing their financial reports. However, the pressure for applying IFRS is increasing, owning to highly competitive environment in the industry and the growing demands for transparency from shareholders. The research has found that banks have begun to include few part of IFRS in the annual reports , though not required in VAS, for example: exchange rate policies, risk management, disclosure to related party, employee benefit and so on. However, this is still far from a complete IFRS implementation and for all cases, all the IAS regulation practiced is only on surface, lacking details information.