CIRCULAR Guide made sixteen (16) accounting standards promulgated by decision 149/2001/QD-BTC, the decision 165/2002/QD-BTC dated 31/12/2002 and decision 234/2003/QD-BTC dated December 30, 2003 by the Minister of finance _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ the base accounting Law No. 03/2003/QH11 on 17/6/2003;
Pursuant to Decree No. 77/2003/ND-CP dated 1/7/2003 of government regulations on functions, tasks, powers and organizational structure of the Ministry of finance;
The Ministry of Finance shall guide the implementation of sixteen (16) accounting standards issued together with decision No. 149/2001/QD-BTC dated December 31, 2001, decision No. 165/2002/QD-BTC dated 31/12/2002, decision No. 234/2003/QD-BTC dated December 30, 2003 by the Minister of finance, as follows: i. GENERAL PROVISIONS 1. This circular applies to businesses in the industry, the economic sectors in the country.
2. This circular guides implementation of the accounting standards including: accounting standards no. 2 "inventories", accounting standards no. 03 "tangible fixed assets" accounting standards no. 04 "intangible fixed assets" accounting standards no. 5 "investment property", accounting standards no. 6 "asset Rental" Accounting standards no. 07, "accounting of investments in associated companies", accounting standards no. 8 "financial information about the venture capital account" number 10 accounting standards, "the influence of the change of the exchange rate," the number 14 "accounting standards sales and other income" , Accounting standards no. 15 "construction contracts", accounting standards no. 16 "borrowers", cost accounting standards no. 21 "presentation of financial statements", accounting standards no. 24 "cash flow statements" accounting standards no. 25 "consolidated financial statements and accounting investments in subsidiaries" Accounting standards no. 26, "information about the parties involved".
II. IMPLEMENTATION GUIDE ACCOUNTING STANDARDS NO. 2 "INVENTORIES", ACCOUNTING STANDARDS No. 03 "TANGIBLE FIXED ASSETS" ACCOUNTING STANDARDS No. 04 "INTANGIBLE FIXED ASSETS" content inventory accounting, Accountant General fixed manufacturing costs, accounting loss, shrinkage and inventory accounting inventory discount backup is done according to the design mode business issued under the decision No. 15/2006/QD-BTC dated 20/3/2006 (hereinafter referred to as the accounting mode current business) of the Minister of Finance (see instructions of the accounts in the group 15-inventory).
The content reflects the accounting method and tangible, intangible LOAN LOAN made under business accounting mode (see instructions TK 211, 213).
III. IMPLEMENTATION GUIDE ACCOUNTING STANDARDS NO. 5 "INVESTMENT PROPERTY" 1. Investment property and recorded cases: 1.1. Investment property: property (REAL ESTATE) investment is real estate, including: land use; Home, or a part of your home, or both the House and the land; The infrastructure caused by the owner or the person who rented the property lease finance aims to profit from the lease or wait for price increases that are not to:-use in production, to provide goods or services or used for management purposes; or:-Sold in normal business operations.
1.2. The cases are recorded as investment property:-land use (due to business buyers back) hold in the long run to wait for price increases;
-Land use (due to business buyers) holds that not clearly identify the purpose of use in the future;
-Home ownership by enterprises (or due to financial lease business) and rent under one or more of the lease active;
-The House is being kept to for rent by one or more of the lease active;
-The infrastructure is being kept to for rent by one or more active lease.
1.3. The special cases are recorded as investment property-the property which a business part holding aims to profit from the lease operation or wait for price increases and in part used for the production, supply of goods, services or to manage then if the assets to be sold separately (or leased separately under one or many active rental contract), the business will use assets accounting to rent or wait for the price increase is the real estate investment and property management and production are accounting is tangible or intangible LOAN LOAN.
The case of real property not sold separately and used for trading or for management is negligible (below 20%), then accounting is investment property. For example: the business has a building on 80% of the area of operation and hire professional under 20% of the area used as the Office building of the company which are accounting for investment property.
-The business case to provide related services to people who use property owned by enterprises is a relatively small part of the entire agreement, then the business will account for this property is investment property. For example, the business owned the building for other units in the Office rental (rental operation) at the same time providing maintenance and security services for this rental building.
-Cases, a subsidiary to the parent company or other subsidiaries of the same Corporation or rental use and holding a property, then that property is real estate accounting is investing on the financial statements of the company's own property or separate financial statements of the parent if the parent company to subsidiaries (rental If it meets the definition of investment property), but not reflected as investment property in consolidated financial statements.
2. Accounting for investment property reflects the content and the method of accounting of real estate investment according to the mode of business accounting (see instructions TK TK 2147, 217, TK TK TK 5117, 1567, 632).
IV. IMPLEMENTATION GUIDE ACCOUNTING STANDARDS NO. 6 "ASSET RENTAL" 1. Property rental classification 1.1. Property rental classification is based on the nature of the terms of the contract and are made right at the beginning of rental property. After the initial lease time if there are changes to the terms of the contract (except contract) then the new terms are applied for throughout the duration of the contract. But the change in estimates (changes estimate time used or remaining value economic property's rent) or change the payment ability of the lessees shall not alter the classification of property for rental with the record ledger.
1.2. property rental classification be based on the extent of the transfer of the risks and benefits associated with ownership of the rental property from the lessor to the lessees. Property rental includes financial and operating lease rental.
1.2.1. financial Rental: a) financial: Rental property rental Is that the rental party delivered the majority of the risks and benefits associated with ownership of the asset to the party. Property ownership can be transferred at the end of the rental period.
b) The following property hire cases often leads to financial lease:-lessor transfers ownership of property for lease when lease expiry.
-At the time of the start property rental, lease option to buy back your property rent with prices lower estimate reasonable value at the end of the rental period.
-Minimum property rental period must constitute a major part of the economic use of property whether without the transfer of ownership.
-At the beginning of rental property, the present value of the minimum lease payments constitute the greater part (the equivalent of) reasonable value of the property.
-Rental property in the specialized type that only party capable of using without change, major repair.
c) lease assets are also considered financial rental contract if the contract to satisfy at least one of the three (3) cases: – If the party cancelling the contract hire and compensate losses associated with the cancellation of the contract for the rental party;
-Income or loss due to the change in value of the remaining value of the leased assets tied lessees;
-Rent Party capable of continuing to rent back the property after the expiration of the lease rent is lower than the market rental rates.
1.2.2. activity: Rental-rent properties are classified as operating lease if the contents of the property rental contract without the transfer of the majority of the risks and benefits associated with ownership of the property.
-Property Rental is the right to use the land are usually classified as operating lease for land use often have time to use the economy and will not transfer ownership to lessees upon expiry of the lease.
2. Accounting Guide property rental is 2.1 financial rental-leasing assets recorded for lessees 2.1.1. At the time of receipt of the rental property, rent parties noted the value of assets and liabilities of the original financial lease are charged on financial lease with the same value equal to the reasonable value of the property. If the value of the property rent is higher than the current value of the minimum lease payments shall record according to the current value of the minimum lease payments.
When calculating the present value of the minimum lease payments for leased property, businesses can use the default rate of interest or the rate of interest to be included in the lease or marginal interest rate borrowers of lessees.
In the case of financial lease clearly original debt is charged by the reasonable value of the property then rental property rent and payable on financial lease are recorded according to the same value.
The reasonable value or the present value of the minimum lease payments are recorded as financial lease LOAN value price VAT (including the leasing LOAN case refers to the activities of goods or services subject to VAT liable according to tax deduction method and case of financial lease LOAN user into the activities of goods in service, the object is not subject to VAT or liable to VAT by direct method).
2.1.2. The direct costs arising originally related to the financial lease activity is calculated on the price of the rental property resource.
2.1.3. leasing payments financial rental property must be divided into financial expenses (interest financial hire) and the original debt repayments each month. Finance lease interest rate amount must be paid on the cost accounting of finance throughout the duration of the lease. Finance lease interest recorded on the financial cost of each period is determined by the original balance left (x) with periodic interest rate is fixed.
The case of VAT by the lessor has to pay when buying a LOAN to rent which lessees have to refund the amount of the interest on financial lease are charged based on the amount of interest including VAT number that unpaid rent party for the lessor.
2.1.4. the party responsible for computer rental, fixed assets depreciation on the cost of production, business periodically on the basis of depreciation policy consistent with the depreciation policy of the same type of assets owned by the business goes to rent.
Not sure if is the party will have the right to own property when the lease expires, the lease rental property will be depreciated under the lease if the lease is shorter than the time use of the rental property.
2.1.5. where the interest on financial lease eligible capital property values into the unfinished implementation as defined in section accounting standards no. 16-cost borrowers.
2.2. LOAN accounting financial lease: content reflects the accounting methods and financial lease LOAN made under the provisions of the enterprise accounting mode current.
3. rental property accounting guide is active rental 3.1. Noted the active rental properties is rented for business is property Rental lease rental operation, the enterprise does not reflect the rental value of your property go on the rental Balance Sheet of enterprises, but only reflects the cost of operating rental money on production costs, the business according to the straight line method for property rental period , does not depend on the method of payment of rent (paid each rental period or prepaid, postpaid).
3.2. active rental LOAN accounting: content reflects the accounting method and active rental LOAN made under the provisions of the enterprise accounting mode current.
4. Accounting transaction sale and rent back LOAN is to finance rental 4.1. Transaction record property sale and rent back is a financial lease transaction to sell and rent back your property to be performed when the property is sold and leased back by the seller. The difference between the income of selling the property with the value left on the accounting books are not recognised as an interest or losses from the sale of assets that are recorded as income not yet done or long-term prepayments and allocation for the duration of the rental property. In sale and rent back deals, if any costs incurred beyond the cost of depreciation shall be accounted into the costs of production, business in the States.
4.2. Accounting transaction sale and rent back property is leasing: follow business accounting mode (see section TK guide 212).
5. Accounting transaction sale and rent back LOAN is active rental 5.1. Noting the sale and rent back LOAN transaction is active rental 5.1.1. If the purchase price was agreed at a reasonable value, then the losses or the interest rate must be recorded immediately on the reported results of operations in the period incurred;
5.1.2. If the sale price is lower than the agreement reasonable value, the interest or the hole must also be recognised in the period incurred, except where losses are offset by future lease payments at a price lower than the market rental price rental, then the losses are not recognised that the gradual allocation consistent with rent payments during where the assets that are expected to use;
5.1.3. If the sale price is higher than the reasonable value, the difference is higher than reasonable values are not recognised as an interest in States that are allocated progressively throughout the time that the assets that are expected to use;
5.1.4. for operational lease, if reasonable value at the time of sale and rent back your property value is lower than the rest of the property, the amount of losses the difference between the remaining value and reasonable value must be recorded immediately in the period incurred.
5.2. Accounting transaction sale and rent back LOAN is hiring activities 5.2.1. When the sell and rent back LOAN, based on the invoice VALUE ADDED and the documentation related to the LOAN sale, sale transaction reflected accounting under the following circumstances: a) If the selling price to be agreed at a reasonable value, then the losses or the interest rate must be recorded immediately in the period incurred , based on invoices:-reflect the number of sale income LOAN, the Debt record: 111, 112, 131, FL. ...
There are 711-other income of TK (sale price LOAN) Are TK 3331-tax (If any).
At the same time, reduce the LOAN: debt-811 other cost of TK (the remaining value of the LOAN sale and rent back) Debt TK 214-depreciation LOAN (number has to wear-if available) there are TK tangible LOAN-211 (original LOAN).
b) If the selling price is low than the agreement reasonable value, the interest or the hole must also be recognised, the logging of accounting journal entry as in point 5.2.1 (a).
Case price sale and rent back LOAN is lower than the reasonable value but a lower rental price reviews the market rental losses are not recognised that the gradual allocation consistent with rent payments during the period of the property:-based on VALUE ADDED invoices and documents related to the sale of LOAN sale income LOAN, reflect, write: debt the TK 111, 112, ...
There are 711-other income of TK (sale price LOAN) Are TK 3331-tax.
At the same time, reduced LOAN records: 811-other costs TK Debt (calculated by the price of the LOAN) Arrears TK 242-long-term prepaid expenses (the difference in the value of the remaining LOAN is greater than the purchase price) of the debt-depreciation LOAN Had 214 TK TK 211-LOAN.
-In the next allocation of losses on sale and rent back transaction is active on the rental property, the cost of producing, trading in line with lease payments during the time that the property is expected to use, write: debt the TK 641, 642, 623, 627 Have TK 242-long-term prepaid expenses.
c) If the selling price and rent back your property the higher reasonable value, the difference is higher than reasonable values are not recognised as an interest in States that are allocated progressively throughout the time that the assets that are expected to use and the disparity between the values and the remaining values are recorded immediately in the interest rates is a period.
-Based on the Bill of sale LOAN RATES, Debt record: 111, 112, 131 the TK TK 711-other income There (in the reasonable value of the LOAN) Are TK 3387-sales not yet implemented (sale price disparity is higher than reasonable value of the LOAN) Are TK 3331-tax (If any).
At the same time, reduce the LOAN value to sale and rent back: 811-other costs TK Debt (the value of remaining LOAN sale and rent back) Debt TK 214-depreciation LOAN (If any) Are TK 211-LOAN.
-Periodically, allocate the amount of interest on transaction sale and rent back rental property is write operations reduce the production costs, the business in accordance with rent payments during the time that the property is expected to use, write: 3387-revenue debt-TK has not made Available the TK 623 , 627, 641, 642.
5.2.2. Periodically, determine the LOAN to pay rent, the Debt record: 623, 627, 641 of TK, TK 133 Debt 642-VAT deductible (if any) Have the TK 111, 112, 331.
V. IMPLEMENTATION GUIDE ACCOUNTING STANDARD NO. 7 "accounting of INVESTMENTS in ASSOCIATED COMPANIES" 1. General provisions 1.1. Investors are considered to have significant influence on the investor holds direct from 20% to below 50% of the voting rights of investing without the other agreement shall be considered to have significant influence on the investment side.
The case of investors holding less than 20% of the voting rights of investment but there agreement between the investment side and investors on the investment House that has significant influence or case of investors holding over 50% of the voting rights of the investment side but there is agreement on the investor that does not hold the control for the first recipient investment accounting is that investment is the investment in associated companies.
1.2. accounting methods the investment in associated companies-original price: method + investors originally recorded on investments in associated companies under the original price.
+ After the investment, investors noted the dividend, profit is split from the company's after tax profits linked to the turnover of the financial activity under the principle of automatic defragmentation (not including the account of dividends, profits of accounting period before the investment is purchased).
+ Other items from affiliated companies that investors receive in addition to dividends and profits to be divided is considered part of the investment account and credited to the original discount investments. For example, dividends of profits clause accounting period before the investment is purchased that investors get to keep the original discount investments.
+ Original price methods are applied in accounting terms investment in associated companies when establishing and presenting the financial statements of private investors.
-Equity method: + investments in affiliated companies are recorded initially as the original price.
+ Then, at the end of each accounting period, when the establishment and presentation of the consolidated financial statements, the logging value of investments is adjusted to increase or decrease respectively with the investor's ownership interest in the company's losses or following links on investment.
+ Dividends, profits are split from associated companies recorded log value reduction of investments in associated companies on the consolidated financial statements.
+ Logging values of investments in associated companies also must be adjusted when the interests of investors changes due to the change in equity of associated companies but are not reflected on the reported results of operations of the company. For example changes in equity of associated companies can include the account arising from the revaluation of investments and LOAN, the difference in the exchange rate of foreign currencies, and the adjustment of the difference arises when business (when buying investments).
+ The equity method is applied in accounting terms investment in associated companies when establishing and presenting the consolidated financial statements of the investor.
1.3. Pursuant to the accounting logging, set up and presentation of the financial report 1.3.1 investments. Pursuant to the accounting logging, and establishment of the presented financial statements investor's own was made according to the mode of business accounting.
1.3.2. Pursuant to the accounting logging, and establishment of the present consolidated financial statements of the investor a) for direct investments in associated companies, investors based on the financial statements of the company and the relevant documents when buying investments.
b) for indirect investments in affiliated companies through its subsidiaries, the investor based on the financial statements of the subsidiaries and the information document for the merge, the company's financial statements and related documents when companies buy the investment in associated companies.
c) In either case (direct investments in affiliated companies and investments in associated companies indirectly through subsidiaries), the end of each accounting period, the investor based on the reported results of operations of the company to identify and acknowledge the interest section (or holes) in the company link on the consolidated financial statements. At the same time based on the balance Sheet of the company the link to determine and adjust to increase or decrease the value of logging investments corresponds with his own part in the change in equity of associated companies but are not reflected in the reported results of operations of the company.
d) case when buying investments, if the difference between the purchase price and investment value of net asset book record can identify the corresponding part of the investor at the time of purchase, accountants have to determine this difference into the following parts:-the difference between the value and the value of net asset book record can be determined is the company affiliated with the respective property of the investor at the time of purchase, as part of this difference must be defined for each of the indicators, such as the difference between the value logical values and logging of the LOAN, of inventory, ...-the difference between the purchase price and the investments of investors of the value of the property NET can identify (if any), are called commercial advantage (if purchase price greater than the investments of investors of the value of net assets can be determined) or the difference between owning part of investors in the value of net assets can be determined to be greater than the purchase price of the investment.
Investors do not have to reflect the difference between the purchase price and investment value of net asset book record can be determined to be the company's link with the investor's property at the time of purchase on the accounts and the accounting for financial reporting of private investors that just open the accounting details to track and calculate the difference (if any) are allocated periodically served for the preparation of consolidated financial statements (if the investor to establish consolidated financial statements). As details of the difference lies in the accounting system serves for the preparation of consolidated financial statements.
2. Specific provisions 2.1. Accounting investments in associated companies when establishing and presenting the financial statements of the investor's own was made according to the mode of business accounting.
2.2. In accounting terms investment in associated companies when establishing and presenting the consolidated financial statements of the investor (except the cases specified in paragraphs 9 and 11 of the standard number of 12 "accounting of investments in associated companies").
2.2.1. General guidelines 22.214.171.124. In the consolidated financial statements of the investor, the investment in the associated company accounting must be according to the equity method, except for the cases specified in paragraphs 9 and 11 of the standard number of 12 "accounting of investments in associated companies".
126.96.36.199. End of the accounting period, when the establishment and presentation of the consolidated financial statements of the investor, the value of the item "investments in associated companies, joint ventures" in the consolidated balance Sheet to be adjusted as follows: a) tuning parts or holes in the interest of companies linked from after the date of investment and the other adjustment accounts recorded on balance sheet accounting case for from the previous accounting period.
-Before adjusting the portion of interest or loss in the period of investments in associated companies and other regulators, investors must adjust the interest section or the hole in part of its ownership in the company linked from after the date of investment and other regulators have noted and reflected in the consolidated accounting balance sheet accounting period ago adjacent to record and reflect on the item "investments in associated companies, joint ventures", the item "profit after tax not yet distributed" and other related items in the consolidated accounting balance sheet reports.
-The grounds for determining the interest portion or hole in the affiliated companies from the following on the investment to the end of accounting period before and the other adjustment accounts is accounting balance sheets of private investors and accounting balance sheets consolidated accounting period before the adjacent, the detailed accounting serves the combined financial statements.
b) adjust the interest portion or hole in the reporting period of investments in associated companies.
-The investor must determine and adjust to increase or decrease the value of investments in associated companies corresponding to the part owned by investors in the interest rate or the hole after CIT affiliated company at the end of each accounting period when the establishment and presentation of the consolidated financial statements. Affiliate company is a joint stock company has preferred stock dividends held by outside shareholders, the investor must exclude the preferential dividends section before determining his ownership portion of interest or losses from affiliates, including when no official announcement on the dividend paid in the period.
-Case losses in associated companies that investors bear the brunt greater than the value of the investment account, logging on the consolidated financial statements, the notes only investors lose value on investments in associated companies in the consolidated financial statements until it otherwise (= 0). Case the investor is obliged to pay instead of the affiliate company of debt that investors have guarantee or commitment to pay then the greater disparity of losses in associated companies and logging values of investments are recorded as expenses are charged. If the company then associated works with interest, investors noted his ownership portion of interest that after the offset is part of net losses have not been accounted before. The equity method is applied in the accounting of investments in associated companies when establishing and presenting the consolidated financial statements of the investor.
c) adjust the difference arises when buying investments in associated companies: When buying investments in associated companies, if the difference between the purchase price of the investment and the investor's property according to the reasonable value of the net assets can be determined by the company at the time the links to purchase investments investors must determine that difference into parts as stated in point d item 1.3.2 above. At the same time the end of accounting period when consolidated financial reporting, when determining the portion of interest or losses of investments in associated companies, investors must make appropriate adjustments:-difference between the allocation of investments in the value and the value of net asset book record can be identified by their affiliated companies use of LOAN interest rate section useful or loss in associated companies;
-Allocated account commercial advantage (purchase price greater than the investments of investors of the value of net assets can be determined), must not exceed 10 years in the interest rates or the hole in the associated companies.
Purchase price-the case of the smaller investments owned part of investors in the value of net assets can be determined at the time of purchase of investments, investors should review the determination of the reasonable value of the net assets can be determined and the determination of the purchase price of the investment. If, after review, adjust that still disparities are all the difference remains after revaluation is adjusted right to the interest rate or the hole in the link when the company consolidated financial reporting.
d) adjust the account of dividends, profits are divided into: Account of dividends, profits are split from associated companies in the period to record the logging value reduction on investments in associated companies and the interest or losses from affiliate companies.
DD) adjust the account changes in equity of associated companies: the case of the equity of associated companies has changed (but not reflected through reporting the results of operations in the period, such as the revaluation difference of assets, the difference in rates is not recorded as interest rates , hole in the States), based on the accounting Balance Sheet of the company the link to determine and record the part owned by investors in the value change in equity of associated companies. This account was recorded an increase (decrease) the value of investments in affiliated companies and the corresponding items of the equity investor.
188.8.131.52. the interest rate or the hole in the States owned by investors in your affiliate company identified as specified in points b, c, d item 184.108.40.206 above must be recorded and presented as a separate item on the reported results of operations (in the item "interest Portion or hole in the associated companies the joint venture, ").
220.127.116.11. deferred income tax assets and deferred income tax payable arising from the interest or part of hole record investments in associated companies are carried out according to the provisions in point 3-item B-part I of circular No. 20/2006/TT-BTC dated 20/3/2006 of the Ministry of finance accounting instructor made six (6) accounting standards issued by the decision No. 12/2005/QD-BTC dated February 15, 2005 of the Minister of finance.
18.104.22.168. To cater for the consolidated financial statements, the Accounting Division merge to open the "detailed accounting to track investments to each affiliate company" and "Window track allocation difference arises when buying investments in associated companies".
a) detailed accounting to track the investments in associated companies:-detailed accounting of investments in associated companies must follow the following criteria: value logging investments in associated companies; Account adjustments at the end of each financial year corresponds to the part of the investor in the profits or losses of the associated companies; Tuning parts increase (decrease) the investment according to the value of the equity of associated companies but are not reflected in the reported results of operations of the company links; Account adjustments due to the financial statements of the investor and the company was established on other links; Account adjustments by investors and affiliates do not apply uniform accounting policies.
(The swine details enclosed)
XIV. IMPLEMENTATION GUIDE ACCOUNTING STANDARDS No. 26 "INFORMATION on RELATED PARTIES" 1. General provisions 1.1. Financial reporting (financial report presentation part) must present relationships with the related parties and transactions between related parties.
1.2. The following cases are considered (or not) are related parties are made according to the provisions of accounting standards no. 26 ' information about the parties involved ".
1.3. Not presented in the consolidated financial statements for the Corporation's internal transaction.
1.4. The enterprise is not presented transaction with related parties in the financial statements of the parent company, when this report was created and published together with the consolidated financial statements.
Case of financial statements of the parent company was formed and announced not with consolidated financial statements must be presented with related parties transactions in the financial statements of the parent company.
1.5. Not presented transaction with related parties in the financial statements of the subsidiary by the parent company that owns the whole if the parent company is well established in Vietnam and announced consolidated financial reporting in Vietnam.
The case of the parent company does not own the whole company or the parent company is established in a foreign country and not published consolidated financial reporting in Vietnam to present transactions with related parties in the financial statements of the subsidiary.
2. Specific guidelines implement the standard "information on the parties involved," 2.1. To determine the price of transactions between related parties may use the following principal methods:-not price control methods can be compared;
-Resale price method;
-Price method of capital plus interest.
a) controlled price method can be compared, determined by comparing the price of the goods sold on the market can compare to be economically that the seller has no relation with the buyer.
This method is often used in the case of goods and services provided in the transaction between the parties involved and the conditions of the sale as in the regular transaction. This method is also commonly used to determine the cost of the grants.
b) according to the resale price method, the transfer price for resellers is determined by deducting the resale price on a fare, reflecting the value which the seller wants to collect the cost of the her have reasonable interest rates. Here there are difficulties in the review to determine reasonable compensation for the expenses caused by the sale of donated back into the process.
This method is used in cases where goods are transferred between related parties before being sold to another party. This method is also used in the transfer of resources such as the ownership and service.
c) capital public interest price method is determined by adding up a consistent difference in the cost of the supply. Using this method has difficulty in identifying both the cost factor and difference. One of the standards of comparison can determine the transfer price is based on the rate of interest could compare was on turnover or on which the business of the same industry.
2.2. Financial statements must present some certain relationships between the stakeholders. The relationship is often noted is the transaction of the business leaders, especially in terms of salary and other terms of their loan, due to their important role for business. Besides the need to present the major trading company related nature and large investments balances with the group, with the associated companies and with the Board of Directors.
2.3. The principal transactions between related parties must also be presented in the financial report presentation of the business reported in the year in which the transactions which have influence, include:-the value of inventory is purchased or sold between the parties concerned;
-The value of fixed assets and other assets are bought or sold between the parties concerned;
-The value of services provided or received between the parties concerned;
-Value wholesale dealers offer between the parties concerned;
-Property rental transactions between related parties;
-Transfer of research and development;
-The grants (including loans and equity contributions with money or in-kind);
-Guarantee and collateral;
-The management contract.
2.4. The relationship between the parties involved there exists the control must be presented in the financial statements, are transactions between the parties concerned or not.
2.5. The case of transactions between related parties, the reporting enterprise should present the nature of the relationship of the parties involved as well as the types of transactions and the elements of the transaction.
The elements of the transactions typically include:-the volume of transactions performed by value or percentage respectively;
-Value or the respective percentage of the unpaid items;
2.6. The items of the same nature may be pooled except presentation the presentation separately is necessary to understand the effects of transactions between related parties with respect to the financial statements of the reporting enterprise. For example, the types of materials used for the manufacture of the product can present included into an item's "primary materials".
2.7. in the consolidated financial statements of the group is not necessary to present the transaction between members because this report stated up the information about the parent company and the subsidiary companies as a business report. Transactions with associated companies are accounted under the equity method was not excluded should therefore be presented separately as transactions with related parties.
XV. IMPLEMENTATION 1. This circular effect after 15 days from the date the quote and replace the circular No. 89/2002/TT-BTC on 9/10/2002, circular No. 105/2003/TT-BTC dated November 4, 2003 and circular No. 23/2005/TT-BTC dated 30 March 2005. What content other related accounting but no instructions in this circular shall follow the enterprise accounting mode current.
2. The regulations in accounting standards have different financial policy by the Ministry of Finance issued before issuing accounting standards shall follow the regulations in accounting standards and guidelines in this circular.
3. The Corporation, the company has a particular accounting regime has been the Ministry of finance approved, must base on this circular to guide appropriate supplements.
4. The ministries, the people's Committee, the Department of finance, tax the Province, central cities are responsible for deployment guide enterprises implement this circular. In the process if there are obstacles to suggest reflection on the Ministry of finance to study the resolution./.