financial statements template-en
TRANSCRIPT
KPMG Model VAS Financial Statements Version 2004-1
ClientNameHere
Set ReportName "ReportTitleHere" ReportTitleHere
Set RepSubTitle "Subtitle/optional date" Subtitle/optional date
set HdrInfo "KPMGCoreServiceorIndustryOptionalInsertDate" KPMGCoreServiceorIndustryOptionalInsertDate[ABC Company Limited]
Financial Statements for the year
Investment Licence NoXX/GP [date month year]
XX/GPDC1 [date month year]
XX/GPDC2 [date month year]
XX/GPDC3 [date month year]
Option 1: Where there are no licence updates
The investment licence was issued by the [Ministry of Planning and Investment] and is valid for XX years.
Option 2: Where there are licence updates
The investment licence and updates were issued by the [Ministry of Planning and Investment]. The investment licence is valid for XX years from the date of the initial investment licence.
Board of ManagementNameChairman
NameVice Chairman (until [date month year])
NameVice Chairman (from [date month year])
NameMember
NameMember
NameMember
NameMember
Board of DirectorsNameGeneral Director
NameDeputy General Director
Registered Office[address line 1]
[address line 2]
[address line 3]
Vietnam
AuditorsKPMG Limited
Vietnam
CodeNote2006VND'0002005VND'000
Restated
ASSETS
Current assets100XXXX
Cash and cash equivalents1103XXXX
Cash111XXXX
Cash equivalents112XXXX
Short-term investments12012XXXX
Short-term investments 121XXXX
Allowance for diminution in the value of short-term investments129(XX)(XX)
Accounts receivable - short-term1304XXXX
Accounts receivable - trade131XXXX
Prepayments to suppliers132XXXX
Inter-company receivables133XXXX
Excess of contract work-in-progress over progress billings134XXXX
Other receivables135XXXX
Allowance for doubtful debts139(XX)(XX)
Inventories1405XXXX
Inventories141XXXX
Allowance for inventories149(XX)(XX)
Other current assets150XXXX
Short-term prepayments151XXXX
Deductible value added tax152XXXX
Taxes and other receivables from State Treasury1546XXXX
Other current assets158XXXX
Long-term assets200XXXX
Accounts receivable - long-term2104XXXX
Accounts receivable - trade211XXXX
Operating capital given to branches212XXXX
Inter-company receivables213XXXX
Other receivables218XXXX
Allowance for doubtful debts219(XX)(XX)
Fixed assets220XXXX
Tangible fixed assets2217XXXX
Cost222XXXX
Accumulated depreciation223(XX)(XX)
Finance lease tangible fixed assets2248XXXX
Cost225XXXX
Accumulated depreciation226(XX)(XX)
Intangible fixed assets2279XXXX
Cost228XXXX
Accumulated amortisation229(XX)(XX)
Construction in progress23010XXXX
Investment property24011XXXX
Cost241XXXX
Accumulated depreciation242(XX)(XX)
Long-term investments25012XXXX
Investments in subsidiaries251XXXX
Investments in associates, joint-ventures252XXXX
Other long-term investments258XXXX
Allowance for diminution in the value of long-term investments259(XX)(XX)
Other long-term assets260XXXX
Long-term prepayments26113XXXX
Deferred tax assets26214XXXX
Other long-term assets268XXXX
TOTAL ASSETS270XXXX
RESOURCES
Liabilities300XXXX
Current liabilities310XXXX
Short-term borrowings and liabilities31115XXXX
Accounts payable trade312XXXX
Advances from customers313XXXX
Taxes payable to State Treasury31416XXXX
Payables to employees315XXXX
Accrued expenses31617XXXX
Inter-company payables31718XXXX
Excess of progress billings over contract work-in-progress31819XXXX
Other payables31920XXXX
Provisions32021XXXX
Long-term borrowings and liabilities33022XXXX
Accounts payable trade331XXXX
Inter-company payables33218XXXX
Other long-term liabilities333XXXX
Long-term borrowings and liabilities334XXXX
Deferred tax liabilities33514XXXX
Provision for severance allowance33621XXXX
Provisions33721XXXX
equity400XXXX
Equity410XXXX
[Contributed capital/ Share capital]41123XXXX
Capital surplus41223XXXX
Other capital413XXXX
Treasury shares41423(XX)(XX)
Differences upon asset revaluation415XXXX
Foreign exchange differences41624XXXX
Investment and development fund417XXXX
Financial reserves41825XXXX
Other equity funds419XXXX
Retained profits/(accumulated losses)420XX(XX)
Total resources440XXXX
Prepared by:Approved by:
NameName
Chief AccountantGeneral Director
CodeNote2006VND'0002005VND'000
Restated
Total revenue0126XXXX
Less sales deductions0226(XX)(XX)
Net sales10XXXX
Cost of sales1127(XX)(XX)
Gross profit/(loss)20XX(XX)
Financial income2128XXXX
Financial expenses2229(XX)(XX)
Selling expenses24(XX)(XX)
General and administration expenses25(XX)(XX)
Net operating profit/(loss)30XX(XX)
Results of other activities40
Other income3130XXXX
Other expenses3231(XX)(XX)
Profit/(loss) before tax50XX(XX)
Corporate income tax current5132(XX)(XX)
Corporate income tax deferred5232(XX)(XX)
Net profit/(loss) after tax60XX(XX)
Earnings per share33
Basic earnings per share70XXXX
Diluted earnings per shareXXXX
Prepared by:Approved by:
NameName
Chief AccountantGeneral Director
Add columns for differences upon asset revaluation and investment and development funds, if required. Delete columns not used.
[Contributed/share]
capitalVND'000Capital surplusVND000Foreign exchange differences VND'000Financialreserves
VND'000Retained profits/ (accumulated losses)
VND'000Total VND'000
Balance at 1 January 2005 as restatedXXXXXXXXXXXX
Balance at 1 January 2005
as previously statedXXXXXXXXXXXX
Adoption of new accounting policy(see Note 2(b))----XXXX
[Contributed capital/ Share capital issued]XXXX---XX
Unrealised exchange differences-(XX)---(XX)
Net profit/(loss) for the [period/year]----XXXX
Dividends----(XX)(XX)
Profits reinvestedXX---(XX)-
Balance at 1 January 2006 as restatedXX(XX)XXXXXXXX
Balance at 1 January 2006
as previously statedXXXXXXXXXXXX
Adoption of new accounting policy(see Note 2(b))----XXXX
[Contributed capital/ Share capital issued]XXXX---XX
Unrealised exchange differences-XX---XX
Net profit/(loss) for the [period/year]----XXXX
Dividends----(XX)(XX)
Profits reinvestedXX---(XX)-
Balance at [31 December 2006]XXXXXXXXXXXX
Prepared by:Approved by:
NameName
Chief AccountantGeneral Director
CodeNote2006VND'0002005VND'000
Cash flows from operating activities
Profit/(loss) before tax01XX(XX)
Adjustments for
Depreciation and amortisation02XXXX
Allowances and provisions
03XXXX
Unrealised foreign exchange (gains)/losses
04XX(XX)
(Profits)/losses from investing activities
05(XX)XX
Interest expense06XXXX
Operating profit/(loss) before changes in working capital08XX(XX)
(Increase)/decrease in receivables and other current assets09(XX)XX
Decrease/(increase) in inventories10XX(XX)
Increase/(decrease) in payables and other liabilities 11XX(XX)
(Increase)/decrease in prepayments12(XX)XX
(XX)XX
Interest paid13(XX)(XX)
Corporate income tax paid14(XX)(XX)
Other receipts from operating activities15XXXX
Other payments for operating activities16 (XX) (XX)
Net cash (used in)/generated from operating activities20(XX)XX
Cash flows from investing activities
Payments for additions to fixed assets and other long-term assets21(XX)(XX)
Proceeds from disposals of fixed assets and other long-term assets22XXXX
Payments for purchase of debt instruments of other entities23(XX)(XX)
Proceeds from sales of debt instruments of other entities24(XX)(XX)
Payments for investments in other entities25(XX)(XX)
Collections on investments in other entities26XXXX
Receipts of interests and dividends27XXXX
Net cash generated from/(used in) investing activities30XX(XX)
Cash flows from financing activities
Proceeds from equity issued31XXXX
Payments for shares returns and repurchases32(XX)(XX)
Proceeds from short-term and long-term borrowings33XXXX
Payments to settle debts 34(XX)(XX)
Payments to settle finance lease liabilities35(XX)(XX)
Payments of dividends36(XX)(XX)
Net cash generated from/(used in) financing activities40XX(XX)
Net cash flows during the [period/year]50(XX)XX
Cash and cash equivalents at the beginning of the [period/year]60XXXX
Impact of exchange rate fluctuations
61XX(XX)
Cash and cash equivalents at the end of the [period/year]703XXXX
Significant non-cash transactions
During the [period/year] there were the following significant non-cash transactions:
2006VND'0002005VND'000
Cost of fixed assets acquired by the Company as legal capital contributions from investorsXXXX
Cost of fixed assets acquired by the Company under finance leasesXXXX
Pre-operating expenses incurred by investors as legal capital contributionsXXXX
Acquisition of businesses by giving non-cash considerationsXXXX
Disposal of businesses for non-cash considerationsXXXX
Prepared by:Approved by:
NameName
Chief AccountantGeneral Director
These notes form an integral part of and should be read in conjunction with the accompanying financial statements.
1. Principal activities
The principal activities of [ABC Company Limited] (the Company), which is incorporated as a [100% foreign-owned company in Vietnam/joint venture company in Vietnam], are to [complete] under Investment Licence No XX issued by the [Ministry of Planning and Investment (MPI)] on [date month year] and amended on [date month year], [date month year], [date month year] and [date month year] (together referred to as the Investment Licence). The Investment Licence is valid for XX years from the initial investment licence date.
Paragraph 2, Case 1: normal disclosure
The total investment and legal capital amounts of the Company as stipulated in the Investment Licence and defined under the Law on Foreign Investment in Vietnam are USDXX and USDXX, respectively.Paragraph 2, Case 2: change of total invested capital in the current year
During the [period/year] the total investment and legal capital amounts of the Company were increased from USDXX to USDXX under revised Investment Licence No.XX dated [date month year].Paragraph 2, Case 3: liquidation of company
The total investment and legal capital amounts of the Company as stipulated in the investment licence and defined under the Law on Foreign Investment in Vietnam are USDXX and USDXX, respectively.On [date month year] the Directors applied to the [MPI] to liquidate the Company. In response to this request the Company received approval from the [MPI] to allow the Company to terminate its operations on [date month year].Paragraph 3 (mandatory)
As at [31 December 2006] the Company had XX employees (2005: XX employees).
2. Summary of significant accounting policies
The following significant accounting policies have been adopted by the Company in the preparation of these financial statements.
(a) Basis of financial statement preparation
(i) General basis of accounting (remove this heading if paragraph (ii) is not used)
Paragraph 1 (mandatory)
The financial statements, expressed in thousand Vietnam Dong (VND000)/United States Dollars (USD), have been prepared in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System and accounting principles generally accepted in Vietnam.Paragraph 2, first year of VAS application (if applicable)
Prior to [1 January 2006] the financial statements were prepared in accordance with International Financial Reporting Standards, issued by the International Accounting Standard Board. This change in the basis of accounting has been applied retrospectively in preparing the financial statements for the [period/year] ended [31 December 2006] and the comparative information presented for the year ended [31 December 2005].Paragraph 3 (mandatory)
The financial statements are prepared on the historical cost basis. During the year the Ministry of Finance has issued a number of new accounting standards that are effective for accounting periods beginning on or after 1 January 2006. Information on the changes in accounting policies resulting from initial application of these new accounting standards for the current and prior periods reflected in these financial statements is provided in Note 2 (b). Paragraph 4 (Consolidated financial statements have to be prepared unless the Company is itself wholly owned subsidiary of the parent company, which publishes consolidated financial statements)
Consolidated financial statements in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System and accounting principles generally accepted in Vietnam have not been prepared as the company is itself wholly owned subsidiary of XX, which publishes consolidated financial statements and has its registered office at XX.(ii) Going concern assumption
If applicable
The financial statements have been prepared on a going concern basis. The Company has incurred net loss after tax of VNDXX (2005: VNDXX) during the [period/year] and at the balance sheet date, current liabilities exceeded current assets by VNDXX (2005: VNDXX) and total liabilities exceeded total assets by VNDXX (2005: VNDXX). Furthermore, the Company has significant loans that will require refinancing within the next 12 months (Note XX). The validity of the going concern assumption fundamentally depends on the [investor/investors/ultimate holding company] continuing to provide such financial assistance as is necessary to enable the entity to meet its liabilities as and when they fall due and to maintain the entity in existence as a going concern for the foreseeable future.
At the time of this report, there is no reason for the [Directors/management] to believe that the [investor/investors/ultimate holding company] will not continue [its/their] support.(b) Adoption of new accounting policies
The Company adopted the following Vietnamese Accounting Standards issued by the Ministry of Finance that have become effective since 1 January 2006.
VAS 11 Business Combination;
VAS 18 Provisions, Contingent Assets and Liabilities
VAS 19 Insurance Contracts VAS 30 Earnings Per Share
Case 1: no restatement of corresponding figuresThe adoption of the new standards above did not result in restatements of prior year balances. [Certain comparative information has been reclassified to conform to the current year presentation.]Case 2: restatement of corresponding figures
The adoption of the new standards above was applied retrospectively and corresponding figures have been restated. The adoption of the new accounting standards had the following impact on these financial statements.
2006VND0002005
VND000
Balance sheet
[Details of captions affected]XXXX
XXXX
Statement of income
[Details of captions affected]XXXX
XXXX
(c) Fiscal year
Case 1: normal disclosure
The fiscal year of the Company is from [1 January] to [31 December] as approved by the Ministry of Finance in Letter No. XX dated [date month year].Case 2: first financial reporting period
The first fiscal period of the Company is from [date month year] to [31 December 2006] as approved by the Ministry of Finance in Letter No. XX dated [date month year]. Succeeding fiscal years will be from [1 January] to [31 December].
(d) Change in reporting currency
On [1 January 2006] the Company changed its reporting currency from United States Dollars (USD) to Vietnam Dong (VND). All balances in USD as at [31 December 2005], except for tangible fixed assets, have been translated from USD to VND at the exchange rate of VNDXX to USD1. Fixed assets have been translated from USD to VND at historical exchange rates. The foreign exchange differences that have arisen from this translation are recorded in the Differences Upon Asset Revaluation account in equity. These differences cannot be distributed until the Company is liquidated.
The corresponding figures in VND as at and for the [period/year] ended 31 December 2005, which are shown for information purposes only, have been calculated by translating the amounts in the financial statements as at 31 December 2005 at the exchange rate of VNDXX to USD1, except for fixed assets which are translated from USD to VND at historical rates.
(e) Foreign currency transactions
Monetary assets and liabilities denominated in currencies other than VND[, except for items hedged by financial instruments,] are translated into VND at rates of exchange ruling at the balance sheet date. Transactions in currencies other than VND during the [period/year] have been translated into VND at rates approximating those ruling at the transaction dates.
Case 1: normal disclosure
All realised and unrealised foreign exchange differences are recorded in the statement of income.
Case 2: disclosure where the company is pre-operating and construction stage
All realised and unrealised foreign exchange differences are recorded in statement of income, except when they relate to the construction of tangible fixed assets or the translation of foreign currency monetary items during the Companys pre-operating stage, in which case they are recorded in the Foreign Exchange Difference Account in equity until the Company commences operations and the tangible fixed assets are put into use. Once the Company commences operations and the tangible fixed assets are put into use, the related realised foreign exchange differences are transferred to the statement of income, unrealised foreign exchange gains are transferred to the Unearned Revenue Account and unrealised foreign exchange losses are transferred to the Long-term Prepayment Account. The unrealised gains and losses are then amortised on a straight line basis over five years.
(f) Cash and cash equivalentsCash comprises cash balances and call deposits. Cash equivalents are short-term highly liquid investments that are readily convertible to known amount of cash, are subject to an insignificant risk of changes in value, and are held for the purpose of meeting short- term cash commitments rather than for investment or other purposes. Bank overdrafts that are repayable on demand and form an integral part of the Companys cash management are included as a component of cash and cash equivalents for the purpose of the statement of cash flows.
(g) Investments
Investments are stated at cost. Allowance is made for reductions in investment values which in the opinion of the [Directors/management] are not temporary. The allowance is reversed if the subsequent increase in recoverable amount can be related objectively to an event occurring after the allowance was recognised. An allowance is reversed only to the extent that the investments carrying amount does not exceed the carrying amount that has been determined if no allowance had been recognised.
(h) Accounts receivable
Trade and other receivables are stated at cost less allowance for doubtful debts.
(i) Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is determined on a [first-in-first-out /weighted average basis] and includes all costs incurred in bringing the inventories to their present location and condition. Cost in the case of finished goods and work in progress includes raw materials, direct labour and attributable manufacturing overheads. Net realisable value is the estimated selling price of inventory items, less the estimated costs of completion and selling expenses. The Company applies the [perpetual/periodic] method of accounting for inventory.
(j) Tangible fixed assets
(i) Cost
Tangible fixed assets are stated at cost less accumulated depreciation. The initial cost of a tangible fixed asset comprises its purchase price, including import duties, non-refundable purchase taxes and any directly attributable costs of bringing the asset to its working condition and location for its intended use. Expenditure incurred after tangible fixed assets have been put into operation, such as repairs and maintenance and overhaul costs, are normally charged to income in the [period/year] in which the costs are incurred. In situations where it can be clearly demonstrated that the expenditure have resulted in an increase in the future economic benefits expected to be obtained from the use of tangible fixed assets beyond their originally assessed standard of performance, the expenditure are capitalised as an additional cost of tangible fixed assets.
(ii) Depreciation
Depreciation is computed on a straight-line basis over the estimated useful lives of tangible fixed assets. The estimated useful lives are as follows:
buildingsXX XX years
leasehold improvementsXX XX years
office equipment XX XX years
plant and equipment XX XX years
fixtures and fittingsXX XX years
motor vehicles XX XX years
During the [period/year], the Company revised the estimated useful lives of motor vehicles from XX years to XX years to more accurately reflect the useful lives of these assets. The effect on the depreciation charge for the [period/year] was to [increase/decrease] the depreciation charge by VNDXX.
(k) Finance lease tangible fixed assets
Leases in terms of which the Company assumes substantially all the risks and rewards of ownership are classified as finance leases. Tangible fixed assets acquired by way of finance leases are stated at an amount equal to the lower of fair value and the present value of the minimum lease payments at inception of the lease, less accumulated depreciation.
Depreciation on leased assets is computed on a straight-line basis over the estimated useful lives of items of the leased assets. The estimated useful lives of leased assets are consistent with the useful lives of tangible fixed assets as described in accounting policy 2(j).
(l) Intangible fixed assets
(i) Land use rights
Land use rights are stated at cost less accumulated amortisation. The initial cost of a land use right comprises [the value of the right as stated in the Investment Licence/its purchase price] and any directly attributable costs incurred in conjunction with securing the land use right. Amortisation is computed on a straight-line basis over XX years.
(ii) Software
Cost of acquisition of new software, which is not an integral part of the related hardware, is capitalised and treated as an intangible asset. Software is amortised on a straight-line basis over XX years.
(iii) Development costs
Expenditure on development activities, whereby research findings are applied to a plan or design for the production of new or substantially improved products and process, is capitalised if the product or process is technically and commercially feasible and the Company has sufficient resources to complete development. The expenditure capitalised include the costs of materials, direct labour and an appropriate portion of overheads. Other development expenditure is recognised in the statement of income as an expense as incurred. Capitalised development expenditure is stated at cost less accumulated amortisation, which is provided on a straight-line basis over XX years.
(m) Investment property
(i) Cost
Investment property is stated at cost less accumulated depreciation. The initial cost of an investment property comprises its purchase price, cost of land use rights and any directly attributable costs of bringing the asset to its working condition for its intended use. Expenditure incurred after investment property has been put into operation, such as repairs and maintenance, are normally charged to income in the [period/year] in which the costs are incurred. In situations where it can be clearly demonstrated that the expenditure have resulted in future economic benefits in excess of the originally assessed standard of performance of the existing investment property, the expenditure are capitalised as an additional cost of investment property.
(ii) Depreciation
Depreciation is computed on a straight-line basis over the estimated useful lives of investment property. The estimated useful lives are as follows:
land use rightsXX XX years
buildingsXX XX years
During the [period/year], the Company revised the estimated useful lives of [land use rights/ buildings] from XX years to XX years to more accurately reflect the useful lives of these assets. The effect on the depreciation charge for the [period/year] was to [increase/decrease] the [depreciation] charge by VNDXX.
(n) Construction in progress
Construction in progress represents the cost of [construction and machinery] which have not been fully [completed or installed]. No depreciation is provided for construction in progress during the period of [construction and installation].
(o) Contract work-in-progress
Contract work-in-progress is stated at cost plus attributable profits earned to date less provision for foreseeable losses. Cost represents directly attributable and chargeable costs in accordance with the underlying contract.
(p) Long-term prepayments
(i) Pre-operating expenses
Pre-operating expenses are recorded in the statement of income, except for establishment costs and expenditures on training, advertising and promotional activities incurred from the incorporation date to the commercial operation date, being [the date of commencement of trial production]. These expenses are recognised as long-term prepayments, initially stated at cost, and are amortised on a straight line basis over three years starting from the date of commercial operation.
(ii) Technology assistance fees
Technology assistance fees are incurred for technology assistance provided by XX over XX years commencing from XX and are amortised on a straight-line basis over the term of the technology assistance contract.
(iii) Prepaid land costs
Prepaid land costs comprise prepaid land lease rentals and other costs incurred in conjunction with securing the use of leased land. These costs are recognised in the statement of income on a straight-line basis over the term of the lease of XX years.
(iv) Golf club memberships
Golf club memberships are recorded at cost and amortised on a straight-line basis over XX years.
(q) Trade and other payables
Trade and other payables are stated at their cost.
(r) Provisions
A provision is recognised if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. In respect of provision for warranty, the amount provided is limited to 5% of related revenue in accordance with Circular 13/2006/TT-BTC dated 27 February 2006.
(s) Taxation
Income tax on the profit or loss for the [period/year] comprises current and deferred tax. Income tax is recognised in the statement of income except to the extent that it relates to items recognised directly to equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the [period/year], using tax rates enacted or substantially enacted at the balance sheet date, and any adjustment to tax payable in respect of previous [periods/years].
Deferred tax is provided using the balance sheet liability method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities using tax rates enacted or substantively enacted at the balance sheet date.
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised.
(t) Revenue
(i) Goods sold
Revenue from the sale of goods is recognised in the statement of income when the significant risks and rewards of ownership have been transferred to the buyer. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due or the possible return of goods.
(ii) Services rendered
Revenue from services rendered is recognised in the statement of income in proportion to the stage of completion of the transaction at the balance sheet date. The stage of completion is assessed by reference to work performed. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due.
(iii) Processing services
Revenue from processing services is recognised in the statement of income when the goods have been processed and accepted by the buyer. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due.
(iv) Construction contracts
Revenue from construction contracts is recognised in the statement of income in proportion to the stage of completion of the contract when the outcome of a construction contract can be estimated reliably. The stage of completion is assessed by reference to surveys of work performed. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due.
(v) Rental income
Rental income from leased property is recognised in the statement of income on a straight-line basis over the term of the lease. Lease incentives granted are recognised as an integral part of the total rental income.
(u) Operating lease payments
Payments made under operating leases are recognised in the statement of income on a straight-line basis over the term of the lease. Lease incentives received are recognised in the statement of income as an integral part of the total lease expense.
(v) Borrowing costs
Borrowing costs are recognised as an expense in the [period/year] in which they are incurred, except where the borrowing costs relate to borrowings in respect of the construction of tangible fixed assets, in which case the borrowing costs incurred during the period of construction are capitalised as part of the cost of the fixed assets concerned.
(w) Earnings per share
The Company presents basic and diluted earnings per share (EPS) for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to the ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the [period/year]. Diluted EPS is determined by adjusting the profit or loss attributable to the ordinary shareholders and the weighted average number of ordinary shares outstanding for the effect of all dilutive potential ordinary shares, which comprise convertible bonds and share options.
(x) Related companies
Related companies include the [investor/investors] and [its/their] ultimate parent [company companies] and [its/their] subsidiaries and associates.
(y) Off balance sheet items
Amounts which are defined as off balance sheet items under the Vietnamese Accounting System are disclosed in the relevant notes to these financial statements.
3. Cash and cash equivalents2006VND0002005VND000
Cash on handXXXX
Cash in bankXXXX
Cash equivalents
XXXX
Cash and cash equivalentsXXXX
Bank overdrafts(XX)(XX)
Cash and cash equivalents in the statement of cash flowsXXXX
Cash at [31 December 2006] included amounts denominated in currencies other than VND amounting to VNDXX million (2005: VNDXX million).
Cash in bank at [31 December 2006] included VNDXX million (2005: VNDXX million) pledged with banks as security for loans granted to the Company.
Cash in bank at [31 December 2006] included VNDXX million (2005: VNDXX million) which is subject to restriction in use according to [specify legal or other applicable restriction].
4. Accounts receivable - short-term [and long-term]Inter-company receivables comprised:
2006VND0002005VND000
Amounts due from related companies
TradeXXXX
Non-tradeXXXX
XXXX
The non-trade amounts due from related companies were unsecured, interest free and had no fixed terms of repayment.
Excess of contract work-in-progress over progress billings and advances from customers comprised:
2006VND0002005VND000
Contract work-in-progressXXXX
Attributable profits based on percentage of completionXXXX
XXXX
XXXX
Progress billings and advances from customers(XX)(XX)
XXXX
Provision for foreseeable losses(XX)(XX)
XXXX
Movements in the provision for foreseeable losses during the [period/year] were as follows:
2006VND0002005VND000
Opening balanceXXXX
Increase in provision during the [period/year]XX XX
Utilised during the [period/year](XX)(XX)
Closing balanceXXXX
Other receivables comprised:2006VND0002005VND000
AdvancesXXXX
Short-term depositsXXXX
OthersXXXX
XXXX
Movements in the allowance for doubtful debts during the [period/year] were as follows:
2006VND0002005VND000
Opening balanceXXXX
Increase in allowance during the [period/year]XXXX
Allowance utilised during the [period/year](XX)(XX)
Written back(XX)(XX)
Closing balanceXXXX
Allowance for doubtful debts - long-term(XX)(XX)
Allowance for doubtful debts - short-termXXXX
At [31 December 2006] accounts receivable with a carrying value of VNDXX million (2005: VNDXX million) were pledged with banks as security for loans granted to the Company.
5. Inventories
2006VND0002005VND000
Goods in transit
XXXX
Raw materialsXXXX
Tools and suppliesXXXX
Work in progressXXXX
Finished goodsXXXX
Merchandise inventoryXXXX
Goods on consignmentXXXX
PropertiesXXXX
XXXX
Allowance for inventories(XX)(XX)
XXXX
Movements in the allowance for inventories during the [period/year] were as follows:
2006VND0002005VND000
Opening balanceXXXX
Increase in allowance during the [period/year]XXXX
Allowance utilised during the [period/year](XX)(XX)
Written back(XX)(XX)
Closing balanceXXXX
At [31 December 2006] inventories with a carrying value of VNDXX million (2005: VNDXX million) were pledged with banks as security for loans granted to the Company.
Included in finished goods at [31 December 2006] was VNDXX million (2005: VNDXX million) of inventories carried at net realisable value.
6. Taxes and other receivables from State Treasury2006VND0002005VND000
Taxes over-paid to State Treasury
Corporate income taxXXXX
Special consumption taxXXXX
Import-export taxXXXX
Natural resource taxesXXXX
Land and housing taxesXXXX
Other taxesXXXX
Other receivables from State TreasuryXXXX
XXXX
7. Tangible fixed assets
BuildingsLeasehold improvementsOffice equipmentPlant and equipmentFixtures and fittingsMotor vehiclesTotal
VND000VND000VND000VND000VND000VND000VND000
Cost
Opening balanceXXXXXXXXXXXXXX
AdditionsXXXXXXXXXXXXXX
Transfers from construction in progressXXXXXXXXXXXXXX
Transfers [from/(to)] investment property(XX)-----(XX)
Disposals(XX)(XX)(XX)(XX)(XX)(XX)(XX)
Written off(XX)(XX)(XX)(XX)(XX)(XX)(XX)
Reclassifications--(XX)XX---
Closing balanceXXXXXXXXXXXXXX
Accumulated depreciation
Opening balanceXXXXXXXXXXXXXX
Charge for the [period/year] XXXXXXXXXXXXXX
Transfers [from/(to)] investment property(XX)-----(XX)
Disposals (XX)(XX)(XX)(XX)(XX)(XX)(XX)
Written off(XX)(XX)(XX)(XX)(XX)(XX)(XX)
Reclassifications--XX(XX)---
Closing balanceXXXXXXXXXXXXXX
Net book value
Closing balance XXXXXXXXXXXXXX
Opening balance XXXXXXXXXXXXXX
Included in the cost of tangible fixed assets were assets costing VNDXX million which were fully depreciated as of [31 December 2006] (2005: VNDXX million), but which are still in active use.
The carrying amount of tangible fixed assets retired from active use and held for disposal amounted to VNDXX million as of [31 December 2006] (2005: VNDXX million).
The carrying amount of temporarily idle equipment in tangible fixed assets amounted to VNDXX million as of [31 December 2006] (2005: VNDXX million).
During the [period/year] borrowing costs capitalised in tangible fixed assets amounted to VNDXX million (2005: VNDXX million).
At [31 December 2006] tangible fixed assets with a carrying value of VNDXX million (2005: VNDXX million) were pledged with banks as security for loans granted to the Company.
8. Finance lease tangible fixed assets
BuildingsOffice equipmentPlant and equipmentMotor vehiclesTotal
VND000VND000VND000VND000VND000
Cost
Opening balanceXXXXXXXXXX
AdditionsXXXXXXXXXX
Transfers to investment property(XX)---(XX)
Disposals(XX)(XX)(XX)(XX)(XX)
Written off(XX)(XX)(XX)(XX)(XX)
Reclassifications-(XX)XX--
Closing balanceXXXXXXXXXX
Accumulated depreciation
Opening balanceXXXXXXXXXX
Charge for the [period/year] XXXXXXXXXX
Transfers to investment property(XX)---(XX)
Disposals (XX)(XX)(XX)(XX)(XX)
Written off(XX)(XX)(XX)(XX)(XX)
Reclassifications-XX(XX)--
Closing balanceXXXXXXXXXX
Net book value
Closing balance XXXXXXXXXX
Opening balance XXXXXXXXXX
The Company leases production equipment under various finance lease agreements. At the end of each of the leases the Company has the option to purchase the equipment at a beneficial price. The leased equipment secures the lease obligations.
Included in the cost of finance lease tangible fixed assets were assets costing VNDXX million which were fully depreciated as of [31 December 2006] (2005: VNDXX million), but which were still in active use.
The carrying amount of finance lease tangible fixed assets retired from active use and held for disposal amounted to VNDXX million as of [31 December 2006] (2005: VNDXX million).
The carrying amount of temporarily idle equipment in finance lease tangible fixed assets amounted to VNDXX million as of [31 December 2006] (2005: VNDXX million).
During the [period/year] the contingent rent of the Companys finance lease tangible fixed assets recognised in the statement of income amounted to VNDXX million (2005: VNDXX million). The contingent rent is based on [complete based on Companys specific circumstances].9. Intangible fixed assets
Land use rightsDevelopment costsSoftwareTotal
VND000VND000VND000VND000
Cost
Opening balanceXXXXXXXX
Transfers from long-term prepaymentsXX--XX
Transfers [from/(to)] investment property(XX)--(XX)
AdditionsXXXXXXXX
Disposals(XX)(XX)(XX)(XX)
Written off(XX)(XX)(XX)(XX)
Closing balanceXXXXXXXX
Accumulated amortisation
Opening balanceXXXXXXXX
Transfers from long-term prepaymentsXX--XX
Transfers [from/(to)] investment property(XX)--(XX)
Charge for the [period/year] XXXXXXXX
Disposals (XX)(XX)(XX)(XX)
Written off(XX)(XX)(XX)(XX)
Closing balanceXXXXXXXX
Net book value
Closing balance XXXXXXXX
Opening balance XXXXXXXX
Included in the cost of intangible fixed assets were assets costing VNDXX million which were fully amortised as of [31 December 2006] (2005: VNDXX million), but which are still in use.
At [31 December 2006] intangible fixed assets with a carrying value of VNDXX million (2005: VNDXX million) were pledged with banks as security for loans granted to the Company.
10. Construction in progress
2006VND0002005VND000
Opening balanceXXXX
Additions during the [period/year]XXXX
Written off(XX)(XX)
Transfers to tangible fixed assets (XX)(XX)
Closing balanceXXXX
At [31 December 2006] construction in progress with a carrying value of VNDXX million (2005: VNDXX million) were pledged with banks as security for loans granted to the Company.During the [period/year], borrowing costs capitalised into construction in progress amounted to VNDXX million (2005: VNDXX million).
11. Investment property
Land use rightsBuildingsTotal
VND000VND000VND000
Cost
Opening balanceXXXXXX
New acquisitionsXXXXXX
Capitalised subsequent expenditureXXXXXX
Transfer [from/(to)] tangible fixed assets(XX)(XX)(XX)
Disposals(XX)(XX)(XX)
Closing balanceXXXXXX
Accumulated depreciation
Opening balanceXXXXXX
Charge for the [period/year] XXXXXX
Transfer [from/(to)] tangible fixed assets(XX)(XX)(XX)
Disposals (XX)(XX)(XX)
Closing balanceXXXXXX
Net book value
Closing balance XXXXXX
Opening balance XXXXXX
Case 1: Fair value information is available.
At [31 December 2006] the fair value of the Companys investment property as determined by [the Directors/independent valuers] is VNDXX million (2005: VNDXX million).
Case 2: Fair value information is not available.
The Companys investment property is [an apartment building located at XX].The fair value of investment property has not been determined as [the Company has not performed a valuation/there was no recent market transaction for similar property in the same location as the Companys investment property/there is no active market for such property].12. Investments
2006VND0002005VND000
Long term equity investments in:
SubsidiariesXXXX
AssociatesXXXX
joint venturesXXXX
others XXXX
Long-term corporate bondsXXXX
Long term treasury bonds
Long-term loansXXXX
Other long term investmentsXXXX
XXXX
Allowance for diminution in value of long-term investments(XX)(XX)
XXXX
Short term investments in:
securitiesXXXX
term depositsXXXX
XXXX
Allowance for diminution in value of short-term investments(XX)(XX)
XXXX
Movements in the allowance for diminution in value of investments during the [period/year] were as follows:
Short-termLong-term
2006VND0002005VND0002006VND0002005VND000
Opening balanceXXXXXXXX
Increase in allowance during the [period/year]XXXXXXXX
Allowance utilised during the [period/year](XX)(XX)(XX)(XX)
Written back(XX)(XX)(XX)(XX)
Closing balanceXXXXXXXX
At [31 December 2006] [short-term/long-term] investments with a carrying value of VNDXX million (2005: VNDXX million) were pledged with banks as security for loans granted to the Company.
Details of the investments in subsidiaries and associates are as follows:
NamePrincipal activityInvestment
licence % of ownershipAmount
2006USD2005USD
Subsidiaries
[Name of Subsidiary 1]
[Business activities of Subsidiary 1]
XX/GP issued by [MPI] on [date] and amended on [date].XX%
XXXX
[Name of Subsidiary 2]
[Business activities of Subsidiary 2]
XX/GP issued by [MPI] on [date] and amended on [date].XX%
XXXX
Associate
[Name of Associate 1]
[Business activities of Associate 1]
XX/GP issued by [MPI] on [date] and amended on [date].XX%
XXXX
XXXX
13. Long-term prepayments
Pre-operating expensesTechnology assistance feesPrepaid land costsGolf club membershipsForeign exchange differencesTotal
VND000VND000VND000VND000VND000VND000
Opening balance-XXXXXXXXXX
Transfers from foreign exchange difference account----XXXX
AdditionsXXXXXXXXXXXX
Disposals(XX)(XX)(XX)(XX)(XX)(XX)
Written off(XX)(XX)(XX)(XX)(XX)(XX)
Amortisation for the [period/year] (XX)(XX)(XX)(XX)(XX)(XX)
Closing balanceXXXXXXXXXXXX
14. Deferred tax assets and liabilities(i) Recognised deferred tax assets
Deferred tax assets are attributable to the following:
2006VND'0002005VND'000
Fixed assetsXXXX
Allowances and provisions XXXX
Tax value of loss carry-forwards recognisedXXXX
Other itemsXXXX
XXXX
(ii) Unrecognised deferred tax assets
Deferred tax assets have not been recognised in respect of the following items:
2006VND'0002005VND000
Deductible temporary differencesXXXX
Tax lossesXXXX
XXXX
The tax losses expire in [2007./the following years:]
Year of expiryStatus of tax reviewTax losses available
VND000
2007FinalisedXX
2008FinalisedXX
2009OutstandingXX
2010OutstandingXX
2011OutstandingXX
XX
The deductible temporary differences do not expire under current tax legislation. Deferred tax assets have not been recognised in respect of these items because it is not probable that future taxable profit will be available against which the Company can utilise the benefits therefrom.
(iii) Recognised deferred tax liabilitiesDeferred tax liabilities are attributable to the following:
2006
VND'0002005
VND'000
Fixed assetsXXXX
Allowances and provisions (XX)(XX)
Tax value of loss carry-forwards recognised(XX)(XX)
Other itemsXXXX
XXXX
(iv) Movement in temporary differences during the [peiod/year][Not required if the amount of deferred tax recognised in the statement of income is apparent from the changes in the deferred tax balances]
2005Recognised in incomeRecognised in equity2006
Fixed assetsXX(XX)XX(XX)
Allowances and provisions(XX)(XX)-(XX)
Tax value of loss carry-forwards recognised(XX)(XX)-(XX)
Other itemsXXXXXXXX
(XX)(XX)XX(XX)
15. Short-term borrowings and liabilities
2006VND0002005VND000
Short-term borrowingsXXXX
Current portion of long-term liabilitiesXXXX
Current portion of finance lease liabilitiesXXXX
Matured bondsXXXX
XXXX
[Disclose amount of borrowings that are secured and unsecured, nature of security and interest rate range. Also disclose amount of borrowings from related company]
At [31 December 2006], VNDXX million (2005: VNDXX million) of the short-term borrowings were due to a related company and were [secured by XX/unsecured]. VNDXX million (2005: VNDXX million) of the remaining short-term borrowings were secured by XX. The remaining short-term borrowings were unsecured. The borrowings bore interest at rates ranging from XX% to XX% (2005: XX% to XX%) per annum during the [period/year].
16. Taxes payable to State Treasury
2006VND0002005VND000
Taxes
Value added taxXXXX
Special consumption taxXXXX
Import-export taxXXXX
Corporate income taxXXXX
Personal income taxXXXX
Natural resource taxesXXXX
Land and housing taxesXXXX
Land rentalXXXX
Other taxesXXXX
Other obligations
Extra collectionsXXXX
DutiesXXXX
Other obligationsXXXX
XXXX
17. Accrued expenses2006VND0002005VND000
(nature of accrued expenses)XXXX
(nature of accrued expenses)XXXX
OthersXXXX
XXXX
18. Inter-company payables
2006VND0002005VND000
Amounts due to related companies
TradeXXXX
Non-tradeXXXX
XXXX
Repayable within twelve months(XX)(XX)
Repayable after twelve monthsXXXX
The non-trade amounts due to related companies were unsecured, interest free and had no fixed terms of repayment.
19. Excess of progress billings over contract work-in-progress
Excess of progress billings and advances from customers over contract work-in-progress comprised:
2006VND0002005VND000
Contract work-in-progressXXXX
Attributable profits based on percentage of completionXXXX
XXXX
Progress billings and advances from customers(XX)(XX)
(XX)(XX)
Provision for foreseeable losses(XX)(XX)
(XX)(XX)
Movements in the provision for foreseeable losses during the [period/year] were as follows:
2006VND0002005VND000
Opening balanceXXXX
Increase in provision during the [period/year]XX XX
Utilised during the [period/year](XX)(XX)
Closing balanceXXXX
20. Other payablesOther payables comprised:
2006VND0002005VND000
Social insuranceXXXX
Health insuranceXXXX
Short-term deposits and collaterals receivedXXXX
Unearned revenueXXXX
OthersXXXX
XXXX
21. ProvisionsMovement of provisions during the [period/year] were as follows:
Site restorationWarrantiesSubtotalSeverance allowanceTotal
VND000VND000VND000VND000VND000
Opening balanceXXXXXXXXXX
Provision made during the [period/year]XXXXXXXXXX
Provision used during the [period/year](XX)(XX)(XX)(XX)(XX)
Provision reversed during the [period/year](XX)(XX)(XX)(XX)(XX)
Unwind of discountXXXXXXXXXX
Closing balanceXXXXXXXXXX
Non-currentXXXXXXXXXX
CurrentXXXXXXXXXX
XXXXXXXXXX
(i) Site restoration[In accordance with the Investment Licence, the Company has the obligation to restore the land on which its factory is located to its original condition at the end of its licensed period. The provision has been calculated using a discount rate of XX%. The restoration costs are expected to be incurred at the end of the licensed period. Amount provided during the [peiod/year] has been capitalised as an item of tangible fixed assets.]
(ii) Warranties[The provision for warranties relates mainly to goods sold and services rendered during the year ended [31 December 2006] and 2005. The provision is based on estimates derived from historical warranty data associated with similar products and services..
(iii) Severance allowance[Under the Vietnamese Labour Code, when an employee who has worked for his/her employer for 12 months or more voluntarily terminates his/her labour contract, the employer is required to pay the employee a severance allowance based on the number of years of service. Provision for severance allowance is calculated based on employees current salary level and their service time. ]
22. Long-term borrowings and liabilities
2006VND0002005VND000
Long-term borrowings
Loan 1 from XX Bank (a)XXXX
Loan 2 from XX Bank (b)XXXX
XXXX
Finance lease liabilities (c)XXXX
Long-term bonds issued (d)XXXX
Other long-term liabilitiesXXXX
XXXX
Repayable within twelve months(XX)(XX)
Repayable after twelve monthsXXXX
[Disclose if borrowings are secured or unsecured, nature of security and net book value of assets pledged, repayment terms and interest rate range]a.This loan is secured by a fixed deposit of VNDXX million (2005: VNDXX million) pledged with the lender. The loan bore interest at rates ranging from XX% to XX% (2005: XX%) per annum during the [period/year] and the remaining balance at [31 December 2006] is repayable in XX equal quarterly installments of VND XX each.b.This loan is secured by fixed assets with net book value as at [31 December 2006] of VNDXX million (2005: VNDXX million) and a fixed deposit included in cash at bank of VNDXX million (2005: VNDXX million). The loan bore interest at rates ranging from XX% to XX% (2005: XX% to XX%) per annum during the [period/year]. The loan is repayable in XX equal semi-annual instalments amounting to VNDXX million each and a final instalment comprising the remaining balance, commencing one year after the drawdown date of [date month year].
c.The future minimum lease payments under non-cancellable finance leases were:
2006VND0002005VND000
PaymentsInterestPrincipalPaymentsInterestPrincipal
Within one yearXXXXXXXXXXXX
Within two to five yearsXXXXXXXXXXXX
More than five yearsXXXXXXXXXXXX
XXXXXXXXXXXX
d.Long-term bonds represent those issued on [insert date of issuance] with a term of [insert term of bonds]. The bonds were unsecured, bore interest at rates ranging from XX% to XX% (2005: XX%) per annum during the [period/year] and the remaining balance at [31 December 2006] is redeemable in XX equal quarterly installments of VND XX each.
23. Contributed capital
Case 1: Foreign invested company or limited company which does not issue shares
[Disclosed authorised and contributed capital, movements in contributed capital, immediate and ultimate parent companies]
Paragraph 1a: Authorised capital
The Companys authorised and contributed legal capital are:AuthorisedContributed
USD%USDEquivalent
VND000%
Party AXXXX%XXXXXX%
Party BXXXX%XXXXXX%
Party CXXXX%XXXXXX%
XX100%XXXX100%
Paragraph 1b: Authorised capital (alternative where there is one investor and the capital has been fully contributed)
The Companys authorised legal capital has been fully contributed by [investors name], which is incorporated in [country].Paragraph 2: Movements in contributed legal capital if there had been movements in the current year.
Movements in contributed legal capital during the [period/year] were as follows:
2006VND0002006VND000
Balance at beginning of the [period/year]XXXX
Withdrawal of capital by [insert Investors name]XXXX
Capital contribution by extension of land use rights XXXX
Cash contribution by [insert Investors name]XXXX
Balance at end of the [period/year]XXXX
Paragraph 3: parent company
The parent company, [complete name], and the ultimate parent company [complete name], are incorporated in [country] and [country], respectively.
Paragraph 4: outstanding capital contributions
If the legal capital has not been fully contributed and the remaining legal capital will be contributed in future in accordance with the feasibility study.
The remaining legal capital is due to be contributed in accordance with the following timetable as set out in the Companys feasibility study:
Year2006VND0002005VND000
2007XXXX
2008XXXX
2009XXXX
2010XXXX
EtcXXXX
XXXX
If the legal capital has not been contributed in accordance with the feasibility study.
The investors have not fully contributed the legal capital in accordance with the timetable set out in the feasibility study because [explain reason and proposed remedial action, ie how/when the legal capital will be contributed].
Case 2: Joint stock company
The Companys authorised and issued share capital are:20062005
Number of sharesVND000Number of sharesVND000
Authorised share capitalXXXXXXXX
Issued share capital
Ordinary sharesXXXXXXXX
Preference sharesXXXXXXXX
XXXXXXXX
Treasury shares
Ordinary sharesXXXXXXXX
Preference sharesXXXXXXXX
XXXXXXXX
Shares currently in circulation
Ordinary sharesXXXXXXXX
Preference sharesXXXXXXXX
XXXXXXXX
All ordinary shares have a par value of VNDXX. Each share is entitled to one vote at meetings of the Company. Shareholders are entitled to receive dividend as declared from time to time. All ordinary shares are ranked equally with regard to the Companys residual assets. In respect of shares bought back by the Company, all rights are suspended until those shares are reissued
Preference shares have a par value of VNDXX. These are not entitled to vote at meetings of the Company. [Describe dividend schemes applicable to preference shares].Movement in share capital during the [period/year] was as follows:
20062005
Number of sharesVND000Number of sharesVND000
Balance at the beginning of the [period/year]XXXXXXXX
Shares issued during the [period/year]XXXXXXXX
Treasury shares purchased during the [period/year](XX)(XX)(XX)(XX)
Reduction in share capital during the [period/year](XX)(XX)(XX)(XX)
Balance at the end of the [period/year]XXXXXXXX
24. Foreign exchange differences
2006VND0002005VND000
Balance at beginning of the [period/year]XXXX
Net exchange differencesXXXX
Transfers to long-term prepayment and/or unearned revenueXXXX
Balance at end of the [period/year]XXXX
25. Financial reserve
Prior to 1 July 2000, the Law on Foreign Investment in Vietnam required foreign invested joint venture companies to allocate 5% of their profit after tax for the year to a non-distributable legal reserve which should not exceed 10% of the Companys legal capital. This requirement was abolished from 1 July 2000. Accordingly, the Company has not made additional allocations to this reserve. The Ministry of Finance has permitted enterprises to either maintain this reserve or transfer it to distributable earnings. The Company has elected to [transfer the balance of the reserve to retained earnings during the year/maintain the balance of the reserve]26. Total revenue
Total revenue represents the gross invoiced value of goods sold and services rendered exclusive of value added tax.Net sales comprised
2006VND0002005VND000
Total revenue
SalesXXXX
ServicesXXXX
Rental income from investment propertyXXXX
Construction contractXXXX
Less sales deductions
Sales discounts(XX)(XX)
Sales allowances(XX)(XX)
Sales returns(XX)(XX)
Special sales taxes (XX)(XX)
Export duties(XX)(XX)
Net salesXXXX
27. Cost of sales
2006VND0002005VND000
Total cost of sales
Finished goods soldXXXX
Merchandise goods soldXXXX
Services providedXXXX
Rental of investment propertyXXXX
Construction contractXXXX
Inventory lossesXXXX
Allowance for inventoriesXXXX
XXXX
28. Financial income
2006VND0002005VND000
Interest income
Related partiesXXXX
BanksXXXX
OthersXXXX
Income from investments XXXX
Dividends XXXX
Gains from trade on foreign currencyXXXX
Foreign exchange gainsXXXX
Other financial incomeXXXX
XXXX
29. Financial expenses
2006VND0002005VND000
Interest expenses payable to
Related partiesXXXX
BanksXXXX
OthersXXXX
Loss from disposal of short term investmentsXXXX
Allowance for short-term and long-term investmentsXXXX
Loss from trade on foreign currencyXXXX
Foreign exchange lossesXXXX
XXXX
30. Other income
2006VND0002005VND000
Gains on disposals of tangible fixed assetsXXXX
Gains on disposals of intangible fixed assetsXXXX
Bad debts recoveredXXXX
Compensation received from other partiesXXXX
Income not previously recorded XXXX
XXXX
31. Other expenses
2006VND0002005VND000
Losses on disposals of tangible fixed assetsXXXX
Losses on disposals of intangible fixed assetsXXXX
Compensation paid for breaches of contractsXXXX
Tax penaltiesXXXX
XXXX
32. Corporate income tax
Example 1: Where the Company has incurred a tax loss, has no deferred tax and has not yet triggered the tax holiday period
Reconciliation of effective tax rate
2006
VND0002005
VND000
Loss before tax(XX)(XX)
Tax at CIT rate applicable in Investment Licence(XX)(XX)
Non-deductible expensesXXXX
Tax exempt income(XX)(XX)
(XX)(XX)
Deferred tax asset not recognisedXXXX
XXXX
Deferred tax asset on tax losses has not been recognised as it is not probable that future taxable profits will be available against which the asset can be utilised.(a) Applicable tax rates
Under the terms of its Investment Licence the Company has an obligation to pay the government CIT at the rate of [XX%] of taxable profits for the first [XX] years starting from the first year of operation and [XX%] for the succeeding years. However, the provisions of the Companys Investment Licence allow the Company to be exempt from CIT for [XX] years starting from the first year it generates a taxable profit, and entitled to a [XX%] reduction in CIT for the [XX] succeeding years.
Example 2: Where the Company has no current year tax expense due to the effect of tax holidays
Recognised in the statement of income
2006
VND0002005
VND000
Deferred tax expense/(income)
Origination and reversal of temporary differencesXX(XX)
Reduction in tax rate(XX)(XX)
Benefit of tax losses recognised(XX)(XX)
Write down/(reversal of write down) of deferred tax assetXX(XX)
XX(XX)
Reconciliation of effective tax rate
2006
VND0002005
VND000
[Profit/(loss)] before taxXX(XX)
Tax at CIT rate applicable in investment licenceXX(XX)
Non-deductible expensesXXXX
Tax exempt income(XX)(XX)
Tax losses utilised(XX)-
XX(XX)
Effect of tax holiday(XX)-
XX(XX)
(b) Applicable tax rates
Under the terms of its Investment Licence the Company has an obligation to pay the government CIT at the rate of [XX%] of taxable profits for the first [XX] years starting from the first year of operation and [XX] for the succeeding years. The provisions of the Companys investment licence allow the Company to be exempt from CIT for 2006 and [2007] and receive a [50%] reduction in CIT for the [three] succeeding years [(2008 to 2010)].
Example 3: Where the Company has a current year tax expense
(c) Recognised in the statement of income
2006VND0002005VND000
Current tax expense
Current yearXXXX
Under/(over) provision in prior yearsXX(XX)
XXXX
Deferred tax expense/(income)
Origination and reversal of temporary differencesXX(XX)
Reduction in tax rate(XX)(XX)
Benefit of tax losses recognised(XX)(XX)
Write down/(reversal of write down) of deferred tax assetXX(XX)
XX(XX)
Corporate income tax (CIT)XXXX
[If there is a deferred tax impact from changes in tax rate]The tax rate applicable to deferred taxation has reduced from XX% to XX% due to [state reason].(d) Reconciliation of effective tax rate
2006
VND0002005
VND000
[Profit/(loss)] before taxXX(XX)
Tax at CIT rate applicable in investment licenceXX(XX)
Non-deductible expensesXXXX
Tax exempt income(XX)(XX)
Tax losses utilised(XX)(XX)
Under/(over) provision in prior years(XX)XX
XXXX
(e) Applicable tax rates
Under the terms of its Investment Licence the Company has an obligation to pay the government CIT at the rate of [XX%] of taxable profits for the first [XX] years starting from the first year of operation and [XX%] for the succeeding years. The provisions of the Companys investment licence allow the Company to be exempt from CIT for [2004] and receive a [XX%] reduction in CIT for the [three] succeeding years [(2005 to 2007)].
33. Earnings per share
[This note is only applicable to listed companies or companies going for IPO]
(a) Basic earnings per share
The calculation of basic earnings per share at [31 December 2006] was based on the profit attributable to ordinary shareholders of VNDXX (2005: VNDXX) and a weighted average number of ordinary shares outstanding of XX (2005: XX), calculated as follows:(i) Net profit attributable to ordinary shareholders
20062005
VND000VND000
Net profit for the [period/year]XXXX
Dividend on preference shares(XX)(XX)
Net profit attributable to ordinary shareholdersXXXX
(ii) Weighted average number of ordinary shares
20062005
VND000VND000
Issued ordinary shares at the beginning of the [period/year]XXXX
Effect of own shares held(XX)(XX)
Effect of shares issued in [time of issuance]XXXX
Effect of share reduction in [time of reduction](XX)(XX)
Weighted average number of ordinary shares as at [31 December 2006]XXXX
(b) Diluted earnings per share
The calculation of diluted earnings per share at [31 December 2006] was based on the profit attributable to ordinary shareholders of VNDXX (2005: VNDXX) and a weighted average number of ordinary shares outstanding after adjustment for the effects of all dilutive potential ordinary shares of XX (2005: XX), calculated as follows:
(i) Net profit attributable to ordinary shareholders (diluted)20062005
VND000VND000
Net profit attributable to ordinary shareholders (basic)XXXX
Interest expenses on convertible bonds, net of tax(XX)(XX)
Net profit attributable to ordinary shareholders (diluted)XXXX
(ii) Weighted average number of ordinary shares (diluted)20062005
VND000VND000
Weighted average number of ordinary shares (basic)XXXX
Effect of conversion of convertible bondsXXXX
Effect of shares options on issueXXXX
Weighted average number of ordinary shares (diluted) as at [31 December 2006]XXXX
34. Dividends
Subsequent to the financial year-end a dividend of VND XX has been declared. The amount payable has not been accrued in these financial statements.
35. Significant transactions with related parties
During the [period/year] there were the following significant transactions with related parties:
Related PartyRelationshipNature of transaction2006VND0002005VND000
XXXUltimate holding companyPurchases of fixed assetsXXXX
XXXUltimate holding companyPurchases of materialsXXXX
XXXUltimate holding companyRoyalties payableXXXX
XXXParent companyPurchases of fixed assetsXXXX
XXXParent companyPurchases of materialsXXXX
XXXParent companySales of finished goodsXXXX
XXXRelated companySales of finished goodsXXXX
XXXMember of Board of DirectorsWarehouse rentalsXXXX
36. Commitments
(a) Capital expenditure
As at [31 December 2006] the Company had the following outstanding capital commitments approved but not provided for in the balance sheet:
2006VND0002005VND000
Approved but not contractedXXXX
Approved and contractedXXXX
XXXX
(b) Leases
The future minimum lease payments under non-cancellable operating leases were:
2006VND0002005VND000
Within one yearXXXX
Within two to five yearsXXXX
More than five yearsXXXX
XXXX
37. Foreign exchange contracts
The Company had the following commitments under foreign exchange contracts to purchase USD at [31 December 2006]:
2006VND0002005VND000
Forward foreign exchange contract commitmentsXXXX
38. Contingencies
[Insert discussion of any contingencies including estimated financial impact, uncertainties about its amounts, timing and possible compensations for losses]
39. Production and business costs by element
2006VND0002005VND000
Raw material costs included in production costs
XXXX
Labour costs and staff costs
XXXX
Depreciation and amortisation
XXXX
Outside services
XXXX
Other expenses XXXX
40. Corresponding figures
Case 1: second year reporting, if reclassifications have been made
Certain corresponding figures have been reclassified to conform with the current [period/year]'s presentation as follows:(a) Balance sheet20052005
(Reclassified)(as previously reported)
VND000VND000
Cash and cash equivalentXXXX
Short-term investmentsXXXX
Account receivables- tradeXXXX
Intercompany receivablesXXXX
TradeXXXX
Non tradeXXXX
Deductible value added taxXXXX
Taxes and other receivables from State TreasuryXXXX
Accrued expensesXXXX
Other payablesXXXX
Tax payables to State TreasuryXXXX
Provision for severance allowancesXXXX
ProvisionsXXXX
(b) Statement of incomeFinancial incomeXXXX
Financial expenseXXXX
Selling expenseXXXX
General and administrative expenseXXXX
Case 2: first reporting period
There are no corresponding figures as this is the first set of financial statements prepared by the Company since its incorporation.
Case 3: second year reporting is not corresponding to first reporting period
The prior period corresponding balances are for the period from the Companys date of corporation of [date] to [date].
Prepared by:Approved by:
NameName
Chief AccountantGeneral Director
PAGE \# "'Page: '#''" Page: 1Same as Investment Licence
Based on the Law on Accounting No 03/2003/QH11, the financial statements must be signed by the chief accountant and the legal representative of the company (normally referring the general director).
Can we show this I the notes like we used to?
Allowances and Provisions include Allowances for Inventory, Receivables and Investments and Liability Provisions.
PAGE \# "'Page: '#''" Page: 12Only include unrealised FED on accounts other than unrealised FED on cash and cash equivalents.
Including fixed assets disposal, interest income.
PAGE \# "'Page: '#''" Page: 12Only disclose the increase /(decrease) in payables other than accrued interest, corporate income tax.
PAGE \# "'Page: '#''" Page: 13Only include principal prepayments
PAGE \# "'Page: '#''" Page: 13Only include unrealised FED on cash and cash equivalents (VAS 24 Paragraphs 21 & 31, Page 225)
PAGE \# "'Page: '#''" Only state the current operating activities
Delete if financial instrument hedges are not used by the client.
PAGE \# "'Page: '#''" Page: 18VAS 10 Paragraphs 12b, Page 185
PAGE \# "'Page: '#''" Page: 18Maximum period of 5 years. VAS 10 Paragraphs 12a, Page 185
PAGE \# "'Page: '#''" Page: 19Delete last sentence if not applicable
PAGE \# "'Page: '#''" Page: 20Select one of the two options.
PAGE \# "'Page: '#''" Page: 20Ensure the above assets categories agree with the tangible fixed assets note.
PAGE \# "'Page: '#''" Page: 20Delete if not applicable
PAGE \# "'Page: '#''" Page: 21Only applicable to situations where the company holds a land use right certificate. If the Company does not hold a LUR Certificate then payments should be treated as prepaid land costs under long term prepayments.
The first option when LUR is contributed. Second option when it is purchased.
Delete if not applicable.
Only establishment costs, expenditure on training activities, expenditure on advertising and promotional activities incurred in the pre-operating phase can be either charged to statement of income or deferred and allocated to statement of income over a maximum of three years.
Delete if there no provision for warranty.
PAGE \# "'Page: '#''" Page: 24Delete if not applicable
Only applicable to listed companies or companies going for IPO.
An investment normally qualifies as a cash equivalent only when it has a short maturity of three months or less from the date of acquisition.
Used for goods purchased not for goods sent out for sales
PAGE \# "'Page: '#''" Page: 29Only disclose the amount of borrowing costs capitalised during the period (VAS 16 Paragraph 22b, Page 214)
Describe the property.
VAS 17 requires disclosure of deductible temporary differences and tax losses NOT the amounts of related deferred tax assets.
Disclose the tax losses, not the credit on the tax losses.
To be customised to specific circumstances
To be customised to specific circumstances
PAGE \# "'Page: '#''" Page: 36These examples should be customised for the specific situation.
This example should be customised for the specific situation.
PAGE \# "'Page: '#''" Page: 36Authorised and contributed columns can be combined if authorised capital is fully contributed.
Required by VAS 26-Paragraphs 22 Related party disclosures and Circular 55/2002/TT-BTC dated 26 June 2002.
PAGE \# "'Page: '#''" Raw Material Purchases + Opening RM Closing RM.
PAGE \# "'Page: '#''" Labour costs and staff costs is agreed with salary, related expenses and bonus expenses in Note 32.
PAGE \# "'Page: '#''" Total depreciation and amortisation charge during the year (from Fixed Assets and Long Term Asset Notes). It is also agreed with depreciation and amortisation on Statement of Cash Flows.
PAGE \# "'Page: '#''" Total of charges for electricity, water, telephone, sanitation, transportation, consulting, legal, accounting and auditing, etc for the year.
PAGE \# "'Page: '#''" Page: 48 This note is for the disclosure of individual cost items only. It should not be totalled and/or reconciled with total expenditure or COGS in the P&L.