Circular 177: Supplementing accounting principles and accounting methods for Account 331 in Vietnam

Circular 177: Supplementing accounting principles and accounting methods for Account 331 in Vietnam​ (illustrative image)

Article 15 of Circular 177/2015/TT-BTC supplements the accounting principles and methods for certain major economic transactions of Account 331 - Payable to Sellers:

1. Supplementing Accounting Principles

- Supplementing the content reflecting the payable amount and the payment status of insurance payouts for depositors when organizations participating in the deposit insurance system fall into bankruptcy or lose the ability to pay deposits to depositors according to legal regulations on deposit insurance. This account is used both at the Head Office and Branches.

- Insurance payouts are recognized as liabilities and deducted from the operational reserve fund when there is a decision to pay insurance from the Head Office as per legal regulations.

- In cases where there is no recipient for the insurance payouts, upon the decision of the competent authority, the unit must record an increase in the operational reserve fund and a decrease in the liabilities to depositors.

- The unit must record to the relevant accounts depending on the form of the insurance payout, such as: directly paid by the Head Office or Branch, or authorized through other organizations.

2. Supplementing Accounting Methods for Major Economic Transactions

When there is a decision from the Head Office on insurance payouts for depositors at organizations participating in the deposit insurance that fall into bankruptcy or lose the ability to pay deposits to depositors according to regulations:

- In cases where insurance payouts arise at the Head Office, the accountant records a decrease in the operational reserve fund and an increase in liabilities, recording:

• Debit Account 337 - Operational Reserve Fund
• Credit Account 3311 - Payable for insurance payouts (detailed for each depositor).

- In cases where insurance payouts arise at Branches, the accountant records an increase in receivables from the Head Office and an increase in liabilities for insurance payouts according to the Head Office's notification, recording:

• Debit Account 1364 - Receivables from the Head Office for insurance payouts
• Credit Account 3311 - Payable for insurance payouts (detailed for each depositor).

When the Head Office or Branches pay insurance to depositors, based on the insurance payout documents and related documents, recording:

• Debit Account 3311 - Payable for insurance payouts
• Credit Accounts 111, 112.

In cases where the Head Office and Branches authorize another organization to pay insurance, when the unit advances money to the authorized organization, recording:

• Debit Account 1382 - Receivables from the authorized insurance paying unit
• Credit Accounts 111, 112.

When the unit receives the settlement documents from the authorized organization for the insurance paid, recording:

• Debit Account 3311 - Payable for insurance payouts
• Credit Account 1382 - Receivables from the authorized insurance paying unit.

When the unit collects the unclaimed insurance from the authorized organization, recording:

• Debit Accounts 111, 112
• Credit Account 1382 - Receivables from the authorized insurance paying unit.

In cases where unclaimed insurance is decided for debt cancellation by the competent authority:

- At the Head Office: When there is a decision from the competent authority to supplement the operational reserve fund, recording:

• Debit Account 3311 - Payable for insurance payouts
• Credit Account 337 - Operational Reserve Fund.

- At Branches:

For cases where the money has not yet been received from the Head Office, the accountant records a decrease in receivables from the Head Office for insurance payouts, recording: 

• Debit Account 3311 - Payable for insurance payouts
• Credit Account 1364 - Receivables from the Head Office for insurance payouts.

For cases where the money has been received from the Head Office, if the unclaimed insurance must be returned to the Head Office, recording:

• Debit Account 3311 - Payable for insurance payouts
• Credit Account 3365 - Payable to the Head Office for unclaimed insurance payouts.

For cases where the money has been received from the Head Office, if the unclaimed insurance is allowed to supplement the Branch's operating capital, recording:

• Debit Account 3311 - Payable for insurance payouts
• Credit Account 3361 - Payable to the Head Office for operating capital.

Details can be found at Circular 177/2015/TT-BTC effective from January 1, 2016.

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