In Vietnam: Which authorities shall grant the certificate of eligibility to provide transboundary accounting services for a foreign accounting firm?

In Vietnam: Which authorities shall grant the certificate of eligibility to provide transboundary accounting services for a foreign accounting firm?

Pursuant to Article 30 of the Decree 174/2016/NĐ-CP (amended by Clause 1 Article 2 of the Decree 151/2018/NĐ-CP) stipulating conditions for provision of transboundary accounting services in Vietnam as follows:

1. Foreign accounting firms may provide transboundary accounting services if the following conditions are satisfied:

a) It is permitted to provide accounting services as prescribed by law of the nation where its headquarters are situated (home country);

b) An accounting service authority or accounting association of its home country issues a document certifying that it does not violate regulations on provision of accounting services and other laws over the last 3 years before the submission of the application for the certificate of eligibility to provide transboundary accounting services. (annulled)

c) At least 02 of its employees are granted the Certificate of Accounting Service Registration by the Ministry of Finance, including its legal representative;

d) It has purchased professional liability insurance for its accounting practitioners who work in Vietnam; (annulled)

dd) It does not incur administrative penalties for violations against regulations on provision of transboundary accounting services in Vietnam over the last 12 months before submission of the application for the certificate of eligibility to provide transboundary accounting services in Vietnam. (annulled)

2. A foreign accounting firm may only provide transboundary accounting services in Vietnam if it has been registered and granted the certificate of eligibility to provide transboundary accounting services in Vietnam by the Ministry of Finance of Vietnam. The methods for provision of transboundary accounting services must comply with provisions of Article 31 hereof.

3. A foreign accounting firm must maintain fulfillment of the conditions specified in Clause 1 of this Article throughout the effective period of the certificate of eligibility to provide transboundary accounting services in Vietnam. In the cases where any of such conditions is not fulfilled, the foreign accounting firm must inform the Ministry of Finance within 20 days from such date.

As regulations above, a foreign accounting firm may only provide transboundary accounting services in Vietnam if it has been registered and granted the certificate of eligibility to provide transboundary accounting services in Vietnam by the Ministry of Finance of Vietnam.

Is it permissible for foreign accounting firms to provide transboundary accounting services in Vietnam on themselves?

Pursuant to Article 31 of the Decree 174/2016/NĐ-CP stipulating methods for provision of transboundary accounting services in Vietnam as follows:

1. When providing transboundary accounting services in Vietnam, a foreign accounting firm must form a joint venture with an accounting firm in Vietnam which is qualified for provision of accounting services as prescribed by law.

2. To form a joint venture with a foreign accounting firm to provide transboundary services, the accounting firm in Vietnam must satisfy all conditions for provision of accounting services specified in Article 60 of the Law on Accounting and this Decree and obtain the certificate of eligibility to provide accounting services.

3. The foreign accounting firm and the accounting firm in Vietnam must conclude a joint venture contract for provision of transboundary accounting services. The contract must specify the obligations of each party for provision of transboundary accounting services.

4. When forming such a joint venture to provide transboundary accounting services, the foreign accounting firm and the accounting firm in Vietnam shall conclude an accounting service contract with the client in accordance with Vietnam’s law. The accounting service contract must bear the signatures of the legal representatives of the foreign accounting firm, the accounting firm in Vietnam and the client.

5. The foreign accounting firm and the accounting firm in Vietnam shall appoint an accountant to perform their services specified in the accounting service contract.

6. The accounting service contract, the joint venture contract and accounting service documents must be made in both Vietnamese and English languages.

7. The payment of service charges must be transferred through a credit institution operating under the law on foreign currency management of Vietnam.

As regulations above, when providing transboundary accounting services in Vietnam, a foreign accounting firm must form a joint venture with an accounting firm in Vietnam which is qualified for provision of accounting services as prescribed by law.

What are responsibilities of the foreign accounting firm providing transboundary accounting services in Vietnam?

Pursuant to Article 32 of the Decree 174/2016/NĐ-CP stipulating responsibilities of the foreign accounting firm providing transboundary accounting services in Vietnam as follows:

1. Assign tasks to capable employees to assure service quality. Comply with regulations on prohibited acts and cases of prohibition from accounting service provision specified in Article 25 of this Decree and relevant provisions of the Law on Accounting.

2. Adhere to accounting standards and regulations of Vietnam when providing transboundary accounting services in Vietnam.

3. Pay taxes and fulfill other financial liabilities related to provision of transboundary accounting services in Vietnam as prescribed by Vietnam’s tax laws.

4. Submit biannual reports to the Ministry of Finance on execution of contracts for provision of transboundary accounting services over the last 6 months (using the specimen report provided by the Ministry of Finance).

5. Appoint a person responsible for reporting and providing explanation for Vietnamese authorities regarding accounting service contracts, accounting service documents and other issues relevant to provision of transboundary accounting services in Vietnam.

6. Send the Ministry of Finance an annual financial statement and a report on the foreign accounting firm’s compliance to regulations of law on accounting units and other law issued by the accounting service authority of its home country within 120 days from the end of the fiscal year.

7. Exercise the rights and perform the duties of accounting firms specified in this Decree; comply with provisions of the Law on Accounting and relevant laws of Vietnam.

Above are responsibilities of the foreign accounting firm providing transboundary accounting services in Vietnam.

Best regards!