Calculation method for depreciation of transport or water infrastructure assets in Vietnam

18:11, 09/11/2018

On August 17, 2018, the Ministry of Finance of Vietnam issued the Circular No. 75/2018/TT-BTC prescribing the regime for management, calculation of depreciation of transport or water infrastructure assets.

According to Circular No. 75/2018/TT-BTC of the Ministry of Finance of Vietnam, the annual depreciation amount of each transport or water infrastructure asset shall be calculated according to the following formula:

The annual depreciation amount of each transport or water infrastructure asset

Historical cost of the transport or water infrastructure asset

Depreciation rate (%/year)

Each year, based on the determination of the increased and decreased depreciation amount in a year, the body authorized to manage transport or water infrastructure assets shall calculate total depreciation of all transport or water infrastructure assets under it management in that year according to the following formula:

Depreciation amount of the transport or water infrastructure asset calculated till the year (n)

Depreciation amount of the transport or water infrastructure asset calculated till the year (n-1)

Depreciation amount of the transport or water infrastructure asset calculated in the year (n)

Depreciation amount of the transport or water infrastructure asset decreased in the year (n)

With respect to a transport or water infrastructure asset of which the historical cost is changed, an entity or enterprise authorized to manage assets shall redetermine indicators of the historical cost, remaining value and accrued depreciation amount of that asset for accounting purposes.

Circular No. 75/2018/TT-BTC of the Ministry of Finance of Vietnam also stipulates that the depreciation amount of the last year of the useful life of a transport or water infrastructure asset shall be defined as the difference between the historical cost and the accrued amount of depreciation already implemented of that asset.

View more details at Circular No. 75/2018/TT-BTC of the Ministry of Finance of Vietnam, effective from October 03, 2018.

-Thao Uyen-

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