Operational reporting by valuation enterprises in Vietnam as of July 1, 2024

Operational reporting by valuation enterprises in Vietnam as of July 1, 2024 (Internet image) 

Regarding this matter, LawNet would like to answer as follows: 

On May 16, 2024, the Minister of Finance issued Circular 38/2024/TT-BTC on prescribing assessment of operations of valuation enterprises; establishment of provisions for professional risks, operational reporting by valuation enterprises, and costs associated with valuation operations of valuation councils in Vietnam.

Operational reporting by valuation enterprises in Vietnam

Operational reporting by valuation enterprises is as follows:

- Periodic reports:

+ Within the period from January 01 to March 31 each year, each valuation enterprise shall make a periodic report on its current status and certain valuation criteria using the form in Appendix II enclosed herewith. The report includes data collected from January 01 to December 31 of the year preceding the year in which the report is submitted. Such a report must be submitted by March 31 of the year preceding the year in which the report is submitted.

+ After December 15 each year, each valuation enterprise shall make a periodic report on the list of its valuers using the form in Appendix III enclosed herewith. The report includes data collected until December 15 of the reporting year. Such a report must be submitted by December 20 of the reporting year.

- Periodic reports mentioned in clause 1 of this Article are submitted to the Ministry of Finance of Vietnam (via the Department of Price Management)

+ directly at the correspondence section of the Ministry of Finance of Vietnam;

+ by post;

+ by fax or via the following email: baocaotdg@mof.gov.vn (scanned copies); or

+ via the specialized reporting software system of the Ministry of Finance of Vietnam (if any).

- Ad hoc reports: Valuation enterprises shall submit ad hoc reports on the compliance with regulations of law on valuation by the valuation enterprise and by its valuers

+ at the written request of the Ministry of Finance of Vietnam (via the Department of Price Management); or

+ at the written request of inspection authorities, state audit offices, or authorities competent to initiate proceedings, to serve the consideration of signs of violations involving valuation certificates and/or valuation reports issued or made by the valuation enterprises in accordance with regulations of laws on inspection and state audit, and the criminal procedure code.

- Valuation enterprises assume responsibility for the accuracy and truthfulness of information and data provided in their reports.

(Article 5 of Circular 38/2024/TT-BTC)

 Provisions for professional risks established by valuation enterprises in Vietnam

According to Article 4 of Circular 38/2024/TT-BTC, the provisions for professional risks established by valuation enterprises in Vietnam are as follows:

- Each valuation enterprise that does not purchase professional liability insurance shall be required to establish a provision for professional risks and make an annual contribution equaling 1% of its revenues earned from provision of valuation services (exclusive of VAT) to its provision for professional risks at the end of the fiscal year. This contribution shall be recorded in the same manner as provision for payables.

- If the closing balance on the provision for professional risks of a valuation enterprise exceeds 10% of its last 03 years' average revenue from provision of valuation services (exclusive of VAT), the excess amount shall be reversed and recorded as other incomes of the valuation enterprise.

- Valuation enterprises shall formulate and promulgate their own internal regulations on management and use of provisions for professional risks.

- When an enterprise terminates its provision of valuation services, the unused balance on its provision for professional risks shall be recorded as its other incomes.

Nguyen Ngoc Que Anh

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