Vietnam's Decree 128: Handling of assets and finances when selling 100%wholly state-owned enterprises

Handling of assets and finances when selling 100%wholly state-owned enterprises (Illustration)

Article 10 of the Decree 128/2014/ND-CP stipulates the handling of assets and finances when selling a wholly state-owned enterprise. The handling of assets, cash balances in the Reward and Welfare Fund, unfinished construction costs, provisions, losses or profits is conducted according to the financial handling regulations of the Government in the Decree on converting wholly state-owned enterprises into joint-stock companies. Therefore, the handling of discrepancies in inventoried assets is as follows:

• For excess assets where the cause cannot be determined or the owner cannot be identified, the enterprise should record an increase in the actual value of the state capital corresponding to the actual value of the excess assets;
• For missing assets, the enterprise must clearly identify the cause, responsibilities of the collective and individuals, and require compensation according to legal provisions. The difference between the compensation value of related individuals, collectives, and insurance organizations (if any) and the missing value should be accounted for in business production costs.

Additionally, the Decree also stipulates that based on the Comprehensive Enterprise Arrangement Plan for 100% State-Owned Enterprises approved by the Prime Minister, the competent authority deciding to sell the enterprise must notify the enterprise about the sale and publicly announce it in 01 (one) printed newspaper for 03 (three) consecutive editions and on the business electronic information page of the Ministry of Planning and Investment (www.business.gov.vn), the electronic information page of the Ministry (for single-member limited liability companies under the Ministry), the Provincial People's Committee (for single-member liability companies under the Provincial People's Committee), or the parent company in the economic group, corporation, or company group (for member companies) throughout the selling process.

For detailed information, see Decree 128/2014/ND-CP effective from March 1, 2015.

Ty Na

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