Method for Determining the Value of State-Owned Enterprises Transformed into Joint Stock Companies

Nguyen Trinh

23:39, 09/07/2024

On October 15, 2019, the Ministry of National Defense issued Circular 155/2019/TT-BQP guiding the transformation of state-owned enterprises and one-member limited liability companies with 100% charter capital invested by state-owned enterprises under the Ministry of National Defense into joint-stock companies.

Determining the value of an enterprise is one of the tasks that must be carried out in the process of privatizing a state-owned enterprise. To be specific, Article 9 of Circular 155/2019/TT-BQP provides guidance for determining the value of an enterprise as follows:

- The determination of an enterprise's value must apply at least two methods, including the asset method.- The consulting organization responsible for determining the value of the enterprise must use the asset method as prescribed in Section 2, Chapter III of Decree 126/2017/ND-CP and specifically guided by Articles 10 and 11 of Circular 41/2018/TT-BTC.- The timing for determining the value of the enterprise based on the chosen methods must be at the end of a quarter or year closest to the time of the privatization decision.

More details can be found in Circular 155/2019/TT-BQP, which takes effect from December 1, 2019.

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