As some specific organizations, some types of companies are required to audit their annual financial statements in accordance with the Law on Auditing. In this article, IFRS Auditing and Consulting Company summarizes the regulations on auditing annual financial statements as follows:

Legal basis for companies to be required to audit financial statements

• Decree No. 17/2012/ND-CP on guiding the implementation of a number of articles of the Law on Independent Audit issued on 13 March 2012;

• Circular 40/2020/TT-BTC on guiding the reporting regime in the field of accounting and independent audit in Decree 174/2016/ND-CP on guiding the Law on Accounting and Decree 17/2012/ND-CP guides the Law on Independent Auditing.

Companies that are required to audit their annual financial statements:

• Foreign-invested enterprises.
• Credit institutions are established and operate under the Law on Credit Institutions, including foreign bank branches in Vietnam.
• Financial institutions, insurance enterprises, reinsurance enterprises, insurance brokerage enterprises, branches of foreign non-life insurance enterprises.
• Public companies, issuers and securities trading organizations.
• Other enterprises and organizations are required to audit in accordance with relevant laws.
• State-owned enterprises, except for state-owned enterprises operating in the fields of state secrets as prescribed by law, must have their annual financial statements audited.
• Enterprises and organizations implementing projects of national importance and group A projects using state capital, except for projects in the field of state secrets as prescribed by law, must be audited for their reports when finalization of the completed project.
• Enterprises and organizations in which state-owned groups or corporations hold 20% or more voting rights at the end of the fiscal year must have their annual financial statements audited.
• Enterprises in which listing organizations, issuers and securities trading organizations hold 20% or more voting rights at the end of the fiscal year must be audited for their annual financial statements.
• Auditing firms and branches of foreign auditing firms in Vietnam must have their annual financial statements audited.

Notes on audited financial statements:

• Enterprises and organizations that are required to audit annual financial statements specified in Clauses 1 and 2, Article 15 of Decree No. 17/2012/ND-CP if required by law to prepare financial statements consolidated financial statements or consolidated financial statements, the consolidated financial statements or the consolidated financial statements must be audited.
• The audit of financial statements and project settlement reports for enterprises and organizations specified at Points a and b, Clause 2, Article 15 of Decree No. 17/2012/ND-CP does not replace audit by the Auditor of State.
• Enterprises and other organizations voluntarily request an audit.

Entities eligible to audit annual financial statements

Audit firm in Vietnam: An enterprise established and operating in accordance with Vietnamese law, fully meeting the conditions for providing audit services as prescribed, and having been granted a certificate by the Ministry of Finance of Vietnam fully qualified for the auditing services. Consists of:

• Foreign auditing firms in Vietnam;
• Branches of foreign auditing firms in Vietnam;
• Vietnam capital audit companies are established in accordance with the law.

The clients would like to audit financial statements, please contact us for specific advice and guidance!

IFRS Auditing and Consulting Company Limited
The company provides a wide range of services such as audit of financial statements, tax advice, accounting services and valuation services with leading experts working in large auditing firms, multinational corporations