1. Statutory requirements

A newly established company is required to appoint a chief accountant, who meets the qualifications prescribed under the Accounting Law, within the first fiscal year. During this period, a qualified accountant appointed by the FIE shall be responsible over all accounting activities. All Fies operating in Vietnam are required to apply the Vietnamese Accounting Standards and System (VAS) as statutory financial reporting framework. Provided the VAS is applied without modifications, the registration for the use of VAS with the MoF is not required.

Methods of Payment

Most foreign firms exporting to Vietnam conduct business on a documentary basis and use various methods of payment, such as letters of credit (L/Cs), drafts and wire transfers. All foreign businesses dealing with Vietnam should insist on using confirmed, irrevocable L/Cs when initiating relationships with new importers and distributors. Vietnamese companies often will resist the use of confirmed L/Cs, because of the additional cost and collateral requirements required by Vietnamese and international banks.

Through two sets of indicators, Doing Business assesses the legal rights of borrowers and lenders with respect to secured transactions and the sharing of credit information. The depth of credit information index measures rules and practices affecting the coverage, scope and accessibility of credit information available through either a public credit registry or a private credit bureau. Credit information systems mitigate the 'information asymmetry’ in lending and enable lenders to view a borrower’s financial history (positive or negative), providing them with valuable information to consider when assessing risk.

If you want to start up a business in Vietnam, be well advised. Make use of the knowledge and services of Financial Banking.