Circular No. 125/2011/TT-BTC guiding accounting for Fund Management Companies

CIRCULAR

Guidelines for accounting applicable to Fund Management Companies

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Pursuant to the Accounting Law No. 03/2003/QH11 dated June 17, 2003;

Pursuant to the Securities Law No. 70/2006/QH11 dated June 29, 2006;

Pursuant to the Amended and Supplementary Securities Law No. 62/2010/QH12 dated November 24, 2010;

Pursuant to the Decree No. 118/2008/NĐ-CP dated November 27, 2008 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

Pursuant to Decree No. 129/2004/NĐ-CP dated May 31, 2004 of the Government detailing and guiding the implementation of certain provisions of the Accounting Law applicable in business operations;

The Ministry of Finance hereby provides guidelines for accounting applicable to Fund Management Companies as follows:

Article 1. Scope of Regulation and Applicability

1. This Circular stipulates certain accounts, financial statement models, methods of preparing and presenting financial statements applicable to Fund Management Companies operating under the Charter on the organization and operation of Fund Management Companies prescribed by the Ministry of Finance;

2. For accounting matters not covered in this Circular, Fund Management Companies shall implement according to the Accounting Law, guiding documents of the Accounting Law, the Accounting System for Enterprises issued pursuant to Decision No. 15/2006/QĐ-BTC dated March 20, 2006 of the Minister of Finance (hereinafter referred to as Decision No. 15/2006/QĐ-BTC) and Circulars guiding the implementation of accounting standards, Circulars amending and supplementing the Accounting System for Enterprises.

Article 3. Organization of accounting work

Fund Management Companies must organize accounting work to ensure separation and clarity regarding assets, sources of capital, transactions of the Company with assets and sources of capital of investors whose investment portfolios are managed by the Company, with Investment Funds (hereinafter referred to as Investment Funds), and Securities Companies (hereinafter referred to as Securities Companies) directly managed by the Company.

Article 3. Amend and supplement certain accounting accounts

1. Change the name and add second-level accounting accounts of first-level accounts already promulgated in the Accounting System for Enterprises issued together with Decision No. 15/2006/QĐ-BTC.

1.1. Change the name of Account 511 - "Revenue from sales and provision of services" to "Revenue from business activities and other service revenues".

Account 511 has five second-level accounts:

- Account 5111 - Revenue from fund management activities and securities company management;

- Account 5112 - Revenue from portfolio management activities;

- Account 5113 - Revenue from performance fee activities;

- Account 5114 - Revenue from securities investment advisory activities;

- Account 5118 - Other Revenue.

1.2. Change the name of Account 532 - "Sales discount" to "Revenue deductions".

1.3. Change the name of Account 631 - "Production cost" to "Business activity expenses".

Account 631 has four second-level accounts:

- Account 6311 - Expenses for fund management activities and securities company management;

- Account 6312 - Expenses for portfolio management activities;

- Account 6314 - Expenses for securities investment advisory activities;

- Account 6318 - Other business activity expenses.

1.4. Change the name of Account 002 - "Materials, goods received for storage, processing" to "Materials, valuable certificates received for storage".

1.5. Change the name of Account 003 - "Goods received for sale, consignment, pledge" to "Pledged assets".

2. Add three first-level accounts in the Balance Sheet and six accounts outside the Balance Sheet compared to the Accounting System for Enterprises issued together with Decision No. 15/2006/QĐ-BTC and Circulars guiding amendments and supplements to the Accounting System for Enterprises.

2.1. Account 132 - Receivables from business activities

Account 132 has five second-level accounts:

- Account 1321 - Receivables from fund management activities and securities company management;

- Account 1322 - Receivables from portfolio management activities;

- Account 1323 - Receivables from performance fee activities;

- Account 1324 - Receivables from securities investment advisory activities;

- Account 1328 - Receivables from other business activities.

2.2. Account 359 - Reserve for investor loss compensation.

2.3. Account 637 - Direct common expenses

Account 637 has five second-level accounts:

- Account 6371 - Direct employee expenses;

- Account 6372 - Material and equipment expenses;

- Account 6373 - Depreciation expenses;

- Account 6374 - Professional liability insurance expenses;

- Account 6378 - Other cash expenses.

2.4. Account 012 - Securities held in custody by Fund Management Companies.

2.5. Account 015 - Unregistered securities of Fund Management Companies.

2.6. Account 021 - Investor entrusted deposits.

2.7. Account 022 - Investor entrusted investment portfolios.

2.8. Account 023 - Receivables from investor entrusted parties.

2.9. Account 024 - Payables to investor entrusted parties.

3. Do not use the following accounting accounts:

- Account 151 - Purchased goods in transit;

- Account 154 - Work-in-Progress Production and Operating Costs;

- Account 155 - Finished Products;

- Account 156 - Goods;

- Account 157 - Goods Sent for Sale;

- Account 158 - Taxed Inventory;

- Account 159 - Provision for inventory write-down;

- Account 161 - Public Welfare Expenditure;

- Account 217 - Investment Real Estate;

- Account 315 - Long-term debt due;

- Account 337 - Advance Payment for Construction Contract;

- Account 417 - Enterprise Restructuring Support Fund;

- Account 441 - Investment capital for construction;

- Account 461 - Public Welfare Revenue;

- Account 466 - Capitalized Public Welfare Revenue;

- Account 512 - Internal Sales Revenue;

- Account 521 - Trade Discounts;

- Account 531 - Returned goods sold;

- Account 611 - Purchases;

- Account 621 - Direct Material and Consumable Costs;

- Account 622 - Direct Labor Costs;

- Account 623 - Machinery Usage Costs;

- Account 627 - Common Production Costs;

- Account 641 - Selling expenses;

- Account 008 - Public Welfare and Project Budget.

(List of the Accounting System applicable to Fund Management Companies after amendment and supplementation as set out in Appendix No. 01 issued together with this Circular).

Article 4. Accounting for Receivables from Business Operations

Supplement Account 132 - Receivables from Business Operations

This account is used to reflect debts receivable and the settlement status of such debts receivable of the Fund Management Company with Investment Funds, Securities Companies, and investors of the Fund regarding management activity fees, securities portfolio management fees, bonus fees, advisory service fees for securities investment activities, other income from operations... This account is also used to reflect receivables concerning expenses paid on behalf of Investment Funds and Securities Companies by the Fund Management Company.

1. Principles of accounting entries for this account

- Debts receivable must be recorded in detail for each debtor, for each type of receivable, and recorded according to each payment transaction. Debtors are Investment Funds, Securities Companies, or economic entities related to the Fund Management Company that have not yet paid for services received regarding fund management, securities portfolio management, and acceptance of payments.

- Immediate cash collection services (cash, check, or bank collections) shall not be reflected in this account.

- In detailed accounting entries for this account, the accountant must classify debts into payable within due date, difficult-to-collect, or unrecoverable debts to determine the amount of provision for doubtful receivables or take measures against uncollectible receivables.

2. Structure and content reflected in Account 132 - Receivables from Business Operations

Debit Side:

- Amounts receivable from Investment Funds and Securities Companies for management fees;

- Amounts receivable from investors for unpaid securities portfolio management fees;

- Amounts receivable for bonus fees and advisory service fees for securities investment activities;

- Clauses regarding fees for performance rewards, fees for advisory services on securities investment activities;

- Excess amounts refunded to customers;

- Amounts receivable for expenses paid on behalf of Investment Funds and Securities Companies.

Credit Side:

- Amounts paid by Investment Funds and Securities Companies;

- Amounts paid by investors.

Debit Balance:

Remaining amounts receivable from customers.

Account 132 - Receivables from Business Operations has five second-level accounts:

- Account 1321 - Receivables from Fund Management Activities and Securities Company Management: Reflects receivables from the Fund Management Company for management fees owed by Investment Funds and Securities Companies.

- Account 1322 - Receivables from Securities Portfolio Management Activities: Reflects receivables from the Fund Management Company for providing securities portfolio management services to investors.

- Account 1323 - Receivables from Bonus Fees: Reflects receivables from bonus fees earned by the Fund Management Company when the investment results of the fund or portfolio exceed the reference rate approved by investors.

- Account 1324 - Receivables from Securities Investment Advisory Fees: Reflects receivables from the Fund Management Company for advisory service fees for securities investment activities.

- Account 1328 - Receivables from Other Business Operations: Reflects receivables from the Fund Management Company for other business operations not covered by Accounts 1321, 1322, 1323, and 1324.

3. Accounting Methods for Some Main Economic Transactions

3.1. Determining the amount receivable from Investment Funds and Securities Companies for management fees, securities portfolio management fees, and securities investment advisory fees, the accountant records:

Debit Account 132 - Receivables from Business Operations (1321, 1322, 1324)

Credit Account 511 - Revenue from Business Operations and Provision of Services

(5111,5112, 5114)

- When actually collecting money from investment securities funds or investors, record:

Debit Accounts 111, 112

Credit Account 132 - Receivables from Business Operations (1321, 1322, 1324).

3.2. When receiving notifications about reward amounts given by investors to the Fund Management Company, the accountant shall record based on relevant documents:

Debit Account 132 - Receivables from Business Operations (1323)

Credit Account 511 - Revenue from Business Operations and Provision of Services.

3.3. When expenses occur that the Fund Management Company has paid on behalf of Investment Funds and Securities Companies, whose responsibility to pay belongs to Investment Funds, such as transaction costs, negotiations, signing purchase and sale contracts for securities for investment funds, based on relevant documents, record:

Debit Account 132 - Receivables from Business Operations (1328)

Credit Accounts 111, 112.

3.4. When recovering amounts paid on behalf of Investment Funds and Securities Companies, the accountant records:

Debit Account 112 - Bank Deposits

Credit Account 132 - Receivables from Business Operations (1328).

3.5. If there are truly uncollectible debts that cannot be recovered, they must be written off. Based on the decision document for writing off the debt, record:

Debit Account 139 - Provision for Doubtful Receivables (if a provision has been made)

Debit Account 642 - Administrative Expenses (if no provision has been made)

Credit Account 132 - Receivables from Business Operations.

At the same time, record on the debit side of Account 004 - Written-off Bad Debts (an account outside the Balance Sheet) to continue monitoring within the specified period to potentially recover the debt from the debtor.

- When recovering written-off bad debts, record:

Debit Accounts 111, 112

Credit account 711 - Other income.

Simultaneously credit Account 004 - Written-off Bad Debts (an account outside the Balance Sheet).

Article 5. Accounting for the Reserve Fund for Investor Damage Compensation

Supplement Account 359 - Reserve Fund for Investor Damage Compensation.

This account is used to reflect the existing amount and the situation of establishing and using the damage compensation reserve fund for investors as stipulated by the financial mechanism.

Account 359 - Reserve Fund for Investor Damage Compensation can only be used when the financial mechanism permits fund management companies to establish damage compensation reserves for investors.

The damage compensation reserve for investors is established annually and included in the management costs to compensate for losses suffered by investors due to technical incidents and negligence of fund managers during their operations. If the reserve is not fully utilized in a fiscal year, it may be carried over to the next year for continued use.

In principle, at the end of each fiscal year when closing the accounting books, the fund management company must establish the reserve fund for investor damage compensation according to current laws.

1. Structure and Content Reflected in Account 359 - Reserve Fund for Investor Damage Compensation

Debit Side:

The reduction in the damage compensation reserve for investors due to compensation payments to investors.

Credit Side:

The increase in the damage compensation reserve for investors due to annual establishment.

Debit balance:

The existing balance of the damage compensation reserve for investors at the end of the period.

2. Accounting Methods for Some Main Economic Transactions

- When temporarily establishing the damage compensation reserve for investors based on transaction volume and the reserve establishment system under the financial mechanism, the fund management company establishes the damage compensation reserve fund for investors, recording:

Debit Account 642 - Business Management Expenses (6426)

Credit Account 359 - Reserve Fund for Investor Damage Compensation.

- At the end of the accounting period, based on the transaction volume of the accounting period, the reserve establishment system under the regulations, and the balance of the damage compensation reserve for members, the accountant calculates and determines the amount of the reserve to be established for investor damage compensation, recording:

Debit Account 642 - Business Management Expenses (6426)

Credit Account 359 - Reserve Fund for Investor Damage Compensation.

- When damage compensation claims arise for investors, based on the authorized compensation decision, the compensation file, and payment vouchers, record:

Debit Account 359 - Reserve Fund for Investor Damage Compensation

Credit Accounts 111, 112.

Article 6. Accounting for Business Operation Revenue and Other Service Provision Revenue

Rename Account 511 - "Revenue from Sales and Service Provision" to "Revenue from Business Operations and Other Service Provision"

This account is used to reflect revenue generated during the period from fund management activities, securities company management activities, investment portfolio management activities, securities investment advisory fees, bonus fees from fund management companies and securities companies, and other revenues.

1. Principles of accounting entries for this account

1.1. Only record into Account 511 - "Revenue from Business Operations and Other Service Provision" the revenue from fund management fees, securities company management fees, investment portfolio management fees, securities investment advisory fees, bonus fees, and other revenues collected during the period regardless of whether the money has been received or will be received.

1.2. Revenue is determined as follows:

- Revenue from fund management activities and securities company management activities: This is the fee revenue that the fund management company receives from managing funds and securities companies.

- Revenue from investment portfolio management activities: This is the fee revenue that the fund management company receives from managing investment portfolios for entrusted investors.

- Revenue from bonus fees: This is the bonus revenue that the fund management company receives when the net asset value growth rate of the fund exceeds a reference rate agreed upon by the investor.

- Revenue from securities investment advisory activities: This is the fee revenue that the fund management company receives from providing securities investment advisory services to clients.

- Other revenue.

1.3. Do not record into this account the following cases:

- Proceeds from the sale and liquidation of fixed assets.

- Proceeds from loss compensation and insured assets.

- Collection of previously written-off receivables and other income.

1.4. The accountant must maintain subsidiary ledgers to track the revenue of the fund management company.

2. Structure and Content Reflected in Account 511 - Revenue from Business Operations and Other Service Provision

Debit Side:

- Reflect reductions in business operation revenue.

- Transfer the net business operation revenue and service provision revenue to Account 911 - "Determine Operating Results".

Credit Side:

- Revenue from fund management activity fees and securities company management fees.

- Revenue from investment portfolio management fees.

- Revenue from bonus fees.

- Revenue from securities investment advisory fees.

- Other revenue.

This account does not have a balance at the end of the period.

Account 511 - Revenue from Business Operations and Other Service Provision includes five second-level accounts:

- Account 5111 - Revenue from Fund Management Activities and Securities Company Management Activities: This account is used to reflect revenue from collecting management fees for fund management activities and securities company management activities.

- Account 5112 - Revenue from Investment Portfolio Management Activities: This account is used to reflect revenue from managing investment portfolios for entrusted investors.

- Account 5113 - Revenue from Bonus Fees: This account is used to reflect revenue from bonus fees that the fund management company receives when investment results exceed the reference rate agreed upon by the investor.

- Account 5114 - Revenue from Securities Investment Advisory Activities This account is used to reflect revenue from providing securities investment advisory services, financial advisory services, and other advisory services to clients.

- Account 5118 - Other Revenue: This account is used to reflect other revenues not included in Accounts 5111, 5112, 5113, and 5114.

3. Accounting Methods for Some Main Economic Transactions

3.1. When revenue from managing the Securities Investment Fund, Securities Investment Company, consulting fees for securities investment, financial advisory services... is generated, based on the fee invoice and related documents, accounting entries shall be recorded as follows:

Debit accounts 111, 112, 132...

Credit account 511 - Revenue from business operations and other service provision

(5111, 5114).

3.2. When revenue from managing the securities investment portfolio for entrusted investors according to the agreement in the entrustment investment contract is determined, the accounting entry shall be recorded as follows:

Debit accounts 111, 112, 132,...

Credit Account 511 - Revenue from Business Operations and Provision of Services

(5112).

3.3. When receiving money or notifications about bonuses awarded by securities investment funds to the Fund Management Company, based on relevant documents, the accounting entry shall be recorded as follows:

Debit accounts 111, 112, 132,...

Credit Account 511 - Revenue from Business Operations and Provision of Services

(5113).

3.4. In cases where tax policies stipulate that revenues reflected in points 3.1, 3.2, and 3.3 above are subject to VAT, the Fund Management Company must supplement accounting entries reflecting the amount of VAT payable.

3.5. At the end of the period, accounting entries transferring the reduction in revenue (if any) to business operation revenue shall be recorded as follows:

Debit account 511 - Revenue from business operations and other service provision

Credit account 532 - Reductions in revenue

3.6. At the end of the period, accounting entries transferring the net revenue from business operations and other service provision to account 911 - Determining business results shall be recorded as follows:

Debit account 511 - Revenue from business operations and other service provision

Credit account 911 - Determining business results.

Article 7. Accounting for business operation expenses

Rename Account 631 - "Production Cost" to "Business Operation Expenses".

This account is used to reflect expenses related to business operations during the accounting period of the Fund Management Company.

Business operation expenses of the Fund Management Company include: expenses for managing the Securities Investment Fund, managing the Securities Investment Company, expenses for managing the securities investment portfolio, expenses for consulting activities, and other business operation expenses,...

1. Principles of accounting for this account

- Only record actual expenses incurred (paid or to be paid) directly related to the business operations of the Fund Management Company during the accounting period for which the company is responsible for payment, including: expenses for managing the Securities Investment Fund, managing the Securities Investment Company, expenses for managing the securities investment portfolio, expenses for securities investment consulting activities, and other business operation expenses for which the Fund Management Company is responsible for payment.

- Do not record management expenses of the Fund Management Company in this account.

2. Structure and content reflected in Account 631 - Business Operation Expenses

Debit Side:

Reflect expenses directly related to the business operations of the Fund Management Company or other expenses of business operations for which the Fund Management Company is responsible for payment.

Credit Side:

Transfer business operation expenses incurred during the period to the debit side of Account 911 - Determining business results.

Account 631 does not have a closing balance.

Account 631 - Business Operation Expenses has four second-level accounts:

- Account 6311 - Expenses for managing the Securities Investment Fund and Securities Investment Company: Reflect expenses that the Fund Management Company must pay for managing the Securities Investment Fund and Securities Investment Company.

- Account 6312 - Expenses for managing the securities investment portfolio: Reflect expenses incurred to serve the management of the securities investment portfolio for entrusted investors during the period for which the company is responsible for payment.

- Account 6314 - Expenses for securities investment consulting activities: Reflect expenses for securities investment consulting activities of the Fund Management Company.

- Account 6318 - Other business operation expenses: Reflect expenses directly related to business operations that have not been reflected in Accounts 6311, 6312, and 6314.

3. Accounting Methods for Some Main Economic Transactions

- When expenses related to business operations of the Fund Management Company such as expenses for managing the Securities Investment Fund, Securities Investment Company, transaction expenses for which the Fund Management Company is responsible for payment, expenses for managing the securities investment portfolio, and expenses for securities investment consulting activities occur, the accounting entry shall be recorded as follows:

Debit Account 631 - Business Operation Expenses (6311, 6312, 6314)

Debit Account 133 - VAT Deductible Tax (if deductible)

Credit accounts 111, 112, 152, 153, 331, 335,...

- When other business operation expenses occur, based on relevant documents, the accounting entry shall be recorded as follows:

Debit Account 631 - Business Operation Expenses (6318)

Credit accounts 111, 112

- At the end of the period, accounting entries for allocating and transferring direct common expenses shall be recorded as follows:

Debit Account 631 - Business Operation Expenses (6311, 6312, 6314, 6318)

Credit Account 637 - Direct Common Expenses

- At the end of the period, accounting entries transferring business operation expenses to the debit side of Account 911 - "Determining business results" shall be recorded as follows:

Debit account 911 - Determining business results

Credit Account 631 - Business Operation Expenses.

Article 8. Direct General Expenses Accounting

Supplement Account 637 - Direct General Expenses

This account is used to reflect direct general expenses serving the company's business operations, including: direct employee costs, material and equipment costs, depreciation expenses on fixed assets, professional liability insurance costs, and other monetary expenses.

At the end of the accounting period, the company must calculate and allocate the transfer of direct general expenses to the Debit side of Account 631 - "Business Operation Costs" according to appropriate and consistent criteria across accounting periods.

1. Structure and Content Reflected in Account 637 - Direct General Expenses

Debit Side:

Direct general expenses incurred during the period.

Credit Side:

- Reductions in direct general expenses;

- Transfer of direct general expenses to the Debit side of Account 631.

Account 637 does not have an ending balance.

Account 637 - Direct General Expenses has 5 sub-accounts:

- Sub-account 6371 - Direct Employee Costs: Reflects costs related to employees directly involved in the company's common business activities that are not separately reflected for each activity such as salary, social insurance, ...

- Sub-account 6372 - Material and Equipment Costs: Reflects office supply costs directly used for business activities during the period.

- Sub-account 6373 - Depreciation Costs on Fixed Assets: Reflects depreciation costs on fixed assets directly used for business activities during the period that have not been reflected in Account 631.

- Sub-account 6374 - Professional Liability Insurance Costs: Reflects amounts spent on purchasing professional liability insurance for fund management personnel at the Company, which must be included in the current period's costs according to financial mechanism regulations. This account can only be used when the financial mechanism allows the fund management company to purchase professional liability insurance.

- Sub-account 6378 - Other Monetary Costs: Reflects other monetary costs directly related to business activities during the period.

2. Accounting Methods for Some Main Economic Transactions

- Direct employee costs payable during the period:

Wages, salaries payable, allowances and bonuses, recorded:

Debit Account 637 - Direct General Expenses (6371)

Credit Account 334 - Payable to Employees (3341, 3342).

Deduct social insurance, health insurance, housing provident fund, unemployment insurance according to current regulations, recorded:

Debit Account 334 - Payable to Employees (3341, 3342) (Portion deducted from wages)

Debit Account 637 - Direct General Expenses (6371) (Portion included in costs)

Credit Account 338 - Other Payables and Receivables (3382, 3383, 3384, 3389).

- Office supply costs for direct fund management activities, securities company management, and portfolio management, recorded:

Debit Account 637 - Direct General Expenses (6372)

Debit Account 133 - Deductible VAT (if applicable)

Credit Accounts 111, 112, 152, 331.

- Tool and equipment costs for direct fund management activities, securities company management, and portfolio management, recorded:

Debit Account 637 - Direct General Expenses (6372)

Debit Account 133 - Deductible VAT (if applicable)

Credit Accounts 111, 112, 153, 331.

- Depreciation costs on fixed assets for direct fund management activities, securities company management, and portfolio management, and depreciation costs on leased fixed assets, recorded:

Debit Account 637 - Direct General Expenses (6373)

Credit Account 214 - Depreciation of Fixed Assets (2141, 2142, 2143).

- Service costs purchased externally for direct fund management activities, securities company management, and portfolio management, recorded:

Debit Account 637 - Direct General Expenses (6378)

Debit Account 133 - Deductible VAT (if applicable)

Credit accounts 111, 112, 331.

- Monetary expenditures for direct fund management activities, securities company management, and portfolio management, recorded:

Debit Account 637 - Direct General Expenses (6378)

Debit Account 133 - Deductible VAT (if applicable)

Credit Accounts 111, 112.

When paying for annual professional liability insurance according to financial mechanism regulations, recorded:

Debit Account 637 - Direct General Expenses (6374)

Debit Account 133 - Deductible VAT (if applicable)

Credit Accounts 111, 112.

- At the end of the accounting period, transfer direct general expenses to the Debit side of Account 631 - Business Operation Costs, recorded:

Debit Account 631 - Business Operation Costs

Credit Account 637 - Direct General Expenses.

Article 9. Accounting for Accounts Outside the Balance Sheet

1. Supplement Account 012 - Securities Deposited by Fund Management Companies

This account is used to reflect the quantity and face value of various types of traded securities, temporarily suspended trading securities, pledged securities, held securities, securities awaiting settlement, frozen securities awaiting withdrawal, securities awaiting trading, and securities pledged as collateral for loans of fund management companies.

1.1. Structure and Content Reflected in Account 012 - Securities Deposited by Fund Management Companies

Debit Side:

Increase the quantity and face value of deposited securities owned by the fund management company listed with the Securities Depository Center (hereinafter referred to as the Securities Depository Center).

Credit Side:

Decrease the quantity and face value of deposited securities owned by the fund management company listed with the Securities Depository Center.

Debit Balance:

The quantity and face value of deposited securities owned by the fund management company currently listed with the Securities Depository Center.

Account 012 - Securities Deposited by Fund Management Companies has 9 sub-accounts, including:

- Sub-account 0121 - Traded Securities: This account reflects the face value of securities that meet the conditions to participate in trading on the securities market;

­- Sub-account 0122 - Temporarily Suspended Trading Securities: This account reflects the face value of securities that are temporarily suspended from trading;

_­- Sub-account 0123 - Pledged Securities: This account reflects the face value of securities being used as collateral for other activities of the entity whose securities are listed with the Securities Depository Center;

- Sub-account 0124 - Held Securities: This account reflects the face value of securities that are temporarily held due to civil violations, payment issues, etc., and cannot be traded on the securities market of depositary members;

­- Sub-account 0125 - Securities Awaiting Settlement: This account reflects the face value of securities that have been matched for purchase and sale transactions and are awaiting settlement;

- Sub-account 0126 - Frozen Securities Awaiting Withdrawal: This account reflects the face value of securities that are frozen and awaiting withdrawal from listing with the Securities Depository Center;

- Sub-account 0127 - Securities Awaiting Trading: This account reflects the par value of securities currently in the period awaiting completion of transaction procedures to be traded on the securities market.

- Account 0128 - Pledged Securities for Loan Guarantees: This account reflects the par value of securities of the Fund Management Company that are currently pledged as guarantees for loans.

- Account 0129 - Securities for Transaction Error Correction: This account reflects the par value of securities currently undergoing error correction following transactions such as account discrepancies, incorrect securities, mistaken purchase orders, etc.

1.2. Accounting methods for some major economic transactions

1.2.1 Securities custody accounting includes the following contents:

a. Custody of securities after primary market activities

Upon receiving the results of transactions and securities custody from the Securities Depository Center related to the outcomes of securities trading activities to detail the securities custody of the Fund Management Company, the accountant records:

Debit Accounts 121, 228

Credit Accounts 111, 112

Simultaneously, outside the Balance Sheet, record single entry:

Debit Account 012 - Securities custody of the Fund Management Company

b. Custody of securities after secondary market activities

Upon receiving the results of transactions from the Securities Depository Center related to the outcomes of buying and selling securities of the Fund Management Company on the securities trading market, the accounting is as follows:

- When purchasing securities, record:

Debit Accounts 121, 228

Credit accounts 111, 112

Simultaneously, outside the Balance Sheet, record single entry:

Debit Account 012 - Securities custody of the Fund Management Company (0121).

- When selling securities:

Debit Accounts 111, 112 (Sale Price)

Debit Account 635 - Financial Expenses (Loss Amount)

Credit Accounts 121, 228 (Cost Price)

Credit Account 515 - Revenue from Financial Activities (Profit Amount).

Simultaneously, outside the Balance Sheet, record single entry:

Credit Account 012 - Securities custody of the Fund Management Company (0121).

1.2.2 Accounting for securities temporarily suspended from trading, pledged, held in suspense, awaiting settlement, or frozen pending withdrawal:

Based on the notification from the Securities Depository Center regarding the temporary suspension of trading, pledging, holding in suspense, record:

Debit Accounts 0122, 0123, 0124

Simultaneously, record single entry:

Credit Account 0121 - Trading Securities.

Based on the notification from the Securities Depository Center regarding the termination of the suspension of trading, termination of pledging, or termination of holding in suspense, record:

Debit Account 0121 - Trading Securities.

Simultaneously, record single entry:

Credit Accounts 0122, 0123, 0124.

Based on the notification from the Securities Depository Center regarding securities that have been matched with buyers and sellers through bidding at the Stock Exchange but are still awaiting settlement, record:

Debit Account 0125 - Securities Awaiting Settlement.

Credit Account 0121 - Trading Securities.

Based on the notification from the Securities Depository Center regarding securities currently in the period of being frozen pending withdrawal, record:

Debit Account 0126 - Securities Frozen Pending Withdrawal.

Credit Accounts 0121, 0122, 0123, 0124.

Based on the notification from the Securities Depository Center regarding the lifting of the freeze, record:

Debit Accounts 0121, 0122, 0123,...

Credit Account 0126 - Securities Frozen Pending Withdrawal.

2. Supplement Account 015 - Unregistered Securities of the Fund Management Company

This account is used to reflect the quantity and value (par value) of various types of unregistered securities certificates (stocks, bonds, other securities) of the Fund Management Company.

2.1. Structure and content reflected in Account 015 - Unregistered Securities of the Fund Management Company

Debit Side:

The quantity and value of various types of securities certificates purchased by the Fund Management Company on the market without completing registration procedures.

Credit Side:

The quantity and value of securities sent by the Fund Management Company for registration at the Securities Depository Center.

Debit Balance:

The quantity and value of unregistered securities certificates currently held by the Fund Management Company.

2.2. Accounting methods for some major economic transactions

- When the Fund Management Company purchases individual securities or fund certificates, record:

Debit Accounts 121, 228

Credit Account 111 - Cash (1111, 1112), or

Credit Account 112 - Bank Deposits.

Simultaneously, increase the unregistered securities of the Fund Management Company (outside the Balance Sheet):

Debit Account 015 - Unregistered Securities of the Fund Management Company.

- When performing securities registration procedures at the Securities Depository Center for individually purchased securities or fund certificates:

When transferring unregistered securities of the Fund Management Company for registration at the Securities Depository Center, record single entry:

Credit Account 015 - Unregistered Securities of the Fund Management Company.

Upon receiving the notification from the Securities Depository Center about the registered securities of the Fund Management Company for individually purchased securities registered at the Securities Depository Center, record single entry Debit Account 012 - Securities custody of the Fund Management Company (0121).

3. Supplement Account 021 - Entrusted Investor Deposits

This account is used to reflect the current amount and fluctuations in entrusted investor deposits held at the payment bank based on the investment entrustment contract signed between the entrusted investor and the Fund Management Company for the Fund Management Company to invest on behalf of the entrusted investor.

3.1. Structure and content reflected in Account 021 - Entrusted Investor Deposits

Debit Side:

- The amount of money entrusted investors deposit into their deposit accounts at the payment bank

- Interest received from investments.

Credit Side:

- Decrease in entrusted investor deposits due to:

+ Transferring funds to purchase securities;

+ Transferring funds to purchase other financial investments;

+ Paying taxes on behalf of entrusted investors (if applicable).

- Paying interest to entrusted investors.

Debit Balance:

The balance of the entrusted investor's account at the end of the period.

Account 021 - Entrusted Investor Deposits has two sub-accounts:

- Account 0211 - Domestic Entrusted Investor Deposits: This account reflects the current amount and fluctuations in domestic entrusted investor deposits held at the payment bank.

- Account 0212 - Foreign Entrusted Investor Deposits: This account reflects the current amount and fluctuations in foreign entrusted investor deposits held at the payment bank.

3.2. Methods of Accounting for Some Main Economic Transactions

When the entrusted investor transfers funds into the entrusted investment deposit account at the payment bank according to the terms of the entrusted management contract, based on the bank's credit notice, the Fund Management Company records single entry on the debit side of Account 021 - Entrusted Investor Deposits (0211, 0212) (outside the Balance Sheet).

When receiving investment interest from entrusted investors in cash, record single entry on the debit side of Account 021 - Entrusted Investor Deposits.

- When purchasing entrusted investment securities:

Debit Account 022 - Investment Portfolio of Entrusted Investors (Record at the actual investment value)

Credit Account 021 - Deposits of Entrusted Investors (Record the actual amount to be paid out)

- When selling entrusted investment securities

Debit Account 021 - Deposits of Entrusted Investors (Record the actual amount received)

Credit Account 022 - Investment Portfolio of Entrusted Investors (Record at the actual sale value)

- When paying taxes or other amounts on behalf of entrusted investors (if applicable), credit Account 021 - Deposits of Entrusted Investors.

- When paying interest earned from entrusted investment assets or returning the initial investment capital of entrusted investors upon termination of the entrusted management contract, credit Account 021 - Deposits of Entrusted Investors.

4. Supplement Account 022 - Investment Portfolio of Entrusted Investors

This account is used to reflect changes in quantity and value of investments made by entrusted investors managed by the Fund Management Company pursuant to contracts signed with entrusted investors for portfolio management services.

4.1. Structure and Content Reflected in Account 022 - Investment Portfolio of Entrusted Investors

Debit Side:

Quantity and value of securities, certificates, and other investment items purchased under the entrusted portfolio management contract.

Credit Side:

Quantity and value of securities, certificates, and other investment items sold under the entrusted portfolio management contract.

Debit Balance:

Quantity and value of securities in various portfolios currently managed by the Fund Management Company for entrusted investors at the end of the period.

Account 022 - Investment Portfolio of Entrusted Investors has two sub-accounts:

- Sub-account 0221 - Domestic Entrusted Investors: This account reflects the current balance and changes in quantity and value of the investment portfolio of domestic entrusted investors.

Sub-account 0221 - Domestic Entrusted Investors has seven third-level accounts:

+ Account 02211 - Stock Portfolio;

+ Account 02212 - Bond Portfolio;

+ Account 02213 - Fund Certificates;

+ Account 02214 - Deposit Certificates;

+ Account 02215 - Term Deposits;

+ Account 02216 - Derivative Securities Portfolio;

+ Account 02218 - Other Designated Investment Portfolios.

- Sub-account 0222 - Foreign Entrusted Investors: This account reflects the current balance and changes in quantity and value of the investment portfolio of foreign entrusted investors.

Sub-account 0222 - Foreign Entrusted Investors has seven third-level accounts:

+ Account 02221 - Stock Portfolio;

+ Account 02222 - Bond Portfolio;

+ Account 02223 - Fund Certificates;

+ Account 02224 - Deposit Certificates;

+ Account 02225 - Term Deposits;

+ Account 02226 - Derivative Securities Portfolio;

+ Account 02228 - Other Designated Investment Portfolios.

4.2. Accounting Methods for Some Main Economic Transactions

- When receiving, purchasing securities, certificates, making savings deposits, etc., for entrusted investors according to the entrusted portfolio management contract, debit Account 022 - "Investment Portfolio of Entrusted Investors" based on the details of each type of security and certificate purchased.

- When selling or transferring certificates, securities back to entrusted investors, credit Account 022 - "Investment Portfolio of Entrusted Investors".

5. Supplement Account 023 - Receivables of Entrusted Investors

This account is used to track receivables of entrusted investors arising from entrusted investments such as interest on entrusted investments due but not yet collected, other benefits that entrusted investors are entitled to, and other receivables.

5.1. Structure and Content Reflected in Account 023 - Receivables of Entrusted Investors

Debit Side:

Value of receivables of entrusted investors.

Credit Side:

Value of receivables of entrusted investors already collected.

Debit Balance:

Value of receivables still outstanding at the end of the period for entrusted investors.

5.2. Accounting Methods for Some Main Economic Transactions

- The amount of interest on entrusted investments due but not yet collected, or other receivables related to entrusted investors not yet collected, the fund management company is responsible for tracking these receivables and debiting Account 023 - Receivables of Entrusted Investors.

- When receiving interest from entrusted investors, credit Account 023 - Receivables of Entrusted Investors.

Simultaneously debit Account 021 - Deposits of Entrusted Investors.

6. Supplement Account 024 - Payables of Entrusted Investors

This account is used to track payments of payables of entrusted investors such as fees payable to the fund management company and other payables.

6.1. Structure and Content Reflected in Account 024 - Payables of Entrusted Investors

Debit Side:

Value of payables of entrusted investors arising.

Credit Side:

Value of payables of entrusted investors already paid.

Debit Balance:

Value of payables still outstanding at the end of the period for entrusted investors.

6.2. Accounting Methods for Some Main Economic Transactions

- When generating payables of entrusted investors such as fees and other payables, debit Account 024 - "Payables of Entrusted Investors".

- When using entrusted investor deposits to pay off debts, credit Account 024 - "Payables of Entrusted Investors"

Simultaneously credit Account 021 - Deposits of Entrusted Investors.

Article 10. Annual financial reporting system and interim financial reporting

1. Annual Financial Report

The annual financial reporting system applicable to Fund Management Companies includes the following five reports:

- Balance Sheet Model B 01 - CTQ

- Income Statement Model B 02 - CTQ

- Cash Flow Statement Model B 03 - CTQ

- Equity Movement Report Model B 05 - CTQ

- Financial Statement Notes Model B 09 - CTQ

2. Interim Financial Reports

Fund Management Companies must prepare four full interim financial reports as follows:

- Interim Balance Sheet (full version) Model B 01a - CTQ

- Interim Income Statement Model B 02a - CTQ

(full version)

- Interim Cash Flow Statement Model B 03a - CTQ

(full version)

- Selected Financial Statement Notes Model B 09a - CTQ

Article 11. Financial report models for Fund Management Companies:

1. Annual Financial Report Model (Annex 02)

2. Full version of Interim Financial Report: The full version of Interim Financial Reports for Fund Management Companies are similar to the full version of Interim Financial Reports issued pursuant to Decision No. 15/2006/QĐ-BTC dated March 20, 2006. The indicators in each Interim Financial Report shall be applied as those in the Annual Financial Report issued under this Circular.

Article 12. Content and method of preparing annual financial reports.

1. Balance Sheet (Model B 01 - CTQ).

The content and method of preparing certain indicators have been revised and supplemented. Indicators not specified in this Circular shall be prepared according to the Accounting System for Enterprises issued pursuant to Decision No. 15/2006/QĐ-BTC dated March 20, 2006 of the Ministry of Finance and subsequent Circulars amending and supplementing the Accounting System for Enterprises.

Accounts Receivable from Business Activities (Code 134)

Reflects receivables of Investment Funds, Securities Companies regarding management fees, receivables from entrusted investors for portfolio management fees, activity bonus receivables, consulting service receivables, and other business activity receivables at the reporting date.

The figures recorded in the "Accounts Receivable from Business Activities" indicator are the debit balances of Account 132 "Accounts Receivable from Business Activities" on the detailed ledger of Account 132 detailing various business activity receivables.

Government Bond Repurchase Transactions (Code 157)

This indicator reflects the value of government bonds held by the buyer before the end of the repurchase agreement term at the reporting date.

The figures recorded in the "Government Bond Repurchase Transactions" indicator are the debit balances of Account 171 "Government Bond Repurchase Transactions" on the ledger of Account 171.

Short-term Borrowings (Code 311)

Reflects the total value of short-term borrowings from banks, finance companies, and other entities at the reporting date. The figures recorded in the "Short-term Borrowings" indicator are the credit balances of Account 311 "Short-term Borrowings" on the general ledger and the credit balances of Account 341 on the detailed ledger of Account 341 "Long-term Borrowings" (portion due within the next accounting period).

Advance Payments from Customers (Code 313)

This indicator reflects the total advance payments made by customers to purchase tools, equipment, assets, and services at the reporting date. It does not reflect unearned revenues (including advance receipts). The figures recorded in the "Advance Payments from Customers" indicator are the credit balances of Account 131 "Receivables from Customers" opened for each customer on the detailed ledger of Account 131.

Reward and Welfare Fund (Code 323)

This indicator reflects the Reward and Welfare Fund and unused executive bonuses at the reporting date.

The figures recorded in the "Reward and Welfare Fund" indicator are the credit balances of Account 353 "Reward and Welfare Fund" on the ledger of Account 353.

Government Bond Repurchase Transactions (Code 327)

This indicator reflects the value of government bonds held by the seller before the end of the repurchase agreement term at the reporting date.

The figures recorded in the "Government Bond Repurchase Transactions" indicator are the credit balances of Account 171 "Government Bond Repurchase Transactions" on the ledger of Account 171.

Unearned Revenue - Short Term (Code 328)

This indicator reflects short-term unearned revenue at the reporting date. The figures recorded in the "Unearned Revenue - Short Term" indicator are the credit balances of Account 3387 "Unearned Revenue" on the detailed ledger of Account 3387 for unearned revenue expected to be realized within the next 12 months.

Long-term Borrowings and Liabilities (Code 334)

The figures recorded in the "Long-term Borrowings and Liabilities" indicator are the total credit balances of Accounts 341 "Long-term Borrowings", 342 "Long-term Liabilities", and 343 "Issued Bonds" on the detailed ledgers of these accounts, minus the long-term borrowings due within the next period already reflected in Code 311.

Unearned Revenue - Long Term (Code 338)

This indicator reflects long-term unearned revenue at the reporting date. The figures recorded in the "Unearned Revenue - Long Term" indicator are the credit balances of Account 3387 "Unearned Revenue" on the detailed ledger of Account 3387 for unearned revenue expected to be realized beyond 12 months.

Science and Technology Development Fund (Code 339)

This indicator reflects the unused Science and Technology Development Fund at the reporting date.

The figures recorded in the "Science and Technology Development Fund" indicator are the credit balances of Account 356 "Science and Technology Development Fund" on the ledger of Account 356.

Investor Compensation Reserve Fund (Code 359)

This indicator reflects the unused Investor Compensation Reserve Fund at the reporting date.

The figures recorded in the "Investor Compensation Reserve Fund" indicator are the credit balances of Account 359 "Investor Compensation Reserve Fund" on the general ledger of Account 359.

Content and method of preparing indicators outside the Balance Sheet:

Indicators outside the Balance Sheet include some indicators reflecting assets not owned by the company but managed or used by the company, and some supplementary indicators that cannot be reflected in the Balance Sheet.

Deposited securities of the Fund Management Company (Code 006)

Reflects the total value of securities (par value) of the Fund Management Company currently deposited at the Securities Depository Center, categorized by type: traded securities, temporarily suspended trading securities, pledged securities, held securities, pending settlement securities, frozen pending withdrawal securities, pending trading securities, margin securities for loan collateral, transaction error correction securities. The data for this indicator is taken from the debit balance of Account 012 "Deposited securities of the Fund Management Company" on the Detailed Ledger according to each entity on the detailed accounting ledger of Account 012.

Undeposited securities of the Fund Management Company (Code 020)

Reflects the total value of securities (par value) that the Fund Management Company has not yet deposited and are currently held by the company. The data for this indicator is taken from the debit balance of Account 015 "Undeposited securities of the Fund Management Company" on the General Ledger.

Entrusted investment deposits (Code 030) Reflects the amount of entrusted investment deposits made by investors at the payment bank used to purchase securities through the portfolio management service contracted with the Fund Management Company under the entrusted management agreement. The data for this indicator is taken from the debit balance of Account 021 "Entrusted investment deposits" on the General Ledger.

Entrusted investor's investment portfolio (Code 040)

Reflects the quantity and value of various types of securities purchased by the Fund Management Company under contracts signed with entrusted investors regarding securities portfolio management services. The data for this indicator is taken from the debit balance of Account 022 "Entrusted investor's investment portfolio" on the General Ledger.

Receivables from entrusted investors (Code 050)

Reflects the amount still receivable at the end of the period from entrusted investors. The data for this indicator is taken from the debit balance of Account 023 "Receivables from entrusted investors" on the General Ledger Account 023.

Payables to entrusted investors (Code 051)

Reflects the amount still payable at the end of the period to entrusted investors. The data for this indicator is taken from the debit balance of Account 024 "Payables to entrusted investors" on the General Ledger Account 024.

2. Report on the Changes in Shareholders' Equity (Form B05-CTQ)

This report is used to reflect the changes in shareholders' equity of the Fund Management Company.

Column A "Indicator" reflects indicators belonging to shareholders' equity.

Columns 1 and 2 "Beginning Balance" reflect the beginning balance (including previous year and current year) of each indicator belonging to shareholders' equity.

Data for Column 1 "Previous Year" according to each indicator is based on the data recorded in Column 7 of this report in the previous year.

Data for Column 2 according to each indicator is based on the data recorded in Column 8 of this report in the previous year, or the data for Column 2 is based on the accounting records of Accounts 411, 412, 413, 414, 415, 418, 419, and 421 in the current year.

Columns 3, 4, 5, and 6 "Increase/Decrease" reflect the increase or decrease in shareholders' equity according to each indicator.

Data for Column 3 "Increase", Column 4 "Decrease" of the previous year according to each indicator is based on the data in Column 5 "Increase"; Column 6 "Decrease" of this report in the previous year.

Data recorded in Column 5 "Increase", Column 6 "Decrease" of the current year according to each indicator is based on the accounting records of Accounts 411, 412, 413, 414, 415, 418, 419, and 421 in the reporting year.

Columns 7 and 8 "Ending Balance" reflect the ending balance (including previous year and current year) of shareholders' equity according to each indicator. Data recorded in Column 7 (ending balance of the previous year) of this report in the current year is based on the data recorded in Column 8 (ending balance of the current year) of this report in the previous year.

Data recorded in Column 8 "Ending Balance of the Current Year" of this report in the current year is based on the ending balance of Accounts 411, 412, 413, 414, 415, 418, 419, and 421 in the reporting year.

This Circular takes effect from January 1, 2012.

Article 13. Effectiveness

This Circular replaces Decision No. 62/2005/QĐ-BTC dated September 14, 2005, of the Minister of Finance on Accounting Regulations for Fund Management Companies.

Article 14.

1. The Head of the Accounting System and Audit Department, the Chairman of the State Securities Commission, the Directors of Fund Management Companies, and the heads of related units shall be responsible for implementing and guiding the implementation of this Circular. Responsibility for implementation

2. In the process of implementing this Circular, if there are difficulties or obstacles, it is recommended that units report to the Ministry of Finance for study and resolution./.

- Prime Minister, Deputy Prime Ministers (for reporting);