Circular No. 22/2017/TT-NHNN Amending and supplementing certain provisions of the Accounting Chart of Accounts for credit institutions issued pursuant to Decision No. 479/2004/QĐ-NHNN dated April 29, 2004, and the Financial Reporting System for credit institutions issued pursuant to Decision No. 16/2007/QĐ-NHNN dated April 18, 2007, of the Governor of the State Bank of Vietnam.

||| CIRCULAR AMENDING AND COMPLETING

||| CERTAIN PROVISIONS OF THE ACCOUNTING SYSTEM FOR CREDIT ORGANIZATIONS ISSUED TOGETHER WITH DECISION NO. 479/2004/QĐ-NHNN ||| AND THE FINANCIAL REPORTING REGIME FOR CREDIT ORGANIZATIONS ISSUED TOGETHER WITH DECISION NO. 16/2007/QĐ-NHNN

|||

||| April 29, 2004 ||| AND THE FINANCIAL REPORTING REGIME FOR CREDIT ORGANIZATIONS

||| ISSUED TOGETHER WITH DECISION NO. 16/2007/QĐ-NHNN

||| APRIL 18, 2007 OF THE GOVERNOR OF THE STATE BANK OF VIETNAM

 _______________________

Pursuant to Decree No. 50/2014/NĐ-CP dated May 20, 2014 of the Government on state foreign exchange reserve management;

||| Pursuant to the Law on Credit Organizations dated June 16, 2010 and the Law Amending and Supplementing Certain Provisions of the Law on Credit Organizations dated November 20, 2017;

Pursuant to the Accounting Law dated November 20, 2015;

||| Pursuant to Decree No. 16/2017/NĐ-CP dated February 17, 2017 of the Government stipulating the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

At the proposal of the Director of the Department of Finance and Accounting;

||| The Governor of the State Bank of Vietnam promulgates this Circular amending and supplementing certain provisions of the Accounting System for credit organizations issued together with Decision No. 479/2004/QĐ-NHNN dated April 29, 2004 and the Financial Reporting Regime for credit organizations issued together with Decision No. 16/2007/QĐ-NHNN dated April 18, 2007 of the Governor of the State Bank of Vietnam.

||| Article 1. Amend and supplement certain contents of the Accounting System for credit organizations issued together with Decision No. ||| 479/2004/QĐ-NHNN dated April 29, 2004 of the Governor of the State Bank of Vietnam

||| Point 8 Section I - General Provisions shall be amended and supplemented as follows:

||| "8. Recording transactions related to foreign currencies and gold

||| The recording on foreign currency accounts specified in this Accounting System shall be carried out according to the following principles:

||| 8.1. Carry out corresponding and balanced entries between foreign currency accounts and each type of foreign currency.

||| 8.2. For foreign currency purchase and sale transactions, record simultaneous corresponding entries in foreign currency and Vietnamese dong.

||| 8.3. Gold at credit organizations shall be recorded similarly to foreign currencies (gold is considered a type of foreign currency), unit being "taels" of 99.99% gold and record purchase and sale transactions through Accounts 4711 and 4712 similarly to foreign currency purchase and sale transactions.

||| 8.4. Income and expenses denominated in foreign currencies shall be converted into Vietnamese dong through the foreign currency trading account to record income and expenses in Vietnamese dong.

||| 8.5. Recording exchange rate

||| a) The exchange rate used for recording foreign currency/purchase and sale transactions is the actual buying and selling rate at the time of economic and financial transactions.

||| b) The exchange rate used for converting other foreign currency transactions into Vietnamese dong:

||| (i) Credit organizations licensed to conduct foreign exchange business: Is the average buying and selling spot rate of that foreign currency (hereinafter referred to as the spot rate) of the credit organization at the time of economic and financial transactions or the average spot rate of all changes in the rate on the transaction date.

||| (ii) Credit organizations not licensed to conduct foreign exchange business: Is the spot rate at the time of economic and financial transactions of the commercial bank with which the credit organization conducts the most transactions during the accounting period.

||| (iii) In case the credit organization does not have the spot rate of the convertible foreign currency, the credit organization converts through another foreign currency with a quoted exchange rate against the Vietnamese dong, listed on Reuters or Bloomberg screens or other means for those foreign currencies not displayed on Reuters or Bloomberg screens at the time of conversion.

||| 8.6. At the end of the month, quarter, or year when preparing the Balance Sheet converted in each foreign currency, credit organizations must convert the balance and activity volume of foreign currency accounts into Vietnamese dong for consolidation and reflection in the monthly balance sheet in Vietnamese dong as follows:

||| a) Credit organizations licensed to conduct foreign exchange business:

||| (i) For monetary items denominated in foreign currencies:

||| Convert using the spot rate (for gold, convert using the average buying and selling rate of gold) at the end of the last working day of the month, quarter, or year of the credit organization if this rate differs by less than 1% from the weighted average buying and selling rate of the last working day of the month, quarter, or year.

||| If the spot rate at the end of the last working day of the month, quarter, or year differs by 1% or more from the weighted average buying and selling rate of the last working day of the month, quarter, or year, the credit organization uses the weighted average buying and selling rate of the last working day of the month, quarter, or year for conversion.

||| The weighted average buying and selling rate is calculated by dividing the sum of the weighted average buying rate and the weighted average selling rate by 2 (two).

||| Wherein, the weighted average buying/selling rate is determined based on the total amount of transactions in Vietnamese dong divided by the quantity of foreign currency bought/sold on that day.

||| In case the credit organization does not have the spot rate of the convertible foreign currency at the end of the last working day of the month, quarter, or year, the credit organization converts through another foreign currency with a quoted exchange rate against the Vietnamese dong, listed on Reuters or Bloomberg screens or other means for those foreign currencies not displayed on Reuters or Bloomberg screens at the time of conversion.

||| (ii) For non-monetary items (foreign currency investment contributions, etc.): Convert using the exchange rate recorded on the recording date.

||| b) Credit organizations not licensed to conduct foreign exchange business:

||| (i) For monetary items denominated in foreign currencies: Convert using the spot rate at the end of the last working day of the month, quarter, or year of the commercial bank with which the credit organization conducts the most transactions during the accounting period.

||| In case the credit organization does not have the spot rate of the convertible foreign currency at the end of the last working day of the month, quarter, or year, the credit organization converts through another foreign currency with a quoted exchange rate against the Vietnamese dong, listed on Reuters or Bloomberg screens or other means for those foreign currencies not displayed on Reuters or Bloomberg screens at the time of conversion.

(ii) For non-monetary items (such as foreign currency investment contributions, etc.): Convert according to the exchange rate recorded on the accounting date.

8.7. Credit institutions using foreign currency as their accounting currency shall apply accounting for transactions involving other currencies similar to Points 8.4, 8.5, and 8.6.

8.8. Credit institutions with 100% foreign capital and branches of foreign banks may choose to apply international accounting standards for foreign exchange transactions and derivative contracts; at the same time, they must explain the differences between international accounting standards and Vietnamese accounting standards, and the impact of these differences on financial statement information.

8.9. The accounting for foreign currency transactions of credit cooperatives and microfinance organizations shall be guided by the circular issued by the State Bank based on the application of the above regulations, adapted to the specific operations of credit cooperatives and microfinance organizations.

2. Part II - Accounting Chart of Accounts for Credit Institutions (amended by Clause 2 Article 2 Circular No. 10/2014/TT-NHNNdated March 20, 2014 amending and supplementing some accounts in the Accounting Chart of Accounts for Credit Institutions issued pursuant to Decision No. 479/2004/QĐ-NHNNdated April 29, 2004 of the Governor of the State Bank) shall be amended and supplemented as follows:

a) Rename Account 20 - Loans to Other Credit Institutions to "Credit Granted to Other Credit Institutions".

b) Rename Account 275 - Other Loans to "Other Credit Grants".

c) Rename Account 387 - Assets Secured by Debt Transfer Ownership Rights to Credit Institution, Pending Disposal to "Assets Substituting for Guarantor's Obligations Transferred Ownership Rights to Credit Institution, Pending Disposal".

d) Rename Account 41 - Debts from Other Credit Institutions to "Debts from Other Financial and Credit Institutions".

đ) Amend and supplement Account 419 - Discount and Rediscount Borrowings of Transferable Instruments and Other Securities as follows:

(i) Rename to "Receivables from Other Credit Grants";

(ii) Add third-level subaccounts "4191 - Receivables from Discount and Rediscount Borrowings of Transferable Instruments and Other Securities" and "4199 - Other Receivables from Credit Grants" under this account.

e) Add third-level subaccount "9823 - Interest from Joint Venture Loan Contracts" under Account 982 - Loans under Joint Venture Loan Contracts.

g) Add third-level subaccount "9833 - Interest from Entrusted Credit Activities" under Account 983 - Credit Grants under Entrusted Loan Contracts.

h) Amend and supplement Account 994 - Collateral and Pledged Assets of Customers as follows:

(i) Rename to "Customer's Collateral and Pledged Securities and Assets";

(ii) Add third-level subaccounts "9941 - Customer's Collateral and Pledged Securities and Assets" and "9942 - Customer's Securities Discounted and Rediscounted and Transferred Ownership Rights" under this account.

i) Amend and supplement Account 996 - Customer's Pledged Securities as follows:

(i) Rename to "Securities Borrowed, Customer's Securities Discounted and Rediscounted and Transferred Ownership Rights Used";

(ii) Add third-level subaccounts "9961 - Securities Borrowed" and "9962 - Customer's Securities Discounted and Rediscounted and Transferred Ownership Rights Used" under this account.

3. Part III - Content of Accounting Entries (amended by Articles 2 and 3 Circular No. 10/2014/TT-NHNNdated March 20, 2014 amending and supplementing some accounts in the Accounting Chart of Accounts for Credit Institutions issued pursuant to Decision No. 479/2004/QĐ-NHNNdated April 29, 2004 of the Governor of the State Bank) shall be amended and supplemented as follows:

a) Rename Account 20 - Loans to Other Credit Institutions to "Credit Granted to Other Credit Institutions".

b) Rename Account 275 - Other Loans to "Other Credit Grants".

c) Amend and supplement Account 34 as follows:

"Account 34 - Long-term Contributions and Investments

This account is used to reflect the value and changes in long-term contributions and investments of credit institutions.

Entries into this account must comply with the following provisions:

1. Entries on this account include: Contributions to subsidiaries, joint venture contributions to jointly controlled businesses, contributions to associated companies, and other long-term investments not listed on the stock market (long-term investments listed on the stock market should be recorded on Account 15 - Available-for-Sale Securities).

2. When investing through asset contributions, the investor reassesses the contributed assets based on agreements among contributing parties. Any difference between the book value or remaining value and the reassessed value of the contributed assets is recorded as other income or expense.

3. Investment costs are reflected at cost, including purchase price plus (+) directly related transaction costs such as brokerage, advisory, auditing fees, taxes, bank charges, and other expenses. In the case of asset investments, the investment cost is recorded at the fair value of the asset at the time of the economic or financial event.

4. Credit institutions maintain detailed records for contributions to subsidiaries, joint venture contributions to jointly controlled businesses, contributions to associated companies, and other long-term investments. The recognition time for long-term financial investments is when ownership rights are officially established.

5. Fully and promptly record dividends and profits distributed into Account 78 - Income from Equity Investments and Share Purchases and reflect them in the separate financial statements of the parent company at the time of entitlement. Dividends and profits distributed in certain cases are recorded as follows:

a) Dividends and profits distributed in cash or assets after the investment date are recorded as financial revenue at fair value at the time of entitlement;

b) Dividends and profits distributed in cash or assets before the investment date are not recorded as financial revenue but reduce the value of the investment.

c) At the time of determining the value of the credit institution for equitization, if the investments in other enterprises have been evaluated to increase corresponding to the shareholding of the equitized credit institution in the undistributed post-tax profits of subsidiaries, associated companies, and jointly controlled operations, the equitized credit institution must record an increase in state capital in accordance with the provisions of the law. Subsequently, when receiving dividends that were used to evaluate the increase in state capital, the equitized credit institution shall not recognize financial income but shall reduce the investment value.

d) In the case of receiving dividends in the form of shares, it shall be carried out according to the principle:

(i) Credit institutions not wholly owned by the State only monitor the number of shares received on the explanatory notes of the financial statements without recording an increase in the investment value and financial income activities;

(ii) Credit institutions wholly owned by the State shall carry out accounting in accordance with the legal regulations applicable to wholly state-owned enterprises.

6. In the case of contributing capital or investing in foreign currency, the credit institution must convert to the unit of accounting currency at the exchange rate specified in Point 8 Section I-General Provisions. The credit institution shall not revalue contributed capital for purchasing shares, including cases where exchange rate differences are recorded to increase (decrease) contributed capital.

Account 34 includes the following second and third level accounts:

341- Investment in subsidiaries in Vietnamese dong

342- Joint venture capital contribution in Vietnamese dong

3421- Joint venture capital contribution with other credit institutions

3422- Joint venture capital contribution with economic organizations

343- Investment in associated companies in Vietnamese dong

344- Other long-term investments in Vietnamese dong

345- Investment in subsidiaries in foreign currency

346- Joint venture capital contribution in foreign currency

3461- Joint venture capital contribution with other credit institutions

3462- Joint venture capital contribution with economic organizations

347- Investment in associated companies in foreign currency

348- Other long-term investments in foreign currency

349- Provision for reduction in value of long-term investments

Account 341- Investment in subsidiaries in Vietnamese dong

Account 345- Investment in subsidiaries in foreign currency

This account is used to reflect the current value and changes in direct investment capital contributions in subsidiaries. A subsidiary is a company under one of the circumstances prescribed in Clause 30 Article 4 of the Law on Credit Institutions.

Accounting on this account must comply with the accounting regulations of Account 34, Vietnamese Accounting Standard No. 25-Merger Financial Statements and the following provisions:

Accounting for economic transactions occurring during the business combination process, where the credit institution is determined as the buyer in a business combination leading to a parent-subsidiary relationship, shall be carried out in accordance with Vietnamese Accounting Standard No. 11-Business Combinations and the Circular guiding this standard.

Account 342- Joint venture capital contribution in Vietnamese dong

Account 346- Joint venture capital contribution in foreign currency

This account is used to reflect the total joint venture capital contributions in the form of establishing a jointly controlled operation and the situation of recovering joint venture capital contributions upon termination of the joint venture agreement.

A jointly controlled operation is established by the joint venture capital contributors. A jointly controlled operation is a newly established independent business entity operating like a business enterprise but still subject to the control of the joint venture parties according to the joint venture agreement. A jointly controlled operation must organize its own accounting work in accordance with the current legal regulations on accounting.

Capital contributions to a jointly controlled operation include all types of assets and funds belonging to the enterprise, including long-term loans used for capital contributions.

Accounting on this account must comply with the accounting regulations of Account 34, Vietnamese Accounting Standard No. 08-Financial Information on Joint Venture Contributions and the following provisions:

1. Investments in a jointly controlled operation are recorded on this account when the credit institution has the right to co-control the financial policies and operations of the jointly controlled operation receiving the investment. When the credit institution no longer has the right to co-control, it must record a decrease in the investment in the jointly controlled operation on these accounts.

2. Joint venture capital contributions are made in three forms: Jointly Controlled Operations, Jointly Controlled Assets, and Jointly Controlled Businesses. Accounts 342 and 346 are only used for accounting of joint venture capital contributions to jointly controlled businesses and do not apply to jointly controlled operations and jointly controlled assets.

3. The value of capital contributions to a jointly controlled operation reflected on this account must be the value of the capital contributions agreed and approved by the participating joint venture parties in the capital contribution document.

4. Direct costs related to the investment activities in associated companies and jointly controlled operations are recorded as financial expenses incurred in the period.

5. When recovering joint venture capital contributions, the amount of capital already contributed is reduced based on the value of the assets and money returned by the jointly controlled operation. If there is a loss due to insufficient recovery of capital contributions, this loss is recorded as a business activity expense of the credit institution. If the recovery value exceeds the amount of capital already contributed, the profit from the recovery is recorded as income from capital contributions and share purchases.

6. The joint venture capital contributors to a jointly controlled operation have the right to transfer the value of their joint venture capital contributions. If the transfer value exceeds the amount of capital already contributed to the jointly controlled operation, the profit from the capital transfer is reflected on the Credit side of the Other Income account. Conversely, if the transfer value is less than the amount of capital already contributed, the loss from the capital transfer is reflected on the Debit side of the Other Expenses account.

7. A joint venture entity under common control shall not recognize expenses arising from the transfer of capital contributions among joint venture parties.

8. When a credit institution repurchases another party's equity interest in a jointly controlled operation, it shall reflect the equity interest in the jointly controlled operation at the actual purchase price.

Account 343 - Investment in associated companies in Vietnamese dong

Account 347 - Investment in associated companies in foreign currency

This account is used to record the value of direct investments made by investors in associated companies and the changes in the investment value. An associated company of a credit institution is defined as per Clause 29, Article 4 of the Law on Credit Institutions.

Entries into this account must comply with the accounting rules for Account 34 and the following provisions:

The basis for recording the value of investment in associated companies in the accounting books is as follows:

- For investments in listed joint-stock companies on the securities market, the entries by the credit institution are based on the actual payment amount when purchasing shares, including all directly related costs, and the official announcement by the Securities Trading Center confirming that the shares of the associated company belong to the investor.

- For investments in unlisted joint-stock companies on the securities market, the entries are based on share ownership confirmation certificates and share sale receipt certificates issued by the invested company or purchase transaction documents.

- For investments in other types of enterprises, the entries are based on capital contribution documents and purchase-sale transaction documents.

- A credit institution may only recognize dividends or profits distributed by an associated company upon receiving an official notification from the associated company regarding the dividend or profit distribution for the period.

Account 344 - Other long-term investments in Vietnamese dong

Account 348 - Other long-term investments in foreign currency

This account is used to record the current value and fluctuations in other types of long-term investments (excluding investments in subsidiaries, equity interests in jointly controlled operations, investments in associated companies as stipulated in Clause 29, Article 4 of the Law on Credit Institutions, and listed stock).

Entries on this account must comply with the accounting rules for Account 34 and the following provisions:

Accounting must track in detail according to the following indicators:

- For stock investments: track in detail by each type of par value stock and each issuer.

- For non-listed equity contributions under contracts: track in detail by each contributing party.

Account 349 - Provision for impairment of long-term investments

This account is used to record the current balance and fluctuations in impairment provisions for long-term investments.

Entries on this account must be carried out according to the following regulations:

1. Impairment provisions are established in accordance with the legal provisions on the establishment and use of provisions.

2. If the amount of provision required to be established this year exceeds the amount recorded in the accounting books, the difference is recognized as an expense for the period. If the amount of provision required to be established this year is lower than the unused balance of the provision established last year, the difference is recorded as a reduction in expenses. In cases where the expense account balance is insufficient to offset the reversal of the provision, the accounting records the remainder in the income account.

3. The impairment provision for financial investments is used to offset actual losses of long-term investments due to reasons such as the investee going bankrupt, natural disasters, etc., leading to the investment being unrecoverable or recoverable at a value lower than the original cost. This provision is not used to offset losses from the liquidation of investments.

d) Amend and supplement Account 387 as follows:

"Account 387 - Assets received in lieu of performance of guarantee obligations transferred to the credit institution for processing

This account is used to record the value of assets received in lieu of performance of guarantee obligations transferred to the credit institution for processing. The credit institution must have complete documentation proving its lawful ownership of these assets.

d) Amend the name of Account 41 - Debts to Other Financial Institutions to "Debts to Other Financial Organizations and Financial Institutions"

e) Amend and supplement Account 419 as follows:

"Account 419 - Receiving Other Credit Facilities

This account is used to reflect the value of debts of other financial organizations and financial institutions (excluding those already recorded in Accounts 415, 416, 417, 418).

The accounting for this account must comply with the following regulations:

1. Financial institutions shall not record in this account debts whose contents are already prescribed to be recorded in appropriate other accounts.

2. Financial institutions need to closely manage and monitor debts according to each borrowing content and each financial organization and financial institution providing credit.

Account 419 has the following third-level accounts:

4191 - Receiving Credit Facilities in the Form of Discounting and Rediscounting Transferable Instruments and Other Valuable Papers

4199 - Receiving Other Credit Facilities

Account 4191 - Receiving Credit Facilities in the Form of Discounting and Rediscounting Transferable Instruments and Other Valuable Papers

This account is used to reflect the amount of debt of other financial institutions in the form of discounting and rediscounting transferable instruments and valuable papers.

Account 4199 - Receiving Other Credit Facilities

This account is used to reflect the value of debts of other financial organizations and financial institutions (excluding contents already prescribed to be recorded in appropriate other accounts).

The content of accounting for Account 4199 is similar to the content of accounting for Account 4191.”

g) Amend and supplement Account 471 as follows:

"Account 471 - Foreign Currency Trading

This account is used to reflect the value of foreign currency trading purchases and sales of financial institutions.

The accounting for this account must comply with the following regulations:

1. Implement determination of business results:

- At the end of the accounting period, determine the difference between the actual selling price of foreign currency sold and the average purchase price in the month, if no purchase was made in the month, then use the average purchase price of the previous month, subsequently transferring this difference to the Revenue or Expense account for foreign currency trading as appropriate.

- In cases where financial institutions have the ability to apply information technology to assess business results for each transaction of buying or selling foreign currency on the same day based on the actual buying or selling rate and the daily average rate, they must ensure accurate data and compliance with Accounting Standard No. 10 - Effects of Changes in Exchange Rates.

2. Revaluation of foreign currency: After implementing the determination of business results as specified in point 1 above, proceed to determine the increase or decrease in the value of foreign currency trading (periodically at the end of the month) based on comparing the balance of Account 4711 - Purchases and Sales of Foreign Currency Trading (after revaluation according to the exchange rate specified in Point 8 Section I - General Provisions) with the balance of Account 4712 - Settlement of Purchases and Sales of Foreign Currency Trading to find the difference. If there is a difference, adjust the balance of Account 4712 to match the balance of Account 4711 (converted to Vietnamese Dong). This difference will be transferred to the Credit or Debit side of Account 631 - Exchange Rate Differences (recorded against Account 4712).

Account 471 has the following third-level accounts:

4711 - Purchases and Sales of Foreign Currency Trading

4712 - Settlement of Purchases and Sales of Foreign Currency Trading

Account 4711 - Purchases and Sales of Foreign Currency Trading

This account is used to record the value of foreign currency purchased and sold based on foreign currency purchased before being sold (sold from the source of foreign currency trading).

Account 4712 - Settlement of Purchases and Sales of Foreign Currency Trading

This account is used to record payments in Vietnamese Dong for purchasing foreign currency or receipts from selling foreign currency corresponding to the value of foreign currency purchased or sold under Account 4911 - Purchases and Sales of Foreign Currency Trading.

h) Amend and supplement Account 6312 as follows:

"Account 6312 - Exchange Rate Differences During the Construction Investment Phase

This account is used to reflect exchange rate differences arising from revaluation of foreign currency accounts of construction investment activities (before operation, not yet completed).

At year-end, this account settles its balance. If this account has a Credit balance, transfer the Credit balance to the Income Account; if this account has a Debit balance, transfer the Debit balance to the Expense Account.

i) Amend and supplement Account 911 as follows:

“Account 911 - Foreign Currency

This account is used to reflect managed foreign currencies. The amounts on accounts outside the Balance Sheet regarding foreign currency are recorded in their original currency. At month-end, convert (for reporting purposes) all these foreign currency accounts according to the exchange rate specified in Point 8, Section I - General Provisions.

Account 911 includes the following third-level accounts:

9113 - Foreign Currency Deposited Abroad for Collection by Customers

9114 - Non-Circulating Foreign Currency Awaiting Processing

Account 9113 - Foreign Currency Deposited Abroad for Collection by Customers

This account is used to record foreign currency deposited abroad for collection by customers.

Account 9114 - Non-Circulating Foreign Currency Awaiting Processing

This account is used to record counterfeit foreign currency, damaged foreign currency (cut, altered, torn) awaiting processing.

k) Supplement the third-level account "9823 - Interest on Loans under Joint Venture Contracts" under Account 982 as follows:

"Account 9823 - Interest on Loans under Joint Venture Contracts

This account is opened at the lead financial institution, used to reflect the value of interest-bearing debt on loans made by member financial institutions under joint venture contracts.

l) Supplement the third-level account "9833 - Interest from Loan Disbursement Activities under Entrusted Contract" under Account 983 as follows:

"Account 9833 - Interest from Loan Disbursement Activities under Entrusted Contract

This account is opened at the entrusted financial institution making loan disbursements, used to reflect the value of interest-bearing debt from loan disbursement activities under entrusted contracts.

m) Amend and supplement Account 994 as follows:

"Account 994 - Customer Collateral, Pledged Assets, and Discounted Securities

This account is used to reflect collateral, pledged assets, and discounted securities of customers held by financial institutions as stipulated.

Account 994 includes the following third-level accounts:

9941 - Customer Collateral and Pledged Assets

9942 - Customer Discounted and Re-discounted Securities Transferred Ownership

Account 9941 - Customer Collateral and Pledged Assets

This account is used to reflect the value of collateral and pledged assets (face value) of customers held by financial institutions as security for loans.

Account 9942 - Customer Discounted and Re-discounted Securities Transferred Ownership

This account is used to reflect the value of discounted and re-discounted securities (face value) of customers transferred ownership to financial institutions.

n) Amend and supplement Account 996 as follows:

"Account 996 - Securities Borrowed, Customer Discounted and Re-discounted Securities Transferred Ownership Used

This account is used to reflect the value of securities borrowed (face value) and customer discounted and re-discounted securities transferred ownership used by financial institutions.

Account 996 includes the following third-level accounts:

9961 - Securities Borrowed

9962 - Customer Discounted and Re-discounted Securities Transferred Ownership Used

Account 9961 - Securities Borrowed

This account is used to reflect the value of securities borrowed (face value) by financial institutions.

Account 9962 - Negotiable Instruments of Customers Submitted for Discounting and Rediscounting with Ownership Rights Transferred for Use

This account is used to reflect the value (face value) of negotiable instruments of customers submitted for discounting and rediscounting with ownership rights transferred for use.

Article 2. Amending and supplementing some articles of the Financial Reporting System for Credit Institutions issued together with Decision No. 16/2007/QĐ-NHNN on April 18, 2007 by the Governor of the State Bank of Vietnam

1. Article 3 shall be amended and supplemented as follows:

“Article 3. Principles of Preparing Financial Statements and Currency Used for Preparing Financial Statements

1. The preparation and presentation of financial statements must comply with the principles stipulated in the Vietnamese Accounting Standards on Presentation of Financial Statements, including: Going Concern, Accrual Basis, Consistency, Materiality and Aggregation, Netting, Comparability, and additional requirements specified in the Vietnamese Accounting Standards on Supplementary Presentation of Financial Statements of Banks and Similar Financial Institutions, and relevant laws.

Currency used for preparing financial statements when published to the public and submitted to state management agencies in Vietnam

If credit institutions use foreign currency as the unit of account in accounting, they must convert the financial statements from the unit of account in accounting (foreign currency) to Vietnamese Dong when publishing to the public and submitting to state management agencies in Vietnam.

3. Principles for Preparing Financial Statements When Changing the Unit of Account in Accounting

a) When changing the unit of account in accounting, the accountant shall convert the balances in the accounting books to the new unit of account in accounting according to the following principle:

(i) For credit institutions licensed to operate foreign exchange: using the average buying and selling transfer rate of the credit institution on the day of changing the unit of account in accounting.

(ii) For credit institutions not licensed to operate foreign exchange: using the average buying and selling transfer rate of the commercial bank with which the credit institution conducts the most transactions during the accounting period on the day of changing the unit of account in accounting.

b) Exchange rates applied to comparative information on the Balance Sheet, Income Statement, and Cash Flow Statement:

When presenting comparative period information (the "previous year" column on the annual Balance Sheet, Income Statement, and Cash Flow Statement; the "beginning of the year" column on the mid-year Balance Sheet), credit institutions apply the corresponding exchange rate of the comparative period.

c) When changing the unit of account in accounting, credit institutions must clearly present in the Notes to the Financial Statements the reasons for changing the unit of account in accounting and the effects (if any) on the financial statements due to the change in the unit of account in accounting.”

means projects, works, designs for developing, applying, implementing technology or other tasks within the scope of technical fields managed by technical staff, classified according to types and levels (groups) as stipulated by specialized laws."

“Article 3a. Principles for Converting Financial Statements Prepared in Foreign Currency to Vietnamese Dong

1. For credit institutions licensed to operate foreign exchange:

a) Assets and Liabilities are converted to Vietnamese Dong:

Assets and liabilities are converted to Vietnamese Dong at the spot buying and selling transfer rate at the end of the last working day of the reporting period if this rate differs by less than 1% from the weighted average buying and selling rate of the last working day of the reporting period.

In case the spot buying and selling transfer rate at the end of the last working day of the reporting period differs by 1% or more from the weighted average buying and selling rate of the last working day of the reporting period, the credit institution uses the weighted average buying and selling rate of the last working day of the reporting period to convert.

The weighted average buying and selling rate is calculated according to point 8.6 Section I - General Provisions, Accounting System for Credit Institutions.

b) Registered Capital in Foreign Currency (capital contributed, capital contribution, registered capital increase in accordance with the law) is converted to Vietnamese Dong at the spot buying and selling transfer rate of the credit institution at the time of receiving capital contribution or the weighted average buying and selling transfer rate of the credit institution calculated based on all changes in exchange rates on the date of receiving capital contribution;

c) Undistributed post-tax profit and reserves derived from undistributed post-tax profit arising after the investment date are converted to Vietnamese Dong by calculating according to the items of the Income Statement;

d) Dividends and interest paid are converted to Vietnamese Dong at the spot buying and selling transfer rate of the credit institution on the payment date;

đ) Items belonging to the Income Statement and Cash Flow Statement are converted to Vietnamese Dong at the spot buying and selling transfer rate of the credit institution at the time of occurrence of economic and financial transactions. In case the average exchange rate of the accounting period at the credit institution is approximately equal to the spot buying and selling transfer rate of the credit institution at the time of occurrence of economic and financial transactions (difference does not exceed 3%), the credit institution may choose to apply the average exchange rate of the accounting period.

e) Exchange differences arising when converting financial statements prepared in foreign currency to Vietnamese Dong are recorded under the item "Exchange Differences" within the equity section of the Balance Sheet and are not recorded in the Income Statement.

2. For credit institutions not licensed to operate foreign exchange:

a) Assets and liabilities shall be converted into Vietnamese dong at the average buying and selling spot transfer rate of the commercial bank with which the credit institution conducts the most transactions during the accounting period, as of the end of the last working day of the reporting period for the commercial bank.

b) Shareholder equity denominated in foreign currency (issued capital, contributed capital, increased capital in accordance with the law) shall be converted into Vietnamese dong at the average buying and selling spot transfer rate of the commercial bank with which the credit institution conducts the most transactions during the accounting period, on the date of receipt of the contributed capital.

c) Undistributed post-tax profit and reserves derived from undistributed post-tax profit arising after the investment date are converted to Vietnamese Dong by calculating according to the items of the Income Statement;

d) Profits and dividends paid shall be converted into Vietnamese dong at the average buying and selling spot transfer rate of the commercial bank with which the credit institution conducts the most transactions during the accounting period, on the date of payment of profits and dividends.

đ) Items included in the Income Statement and Cash Flow Statement shall be converted into Vietnamese dong at the average buying and selling spot transfer rate of the commercial bank with which the credit institution conducts the most transactions during the accounting period, on the date of occurrence of the transaction.

e) Exchange differences arising when converting financial statements prepared in foreign currency to Vietnamese Dong are recorded under the item "Exchange Differences" within the equity section of the Balance Sheet and are not recorded in the Income Statement.

3. Principles for converting financial statements of accounting periods within a year where there is a change in exchange rate policy.

a) The exchange rate applied to comparative information on the Balance Sheet, Income Statement, and Cash Flow Statement:

When presenting comparative period information (the "previous year" column on the annual Balance Sheet, Income Statement, and Cash Flow Statement; the "beginning of the year" column on the mid-year Balance Sheet), credit institutions apply the corresponding exchange rate of the comparative period.

b) Credit institutions must clearly present in the Notes to the Financial Statements any effects (if any) on the Financial Statements due to changes in the exchange rate policy.

This Circular takes effect from December 25, 2025/.

The Director of the Office, the Head of the Department of Finance and Accounting of the State Bank of Vietnam, the Heads of relevant units under the State Bank of Vietnam, the Governors of the State Bank of Vietnam branches in provinces and centrally governed cities, the Chairmen of the Board of Directors, the Chairmen of the Board of Members, and the General Directors (Directors) of credit institutions are responsible for implementing this Circular.

Article 4. Effective date

1. This Circular takes effect from April 1, 2018.

2. From the date this Circular takes effect, the following provisions shall cease to be effective:

a) Clause 20, Clause 25, Clause 28, Clause 29, Clause 46, and Clause 50 of Article 2 of Circular No. 10/2014/TT-NHNN dated March 20, 2014 of the State Bank of Vietnam regarding amendments and supplements to certain accounts in the Accounting System of Credit Institutions issued pursuant to Decision No. 479/2004/QĐ-NHNN dated April 29, 2004 of the Governor of the State Bank of Vietnam.

b) Clause 3 of Article 1 and Clause 2, Clause 3 of Article 2 of Circular No. 49/2014/TT-NHNN dated December 31, 2014 of the State Bank of Vietnam regarding amendments and supplements to certain provisions of the Financial Reporting System for Credit Institutions issued together with Decision No. 16/2007/QĐ-NHNN dated April 18, 2007 and the Accounting System of Credit Institutions issued together with Decision No. 479/2004/QĐ-NHNN dated April 29, 2004 of the Governor of the State Bank of Vietnam./.