We are standing at a crucial juncture in the final months of 2025. Phase 1 of the Project on Applying International Financial Reporting Standards in Vietnam (2022-2025) has officially concluded. Over the past three years, we have witnessed a strong pioneering transformation from large economic groups, leading listed companies, and FDI enterprises to transparently disclose financial information according to global standards.
However, the biggest question now is: What happens next? When we move to Phase 2 (after 2025), which entities will be required to adopt IFRS? And will your business be on the "target" list for transitioning its accounting system from VAS to IFRS?
Understanding the IFRS implementation roadmap under Decision 345/QD-BTC right now not only helps businesses avoid compliance risks but also serves as a strategic preparation to attract new investment capital. Let's explore the overall picture of IFRS in Vietnam with GREEN IN in the article below!
Current status of IFRS application in Vietnam
Before delving into the roadmap, we need to frankly assess the accounting landscape in Vietnam. Currently, Vietnamese Accounting Standards (VAS) remain the official legal standards applied to most businesses. However, VAS, issued between 2000 and 2005, is based on older International Accounting Standards (IAS) and heavily relies on "Rules" and historical cost recognition. This creates a significant gap compared to the modern "language of finance" in the world, which is based on "Principles" and fair value.
During the period from 2022 to 2025, the adoption of IFRS in Vietnam was vibrant among pioneering businesses.
- Banking Sector: Many large joint-stock commercial banks (such as VIB, Techcombank, VPBank...) have proactively prepared financial statements according to IFRS to access capital from international financial institutions (IFC, ADB).
- Listed companies: Major players like Vingroup, Masan, Vinamilk... have also published financial statements according to IFRS alongside VAS to serve foreign shareholders.
This reality shows that the need for transformation is real and stems from the inherent need for transparency within businesses, rather than being forced upon them by regulatory agencies.
Details of the IFRS implementation roadmap according to Decision 345/QD-BTC
On March 16, 2020, the Ministry of Finance issued Decision No. 345/QD-BTC approving the Project on the Application of Financial Reporting Standards in Vietnam. This is the highest legal document shaping the national transformation roadmap.
This roadmap is divided into two distinct phases, focusing primarily on consolidated financial statements:
Phase 1 (2022 to 2025): Voluntary application
This transitional phase has just ended. The Ministry of Finance allows businesses that have the need and sufficient resources to voluntarily adopt IFRS for preparing consolidated financial statements.
- Eligible participants: Parent companies of state-owned economic groups; Parent companies that are listed companies; Large-scale public companies that are unlisted parent companies; Parent companies that are FDI enterprises.
- Results: Businesses participating in this phase benefit from technical support mechanisms from the Ministry of Finance, but must still ensure full compliance with tax regulations and reporting requirements under VAS to state management agencies (dual-bookkeeping system).
Phase 2 (After 2025): Mandatory Implementation and Expansion
This is a crucial phase we are entering. Based on the results of Phase 1's assessment, the Ministry of Finance will publish a specific list of businesses that are required to prepare consolidated financial statements under IFRS.
The groups expected to be subject to mandatory requirements include:
- Parent companies of state-owned economic groups: Aiming to increase transparency of public assets and operational efficiency.
- The parent company is a listed company: Especially companies included in the VN30 index or with large market capitalization, in order to upgrade the Vietnamese stock market.
- Large public companies: Large, unlisted companies that raise capital from the public.
In addition to the mandatory requirements, other businesses (including FDI businesses not subject to mandatory requirements) are encouraged to voluntarily apply if they meet the eligibility criteria.
Regarding separate financial statements, Vietnam continues to use the new Vietnamese Financial Reporting Standards (VFRS), which are revised based on IFRS but adjusted to suit domestic specificities, unless FDI enterprises require the application of IFRS in sync with their parent company.
See more:
Strategic benefits for Vietnamese businesses
Increase access to international capital.
Transparency in financial reporting according to IFRS standards is a crucial prerequisite for businesses to meet the stringent requirements of international financial institutions (such as the World Bank, IFC, and ADB) and foreign investment funds. This is a prerequisite for businesses to access preferential loan sources, issue international bonds, or participate in green and sustainable financing flows.
Accurately reflecting the true value of the business.
Through the "Fair Value" principle, IFRS allows for the recognition of assets (especially real estate, trademarks, and financial instruments) at their market value at the time of reporting. This helps the balance sheet accurately reflect the financial position and actual potential of the business, effectively supporting valuation in M&A transactions or initial public offerings (IPOs).
Enhancing management and decision-making capabilities
Adopting IFRS requires businesses to standardize their data collection and risk management processes according to global standards. A high-quality financial reporting system will provide management with reliable and timely information, forming a solid foundation for strategic and operational management decisions.
This article has helped you understand what IFRS in Vietnam is, as well as the detailed implementation roadmap according to Decision 345/QD-BTC. We hope this information will be helpful in guiding and preparing your business for the upcoming mandatory transition. Don't forget to follow GREEN IN's next articles for more updated information!