I. MARKET RISKS FOR FOUNDERS FROM THE PERSPECTIVE OF INTERNAL ACCOUNTING/ TAX COMPLIANCE
As businesses strive for financial transparency and compliance in financial reporting across all enterprise types—including public administrative units, private enterprises, and foreign-invested companies—the financial and accounting systems must adapt to these demands.
To facilitate this, numerous regulatory measures have been introduced, including new legal frameworks and the elimination of non-compliant businesses. Consequently, enterprises must strengthen their accounting departments to stay updated on legal changes, implement them effectively, and mitigate tax risks while strategically managing investment funds. Additionally, businesses need to ensure their financial reports align with the expectations of foreign investors to secure capital contributions and allocate investments efficiently.
The roadmap for accounting standard reforms has been in preparation since 2020:
- Preparation Phase (2020 – 2021): Establishing legal frameworks, guidance documents, training personnel, and raising awareness about IFRS.
- Voluntary Application Phase (2022 – 2024): Allowing eligible companies, particularly FDI and listed firms, to adopt IFRS voluntarily, gaining experience for broader implementation.
- Mandatory Application Phase (from 2025): IFRS becomes the required accounting standard for listed companies, FDI firms, and large enterprises, ensuring financial transparency and international integration.
Meanwhile, smaller enterprises (SMEs) must familiarize themselves with and integrate these new standards, leading to:
- A gradual transition from Vietnam Accounting Standards (VAS) to IFRS-based accounting practices.
- Challenges in securing skilled accounting professionals as traditional practices prioritized minimal compliance or financial embellishment for bank loans rather than corporate-level financial management.
- Opportunities and threats: SMEs and private enterprises face growing competition, requiring adaptation to international financial standards to sustain domestic and export market growth while improving management capabilities.
- Finance and accounting as core business functions: By 2025, founders must recognize financial governance as a fundamental aspect of business sustainability and legal accountability.
- The demand for skilled accountants and CFOs: While founders seek proficient accountants, challenges persist in finding professionals who combine expertise with leadership, regulatory understanding, and compliance adaptability.
- The trend of accountants establishing independent firms, creating a gap between business owners and accounting professionals due to misaligned perspectives and decision-making approaches.
- Building an effective accounting team capable of internal reporting, tax compliance, financial decision-making, and strategic planning remains a significant challenge for production-focused founders.
- Unified internal accounting records: Merging financial books into a single, coherent system remains a major hurdle for Vietnamese enterprises amid tightening regulations.
Equitix’s In-House Product: Coaching & Consulting
Nature of Service:
- A blend of comprehensive training and hands-on consulting to build a solid accounting framework.
Implementation Roadmap:
- Assessment: Diagnosing the enterprise’s financial and accounting health.
- Reporting & Readiness Evaluation: Assessing the company’s preparedness for a professional accounting and finance department.
- Training:
- Financial knowledge for business owners: The role of the Board of Directors and shareholders.
- Accounting knowledge for employees and managers.
- Recruitment & Team Structuring:
- Defining project objectives.
- Establishing salary frameworks for each accounting role.
- Creating Job Descriptions (JDs), Balanced Scorecards (BSCs), and Key Performance Indicators (KPIs).
- Developing financial policies aligned with revenue scale and organizational structure.
- Participating in recruitment and competency assessment with accountants and business owners.
- Professional Accounting Advisory (VAS-compliant):
- 20 years of legal expertise, keeping up with Ministry of Finance directives.
- Constructing financial structures, including cost and pricing strategies from an accounting, tax, business, and marketing perspective.
- Optimizing tax deductions and compliance with personal income tax (PIT) and corporate tax regulations.
- Registering promotional programs with the Ministry of Industry and Trade for tax-deductible expenses.
- Industry-specific cost allocation strategies based on legal guidelines.
- Advisory for self-management.
- Full-service accounting support by Equitix experts, leveraging 20+ years of experience in regulatory compliance.
II. TAX SETTLEMENT SEASON – INSIDER INSIGHTS FROM EQUITIX INVESTING
Perspective: Tailored for founders and business owners.
Basis: Direct experience with tax authorities in Ho Chi Minh City and Hanoi.
From 2025, tax authorities have implemented decisive measures to enforce financial transparency and compliance. Equitix perceives this as a market purification trend, encouraging founders to establish solid financial practices and scale sustainably.
Adapting to this shift requires time and a proactive approach. These insights are drawn from years of consulting discussions with companies across various industries.
Corporate Tax Compliance – Reality Check:
- Delayed tax compliance leads to hefty fines: Businesses often only react when faced with tax audits, leading to retroactive tax assessments far exceeding actual revenues.
- Self-settled tax reports increase risk of arbitrary tax assessments: The tax authority may impose predefined tax amounts rather than allowing self-declared figures.
- Over-reliance on external accounting services can lead to legal liabilities: Business owners remain legally responsible for tax mismanagement.
- Tax risk is unpredictable, making proactive tax planning essential for business continuity.
- Late tax filings result in penalties ranging from $10,000 to $12,000 (VND 250 – 300 million).
- Unverified transactions across multiple accounts may raise compliance issues.
- Poor tax reporting and inadequate bookkeeping increase financial risks.
- Transactions among related parties can trigger in-depth tax investigations.
Equitix’s Insights on Tax Authority Practices:
- Automated risk classification:
- Red Flag: Immediate audit priority.
- Yellow Flag: Under surveillance.
- Green Flag: Low risk, but no guarantee of avoiding audits.
- Thematic tax audits: Industries are targeted periodically, ensuring eventual scrutiny.
- Blacklisted businesses: Tax authorities use national ID and banking credit history (CIC) for enforcement.
- Unmonitored bank transactions can affect loan eligibility due to tax-related blacklisting.
- Intercompany transactions between related entities attract regulatory attention.
- Crackdown on transfer pricing and invoice manipulation: Businesses engaging in artificial cost structuring face penalties.
- Chronic losses raise red flags: The tax office will inquire about long-term operational viability.
How Equitix Supports Founders:
- Developing tax strategies & compliance frameworks.
- Implementing structured tax planning, covering monthly, quarterly, and annual filings.
- Ensuring accurate bookkeeping and timely reporting.
- Managing tax audits and compliance assessments.
- Structuring corporate finances for optimal tax efficiency.
III. PRICING STRUCTURE:
- Training fees
- One-time setup cost
- Ongoing monthly maintenance fees
- Management fees
- Additional costs
Contact Equitix today:
📩 founder.ffp100@equitixinvesting.com or lien.vu@equitixinvesting.com
#Equitix