Many companies in Vietnam notice that local accounting numbers and group reporting numbers do not always match.
In most cases, this is not an accounting error — it is simply the result of differences between Vietnam Accounting Standards (VAS) vs International Financial Reporting Standards (IFRS)
Understanding this difference helps finance teams explain reporting gaps more clearly during month-end closing, audit reviews, and HQ reporting.
1. Why VAS and IFRS are different
VAS is mainly used for statutory accounting, tax filing, and local financial reporting in Vietnam.
IFRS is designed for global financial reporting, investor transparency, and consolidated reporting across multiple countries.
VAS = Local compliance and statutory reporting
IFRS = Global reporting and financial transparency
2. Common accounting areas where differences appear
| Area | VAS | IFRS |
|---|---|---|
| Revenue Recognition | Often linked to invoice timing and legal documents | Focused on performance obligation and transfer of control |
| Lease Accounting | Often simpler local expense treatment | Recognition of right-of-use asset and lease liability |
| Provisions | Conservative recognition with tax considerations | Estimate-based depending on expected obligation |
| Depreciation | Often follows local useful life guidance | Based on economic useful life and group policy |
| Foreign Exchange | Local accounting treatment and statutory reporting basis | Often adjusted based on reporting currency and group FX policy |
3. Why financial numbers can look different
Differences usually appear because local books and group reporting follow different accounting objectives.
The local finance team may prepare figures correctly under VAS, while HQ adjusts those same figures again under IFRS for consolidation purposes.
4. Practical impact for finance teams
Understanding both VAS and IFRS helps finance teams:
✔ explain reporting differences to HQ more clearly
✔ reduce reconciliation issues during closing
✔ prepare cleaner reporting packages
✔ improve communication with auditors and tax advisors
✔ identify which adjustments belong to local books and which belong to group reporting
5. Final thoughts
VAS and IFRS are not competing systems.
They simply serve different reporting purposes.
For companies operating in Vietnam, understanding how the two frameworks connect is essential for accurate reporting and smoother financial communication.
VN BizLab Insight
This article is based on practical business experience in Vietnam and publicly available regulatory information. Accounting and tax treatment may vary depending on company structure, transaction type, and reporting timing. Before applying this content to actual business decisions, please review the latest regulations and consult qualified professionals.