ANNUAL REPORT 2024
TOGETHER IN BELIEF, LEADING IN INNOVATION
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Basis of preparation
Summary of significant accounting policies
Cash Cash comprise cash on hand, cash in banks.
Accounting standards and system The consolidated financial statements of the Group, expressed in Vietnam dong (“VND”), are prepared in accordance with Vietnamese Enterprise Accounting System and Vietnamese Accounting Standards issued by the Ministry of Finance as per: Decision No. 149/2001/QD-BTC dated 31 December 2001 on the Issuance and Promulgation of Four Vietnamese Accounting Standards (Series 1); Decision No. 165/2002/QD-BTC dated 31 December 2002 on the Issuance and Promulgation of Six Vietnamese Accounting Standards (Series 2); Decision No. 234/2003/QD-BTC dated 30 December 2003 on the Issuance and Promulgation of Six Vietnamese Accounting Standards (Series 3); Decision No. 12/2005/QD-BTC dated 15 February 2005 on the Issuance and Promulgation of Six Vietnamese Accounting Standards (Series 4); and Decision No. 100/2005/QD-BTC dated 28 December 2005 on the Issuance and Promulgation of Four Vietnamese Accounting Standards (Series 5).
Accordingly, the accompanying consolidated financial statements, including their utilization are not designed for those who are not informed about Vietnam’s accounting principles, procedures and practices and furthermore are not intended to present the consolidated financial position and the consolidated results of operations and the consolidated cash flows of the Group in accordance with accounting principles and practices generally accepted in countries other than Vietnam.
Inventories Inventories are measured at their historical costs. The cost of inventories comprises costs of purchase, costs of conversion (including raw materials, direct labor cost, other directly related cost, manufacturing general overheads allocated based on the normal operating capacity) incurred in bringing the inventories to their present location and condition.
In case the net realizable value is lower than the original price, it must be calculated according to the net realizable value. Net realizable value represents the estimated selling price in the ordinary course of business less the estimated costs to complete and the estimated costs necessary to make the sale. The perpetual method is used to record inventories, which are valued as follows:
Materials, tools and supplies and merchandise
Cost of purchase on a weighted average basis.
Work in process and finished goods
Cost of direct materials and labor plus attributable manufacturing overheads based on the normal operating capacity on a weighted average basis. An inventory provision is made for the estimated loss arising due to the impairment of value (through diminution, damage, obsolescence, etc.) of raw materials, finished goods, and other inventories owned by the Group, based on appropriate evidence of impairment available at the balance sheet date. When inventories are expired, obsolescence, damage or become useless, the difference between the provision previously made and the historical cost of inventories are included in the consolidated income statement. Increases or decreases to the provision balance are recorded into the cost of goods sold account in the consolidated income statement. Receivables are presented in the consolidated balance sheet at the carrying amounts due from customers and other debtors, after provision for doubtful debts. The provision for doubtful debts represents amounts of outstanding receivables at the balance sheet date which are doubtful of being recovered. Increases or decreases to the provision balance are recorded as general and administrative expense in the consolidated income statement. When bad debts are determined as unrecoverable and accountant writes off those bad debts, the differences between the provision for doubtful receivables previously made and historical cost of receivables are included in the consolidated income statement.
Applied accounting documentation system The Group’s applied accounting documentation system is the General Journal system.
Provision for obsolete inventories
Accounting currency The consolidated financial statements are prepared in VND which is also the Group’s accounting currency. Basis of consolidation Fiscal year The Group’s fiscal year applicable for the preparation of its consolidated financial statements starts on 1 January and ends on 31 December.
Receivables
All intra-company balances, income and expenses and unrealized gains or losses resulted from intra-company transactions are eliminated in full. Impact of change in the ownership interest of a subsidiary, without a loss of control, is recorded to the account of undistributed earnings or accumulated losses.
The consolidated financial statements comprise the financial statements of the Company (the parent company) and its subsidiaries for the year ended 31 December 2024. Subsidiaries are fully consolidated from the date of acquisition, being the date on which the Group obtains control, and continued to be consolidated until the date that such control ceases. The financial statements of subsidiaries are prepared for the same reporting year as the parent company, using consistent accounting policies.
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