đề án phạm phương thảo 2

NATIONAL ECONOMICS UNIVERSITY
SCHOOL OF ACCOUNTING AND AUDITING
-------***-------
ESSAY ON ACCOUNTING
TOPIC: Accounting for accounts receivable in businesses today in Vietnam
Student name: Pham Phuong Thao
Student ID: 11219317
Class: Accounting CFAB K63
Supervisor: Nguyen Ha Linh
Hanoi, 2024
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LIST OF ABBREVIATIONS
Từ viết tắt Nghĩa của từ viết tắt
TNHH Trách nhiệm hữu hạn
CP Cổ phần
TP. HCM Thành phố Hồ Chí Minh
DP Dược phẩm
PA1 Phương án 1
PA2 Phương án 2
TBYT Thiết bị y tế
GTGT Gía trị gia tăng
VAT Thuế giá trị gia tăng
PX Phiếu xuất
HTK Hàng tồn kho
CK Chuyển khoản
CTGS Chứng từ ghi sổ
DN Doanh nghiệp
BTC Bộ Tài Chính
PS Phát sinh
ĐK Đầu kỳ
CK Cuối kỳ
HĐ Hóa đơn
TK Tài khoản
PT Phiếu thu
GBN Giấy báo nợ
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Table of Contents
INTRODUCTION.....................................................................................................................................3
CHAPTER 1: OVERVIEW AND ACCOUNTING TREATMENT FOR TRADE RECEIVABLE.............................5
1.1. Overview of the trade receivable..........................................................................................5
1.1.1. The nature of trade receivable........................................................................................5
1.1.2. The characteristics of trade receivable..........................................................................6
1.1.3. The classification of trade receivable.............................................................................7
1.1.4. The valuation of trade receivable...................................................................................8
1.2. Accounting for trade receivable..........................................................................................9
1.2.1. Accounting for customer receivables............................................................................10
1.2.2. Accounting for Internal receivables..............................................................................16
1.2.3. Accounting for bad debt provisions....................................................................................22
1.2.4. Accounting for other receivables........................................................................................24
CHAPTER 2: EVALUATION AND RECOMMENDATION.........................................................................31
2.1. Evaluation of this accounting procedure in Vietnam.......................................................31
2.1.1. Advantages...................................................................................................................31
2.1.2. Disadvantages..............................................................................................................33
2.1.3. Difference between IAS and IFRS.................................................................................35
2.2. Some suggestions – recommendations to complete accounting of trade receivable............37
2.2.1. About management.............................................................................................................37
2.2.2. Account used.......................................................................................................................38
2.2.3. Vouchers and voucher circulation......................................................................................39
2.2.4. General accounting books..................................................................................................39
2.2.5. Conditions for implementing the solution...........................................................................39
CONCLUSION........................................................................................................................................40
REFERENCE...........................................................................................................................................41
APENDIX...............................................................................................................................................41
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INTRODUCTION
When examining financial statements, investors frequently focus on revenue, net
income, and earnings per share. Even if looking into a company's earnings and sales is the
best way to get a general idea of how financially stable it is, looking into accounts receivable
allows us to go a little deeper.
Trade receivable is essentially a way to quantify how much a customer owes a business
for goods or services rendered. A significant amount of a business's current assets are trade
receivables, which are also an essential source of working capital. Through trade receivables
inquiry, firms assess the credit risk of their customers critically.
Understanding a customer's creditworthiness and capacity to fulfill their payment

obligations is the key reason for analyzing trade receivables. Through this analysis, firms can
evaluate the degree of risk associated with delivering goods and services on credit and
determine appropriate credit limits for clients. Understanding the credit risk associated with
trade receivables is essential for maintaining a healthy balance between sales growth and risk
management.
Additionally, trade receivables analysis yields useful data for cash flow management
and monitoring. Businesses can forecast more accurately and plan for incoming cash by
looking at account aging and spotting patterns in payment behavior. This helps them make
sure there are enough funds to cover operating costs and investment requirements.
A thorough examination of trade receivables enables companies to assess how well their
credit guidelines and collection practices are working. Businesses can increase cash flow and
lower bad debts by streamlining their credit management procedures, detecting past-due
accounts, and customizing their collection tactics.
Furthermore, decision-making and financial reporting depend on the analysis of trade

receivables. Giving investors, creditors, and analysts trustworthy information requires
accurate trade receivable valuation and disclosure in financial statements. Furthermore, trade
receivables research can provide valuable information that informs strategic choices about
credit terms, sales terms, and customer relations—all of which ultimately support the stability
and expansion of the company as a whole.
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To sum up, trade receivables research is essential to developing a thorough grasp of
cash flow management, credit risk, and the efficiency of credit and collection processes.
Businesses may improve their working capital efficiency, make well-informed decisions, and
maintain and improve their financial stability by looking into trade receivables.
I chose the research topic of "Accounting for trade receivable in businesses today in
Vietnam" after realizing the significance of trade receivable accounting.
My essay is divided into 3 parts:
Part 1: Introduction
Part 2: Research about trade receivable
Chap 1: Overview and accounting treatment for trade receivable
Chap 2: Evaluation and recommendation
Part 3: Conclusion
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CHAPTER 1: OVERVIEW AND ACCOUNTING TREATMENT FOR TRADE
RECEIVABLE
1.1. Overview of the trade receivable
1.1.1. The nature of trade receivable
According to Vietnamese Accounting Standards (VAS), trade receivables are considered as

assets resulting from sales of goods or provision of services to customers on credit terms.
They represent amounts owed to the reporting entity by its customers for goods sold or
services rendered in the ordinary course of business.
The nature of trade receivables under VAS typically includes:
- Normal Business Operations: Trade receivables arise from the primary revenue-
generating activities of the entity, reflecting sales made on credit terms as part of its
normal business operations.
- Short-term in Nature: Trade receivables are generally expected to be collected within a
short period, usually within one year, and are classified as current assets on the
balance sheet.
- Credit Sales: They result from credit sales transactions where goods or services have
been delivered to customers, but payment has not yet been received.
- Measurable: Trade receivables are usually measured at the invoiced amount, which is
the consideration agreed upon between the entity and its customers for the goods sold
or services provided.
- Interest-Free: Unless explicitly stated, trade receivables typically do not carry any
interest charges. However, if there is an implicit interest element, such as offering
extended payment terms, appropriate adjustments may be required.
- Subject to Impairment: VAS requires entities to assess trade receivables for
impairment regularly. An impairment loss is recognized when there is objective
evidence that the receivable is impaired, such as the financial difficulty of the debtor
or the likelihood of non-payment.
Understanding the nature of trade receivables is vital for businesses in managing their
working capital, assessing financial performance, and ensuring the sustainability of their
operations.
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1.1.2. The characteristics of trade receivable
- Short-term Nature: Trade receivables are typically expected to be collected within a
relatively short period, often within 30 to 90 days, making them a short-term asset on a
company's balance sheet.
- Credit Risk: There is an inherent credit risk associated with trade receivables, as there
is always a chance that some customers may default on their payments. Companies
often perform credit checks or use credit insurance to mitigate this risk.
- Collection Period: The collection period for trade receivables is an important metric
for managing cash flow and liquidity. Companies aim to minimize the collection
period to ensure a steady inflow of cash.
- Discounting Options: Companies may choose to discount their trade receivables by
selling them to a third party at a discount in order to receive immediate cash, though
this comes at a cost.
- Non-Interest Bearing: Trade receivables are usually non-interest bearing, meaning that
the customer is not charged interest for the credit period unless specifically stated in
terms of the sale.
- The impact on Financing and Operations: Trade receivables affect the company's
working capital and financing needs. Efficient management of trade receivables is
essential to support ongoing operations and growth.
- Accounting Treatment: Trade receivables are recorded as assets on the balance sheet at
their net realizable value, which accounts for any expected losses due to non-payment.
These characteristics underline the importance of effective management and monitoring of

trade receivables for a company's financial health.
1.1.3. The classification of trade receivable
The receivables include: Customer receivables, internal receivables, and other receivables.
- Customer receivables: Customer receivables are commercial receivables arising from

transactions of a commercial nature, such as sales transactions. Customer receivables may
include receivables from sales of goods, provision of services, financial investments,
proceeds from the export of entrusted goods through the consignee, liquidation, and sale
of fixed assets, etc.
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- Internal receivables: Internal receivables are amounts between the superior entity and
subordinate entities that do not have legal personality and are not accounted for
independently.
- Other receivables: Other receivables encompass non-commercial receivables unrelated to
buying and selling transactions or service provision. For example:
 Third-party expenses reimbursable; Receivables for exported goods on behalf of
the principal;
 Loans of assets, receivables for fines, compensation, assets pending disposal;
 Receivables from financial activities: Interest income from loans, dividends and
profits, deposits.
According to Vietnamese Accounting Standards (VAS), trade receivables are typically

classified as follows:
- Current Assets: Trade receivables are generally classified as current assets on the
balance sheet if they are expected to be realized or settled within the normal operating
cycle of the business, usually within one year from the reporting date. They are
included in the current assets section alongside other assets like cash, inventory, and
prepaid expenses.
- Non-Current Assets (in some cases): If trade receivables are expected to be realized or
settled beyond the normal operating cycle or one year from the reporting date, they
may be classified as non-current assets. This classification typically applies to long-
term trade receivables or those with extended payment terms.
- Allowance for Doubtful Debts (Impairment): VAS requires entities to assess the
collectibility of trade receivables regularly and recognize impairment losses when
there is objective evidence of impairment, such as the financial difficulties of the
debtor or the likelihood of non-payment. The allowance for doubtful debts is deducted
from the gross trade receivables to arrive at the net realizable value that is reported on
the balance sheet.
- Disclosure: VAS also prescribes disclosure requirements related to trade receivables in
the financial statements. This includes information about the aging of receivables,
provisions for bad debts, the nature and extent of any collateral held as security, and
any significant concentrations of credit risk.
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Trade receivables must be properly classified in order to offer information about a company's
liquidity, operational effectiveness, and any credit concerns for financial reporting and
analysis.
1.1.4. The valuation of trade receivable
The valuation of trade receivables involves assessing the amount at which they should be
reported on the balance sheet to reflect their estimated net realizable value. Here are some key
aspects of the valuation of trade receivables:
- Net Realizable Value: Trade receivables are normally recorded at their net realizable
value on the balance sheet. This is the approximate amount that is anticipated to be
received from clients after deducting any possible losses resulting from nonpayment.
The receivables are reported at a prudent and reasonable level.
- Allowance for Doubtful Accounts: Also known as a provision for bad debts, this kind
of account is created by companies to protect themselves against potential losses
brought on by nonpayment. This allowance is based on several relevant factors,
including the consumer's creditworthiness, the economy, and history of bad debt. It
shows the quantity of receivables that the business does not anticipate having
collected.
- Aging Analysis: An aging analysis, which classifies receivables according to how long
they have been outstanding, is frequently performed as part of the valuation of trade
receivables. This research offers insights into the company's success in collecting
money and aids in evaluating the allowance for questionable accounts.
- Write-offs: A trade receivable's write-off from accounts receivable and related
allowance for doubtful accounts occurs when a business decides a particular trade
receivable is uncollectible. This guarantees that the balance sheet presents the most
recent data and represents the appropriate value of trade receivables.
- Fair Value Option: Although it is less typical for trade receivables in most industries,
organizations may occasionally decide to measure trade receivables at fair value using
profit or loss.
In general, controlling credit risks, evaluating the efficacy of credit rules, and providing a
realistic view of a company's financial status all depend on the value of trade receivables.
Businesses use best practices and accounting standards to help them determine how much to
value trade receivables.
1.2. Accounting for trade receivable
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- The accounting treatment of customer receivables necessitates a thorough understanding
of outstanding balances, sales policies, and international payment procedures. It is
imperative to regularly compile reports detailing the status of customer receivables, with
special attention given to reconciling accounts for frequent clients at the end of reporting
periods.
- While customer receivables typically reflect debit balances, exceptions may occur where
credit balances are present, particularly with certain customers. During the preparation of
financial statements, it is essential to utilize detailed account balances to accurately
categorize receivables under both "Assets" and "Sources of Funds" in the balance sheet.
- Maintaining precise records of customer receivables, including details such as payment

terms and discounts, is vital for effective accounting practices.
- Additionally, accounting personnel should promptly verify or request written confirmation

for long outstanding and doubtful receivables to facilitate the establishment of provisions
for potential bad debts.
1.2.1. Accounting for customer receivables
1.2.1.1 Accounting documents
Transactions generating receivables are tracked through original accounting documents:
a) VAT invoice
b) Regular sales invoice
c) Receipt (if payment is made by cash)
d) Delivery note
e) Bank Credit Notice (if payment is made by transfer)
f) Record of debt clearing (if payment is made by debt clearing)
g) Detailed customer tracking book
The accounting records will explicitly indicate the amount owed when receivables occur. A
customer's receivables will be decreased if they pay. Receipts are a common tool used by
many firms to document transactions
1.2.1.2 Accounting rules for trade receivable
a) This account is used to track receivables and payments made to customers for
commodities, fixed assets, investment properties, financial investments, or services. This
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account also records receivables from contract awardees and contractors on the finished
infrastructure work. This account does not record immediate cash transactions.
b) For every entity and item, a particular record of all customer receivables must be
kept, and recovery terms (greater than or equal to 12 months from the reporting date) must be
closely watched. All payments must also be documented. Receivable entities are clients that
do business with the company for fixed assets, investment property, services, purchases of
goods, or other financial investments.
c) In accordance with standard sales or service transactions, the export trustee shall
record receivables for the sale of exported goods from the export trustor to the
aforementioned account.
d) The debts will be categorized as coverable, dubious, or bad when this account is
recorded in order to decide on provisions for dubious debts or bad debt remedies.
e) Customers may ask the business to reduce the price of the items or refund those that
they have received if the products, real estate, or services are provided in a manner that
deviates from the conditions of the contracts that the company has with its clients.
f) The company must monitor all consumer receivables in all currencies. Foreign
currency receivables need to follow these rules:
- Trade receivables (Dr. 131) must be converted into Vietnamese Dong at the time of
generating, in accordance with the commercial bank's purchase rates at the time the clients
clear their debts, as per the current exchange rates. When the requirements for revenue
recognition are satisfied, Dr. 131 will apply the specified identifying bookkeeping rate to
the advance that was received from the buyers.
- Trade receivables (Cr 131) must be recovered by the accountant, who must then convert
them into Vietnamese Dong (VND) following each type of debtor's actual bookkeeping
rate (if the debtors engage in several transactions, the actual bookkeeping rate must equal
the weight average rate applicable to those transactions). The Cr 131 shall apply actual
exchange rates (the rate reported to the Debit account - Cash) at the moment of receipt of
advances received from buyers.
- Trade receivables denominated in foreign currencies must be reevaluated by the business
at intervals when the required financial statements are prepared. The real exchange rates
that apply to the revaluation of trade receivables are the commercial bank's foreign
currency-buying rates, which are selected by the company while creating financial
statements. If the company transacts with multiple banks and has a range of receivables, it
can choose the buy rate of any one of those commercial banks. Units within the group are
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required to apply a single rate determined by the parent company when reevaluating trade
receivables derived from foreign currencies emerging from internal group transactions,
provided that this rate is close to the real exchange rates.
1.2.1.3 Accounts used
The account used is Account 131
The accounting account 131 is structured as follows:
Debit:
- Trade receivables generated from the sale of products, investment property, fixed assets,
services, or financial investments that are generated within the tax period;
- Extra cash owed to clients.
- Revaluation of receivables denominated in foreign currencies (should the exchange rate
rise relative to Vietnamese Dong).
Credit:
- Customers' repayment;
- Advances from customers.
- Customer discounts are given following the receipt of products and the filing of
complaints.
- Sales of returned goods (VAT included or not).
- The total amount of trade and payment discounts provided to buyers.
- Revaluation of Foreign currency receivables (if the foreign currency rates decline against
VND).
Debit balance: Remaining trade receivables.
This account may have a credit balance
Credit balance: according to each unique entity, this records quantities of advance or collected
that exceed trade receivables. It is necessary to enter the precise balance for each receivable in
this account under the "Asset" and "Equity" items when creating the balance sheet.
1.2.1.4 Accounting treatment

a) When selling goods or providing services and delaying payment, the following
accounts have to be kept on file. (including receivables from the sale of trustors'
exporting goods):
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- The following should be noted when recording the revenues from goods and services that
are tax-free with regard to investment property, goods and services, and special excise
duty, import tax, and environment protection tax (When recording, the above indirect
taxes including VAT payable using the subtraction method must be separated.):
Dr 131 – Trade receivables (total payment)
Cr 511 - Revenues (tax-exclusive prices)
Cr 333 – Taxes and other payables to the State.
- Taxes payable must be included in the revenues if it does not separate them. The
following should be noted while recording tax obligations and the decline in revenue:
Dr 511 – Revenues
Cr 333 – Taxes and other payables to the State.
b) Accounting for returned goods.
Dr 5213 – Returned goods (prices without taxes)
Dr 333 – Taxes and other payables to the State (VAT of returned goods,
clarifying each type of tax)
Cr 131 – Trade receivables.
c) Accounting for trade discounts and sales rebates
- If trade discount or sales rebate amounts are specified on invoices, then prices (recording
based on net revenues) minus aforementioned discounts and trade discount or sales rebate
amounts don't need to be separately recorded;
- The revenues shall be recorded at the prices including discounts (gross revenues) in the
event that the trade discounts or sales rebate amounts are not indicated on the invoices
because the customers are not entitled to those discounts. If consumers qualify for the
aforesaid discounts, these will be recorded separately after revenues are reported. This
way, a periodic decline in revenue will be recorded as follows:
Dr 521 – Revenue deductions (5211, 5212) (tax-exclusive prices)
Dr 333 – Taxes and other payables to the State (VAT of trade discounts or
sales rebates)
Cr 131 – Trade receivables (total amounts of discounts).
d) The following accounts must be documented for the payment discounts that are due to the
buyers, excluding receivables:
Dr 111 - Cash
Dr 112 – Cash in the bank
Dr 635 - Financial expenses (amounts of payment discounts)
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e) When customers are paid (including interest on debts) or obtain advances from them
through contracts for the sale of goods or the provision of services, the following
accounts have to be maintained on file:
Dr 111, 112, etc.
Cr 515 - Financial income (profits).
The Cr 131 must use the real exchange rates in effect at the time of receipt (the bank's
buying rates) when receiving advances in foreign currencies.
f) Accounting procedure for contractor's client receivables about building contracts:
- In case the contractor is able to pay according to the terms of the construction contract:
 If the construction contract's outcome can be accurately predicted, the following
accounts must be kept on file with records of revenues about completed work
(apart from bills), as decided by the contractor:
Dr 337 – Payment under the schedule of construction contract
Cr 511 – Revenues.
 The invoices that are provided by the schedule will serve as documentation
of the amounts that clients pay:
Dr 131 – Trade receivables.
Dr 337 – Payment under the schedule of construction contract
Cr 3331 – VAT payable (33311).
- The following accounts must be maintained on file when the results of the contract's
performance are reliably proven and confirmed by the clients, if the construction contract
specifies that the contractor will be paid according to their workload: The invoices need to
reflect the finished job and be validated:
- The following accounts must be kept on file when the contractor receives the bonus that
the customer pays them because their performance on the building contract meets or
exceeds the predetermined goal:
Dr 131- – Trade receivables.
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- The following accounts must be kept on file when collecting the money paid by clients or
other contracting parties to cover expenses that are not included in the contract's value
(customer errors or delays, as well as disagreements over modifications to the contract's
performance)
- The following accounts must be noted when collecting money from clients for completed
services or advances:
Dr 111, 112, etc.
g) In case the client chooses to pay with goods rather than cash (through barter), the value of
the materials or exchanged goods (based on the fair value indicated in the VAT invoice or
sales invoice of the client) will be subtracted from the client's debt receivables, and the
following accounts will be noted:
Dr 152 - Materials
Dr 153 - Tools
Dr 156 - Goods
Dr 611 – Good purchases (inventory accounted by periodical verification
method)
Dr 133 – Deductible VAT (if any)
h) The following accounts must be noted when dubious debts that are not recoverable
based on the debt relief report are eliminated:
Dr 229 – Provision for asset losses (2293) (amounts of provision)
Dr 642 – Enterprise administrative expenses (amounts of non-provision)
i) The following accounts must be kept on file when entrustment fees are collected from
the export/import trustees:
Cr 511 – Revenues (5113)
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j) The outstanding debt in foreign currencies of customers must be assessed during the
preparation of financial statements using the actual exchange rates in effect at the time
of preparation:
 The following accounts must be registered if foreign exchange rates increase
relative to VND rates:
Cr 413 – Exchange rate differences (4131).
 The following accounts must be registered if foreign exchange values decline
relative to VND rates:
Dr 413 – Exchange rate differences (4131).
1.2.1.5. Accounting ledger
- Detail ledger of accounts receivable, general accounting ledger
1.2.2. Accounting for Internal receivables

- Goods delivery note
- Value Added Tax (VAT) invoice, sales invoice
- Receipt voucher, payment voucher
- Debt offset agreement
a) The connection between the company and its subsidiary entities or between the subsidiaries
of an autonomous enterprise. In this scenario, subsidiary units refer to entities lacking legal
autonomy but possessing dependent accounting structures, including branches, subsidiaries,
project management boards, and similar entities that are under the control of the enterprise.
b) The payment interactions between the company and its subsidiaries, branches, and other
similar entities, which operate as legal entities with autonomous accounting systems, are not
accounted for within this ledger. Instead, they are managed similarly to transactions involving
subsidiaries.
c) The contents of internal receivables reflected in account 136 include:
- For superior enterprises:
o Funds, capital, or budget allocations provided to subordinate entities.
o Required amounts by subordinate entities to remit to the parent company as per
regulations.
o Funds collected by subordinate entities on behalf of the parent company.
o Expenses or payments made on behalf of subordinate entities.
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o Allocations to subsidiary units for internal exchanges and compensation for
internal exchange value.
o Miscellaneous receivables.
- For subordinate units without legal personality and dependent accounting:
o Allocations made by the parent company but not yet received.
o Value of products, goods, or services transferred to the parent company or
other internal units for sale.
o Revenues generated from sales or services provided to internal units.
o Funds collected by the parent company or other internal units on behalf of the
subordinate.
o Expenses or payments made on behalf of the parent company and other
internal units.
o Other miscellaneous internal receivables.
dAccount 136 requires detailed breakdowns for each subsidiary unit with payment
connections, and it must individually monitor each internal receivable. The company must
implement measures to prompt the resolution of internal receivables within the accounting
period.
e)At the conclusion of the accounting period, it's essential to validate, reconcile, and affirm
the transactions and balances recorded in account 136 "Internal Receivables" and account 336
"Internal Payables" with subordinate units based on each payment category. Payment offsets
should be executed for each category concerning every relevant subordinate unit, with
offsetting entries carried out on both account 136 "Internal Receivables" and account 336
"Internal Payables" (specified for each entity). Any inconsistencies discovered during
reconciliation must be identified and promptly rectified.
The account used is account 136.
The structure of accounting account 136 is as follows:
Debit Side:
- Provision of capital to subordinate units;
- Allocation of investment capital to Project Management Boards (PMBs); Other entries
made to increase the investor's receivables from PMBs;
- Payments made on behalf of the superior enterprise or internal units;
- Receivables from the superior enterprise and amounts to be transferred by subordinate
units;
- Receivables from subordinate units and amounts to be remitted by the superior
enterprise;
- Receivables for products, goods, or services exchanged between internal units.
- Miscellaneous internal receivables.
Credit Side:
- Retrieval of capital or funds from subordinate units;
- Settlement with subordinate units regarding allocated and utilized project funds;
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- Value of completed fixed assets transferred from PMBs; Other entries made to
decrease the investor's receivables from PMBs;
- Amounts already received for internal receivables;
- Offsetting receivables against payables within the same internal entity.
Debit Balance: Remaining receivables within internal units.
Account 133 - Value Added Tax (VAT) Deductible has 2 sub-accounts:
- Account 1331 - VAT Deductible on Goods and Services
- Account 1332 - VAT Deductible on Fixed Assets
* At subordinate units without legal personality and dependent accounting:
a) When making payments or disbursements for the superior enterprise and other internal
units on their behalf:
Dr Account 136 - Internal Receivables (1368)
Cr Accounts 111, 112.
b) According to the announcement issued by the superior enterprise regarding the allocation
of funds for rewards and benefits, record:
Cr Account 353 - Rewards and Benefits Fund.
c) Depending on the operational characteristics and hierarchical structure of each unit, when
selling products, goods, or providing services to internal units within the enterprise:
For subordinate units with dependent accounting that recognize revenue, record:
Cr Account 511 - Sales Revenue and Service Provision (internal sales transaction)
Cr Account 333 - Taxes and State Dues.
At the same time, document the expenses related to the sold goods., record:
Dr Account 632 - Cost of Goods Sold
Cr Accounts 154, 155, 156.
For subordinate units with dependent accounting that do not acknowledge revenue, the worth
of products, items, or services supplied internally is registered as internal receivables, record:
Cr Accounts 154, 155, 156
Cr Account 333 - Taxes and State Dues.
d) When receiving payments in the form of money, materials, or assets from the superior
entity or other internal units to settle receivables, record:
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Dr Accounts 111, 112, 152, 153,...
Cr Account 136 - Internal Receivables (1368).
e) Offsetting internal receivables against internal payables within the identical entity, record:
Dr Account 336 - Internal Payables (3368)
* Accounting at the superior enterprise:
a) When the parent company allocates business capital to subordinate units lacking legal
personality and operating with dependent accounting:
In case of providing capital in the form of cash, record:
Dr Account 1361 - Business capital at subsidiary units
If capital is provided in the form of fixed assets, record:
Dr Account 136 - Internal receivables (remaining value of fixed assets) (1361)
Dr Account 214 - Depreciation of fixed assets (depreciation value of fixed assets)
Cr Account 211 - Tangible fixed assets (original cost).
b) When subordinate entities lacking legal status and employing dependent accounting receive
business capital directly from the State Budget, as authorized by the parent enterprise, upon
reception, the superior enterprise records:
Dr Account 136 - Internal receivables (1361)
Cr Account 411 - Owner's investment capital.
c) When the parent company assigns project funds to its subordinate units, record:
Cr Accounts 111, 112, 461,...
d) Upon receiving funds from the subordinate units without legal personality and dependent
accounting, which are required to return business capital to the superior enterprise, record:
Dr Accounts 111, 112,....
Cr Account 136 - Internal receivables (1361).
e) Using information provided by the dependent accounting unit regarding the business
capital submitted to the State Budget under the authorization of the superior entity, record:
Dr Account 411 - Owner's investment capital
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f) Depending on the operational characteristics and hierarchical structure of each unit within
the enterprise, revenue recognition may occur either upon the transfer of goods or services to
dependent accounting units or when these units sell goods or provide services externally.
In case the enterprise records revenue upon transferring goods or services to dependent
accounting units, record:
Cr Account 511 - Sales revenue and service provision (internal sales transaction)
Cr Account 333 - Taxes and state remittances.
In case the enterprise does not recognize revenue at the time of transferring goods or services
to dependent accounting units:
Upon transferring goods or services, record:
Cr Account 333 - Taxes and state remittances (if any).
When the dependent accounting unit notifies that it has utilized products, goods, or services to
third parties external to the enterprise, record revenue:
Cr Account 511 - Sales revenue, service provision.
At the same time record cost of goods sold:
Dr Account 632 - Cost of goods sold
g) Receivables for earnings from production, commercial endeavors, and other operations at
subordinate entities:
Cr Account 421 - Undistributed profit.
h) When making payments or disbursements on behalf of subordinate units lacking legal
personality and operating under dependent accounting:
Cr Accounts 111, 112,....
i) Upon receiving payments for business interest from subordinate units and settling payments
made on their behalf, record:
Dr Accounts 111, 112,...
20
k) Offsetting internal receivables against internal payables within the same entity, record:
Dr Account 336 - Internal payables (3368)
* Accounting at the Investor with Established Project Management Boards (PMBs)
a) When the investor makes the decision to assign investment funds in the form of cash,
materials, or fixed assets to the Project Management Boards (PMBs)., record:
Dr Account 214 - Depreciation of Fixed Assets
Cr Account 211 - Tangible Fixed Assets.
b) Interest earned on bank deposits that are temporarily unused for investment by the PMBs
and subsequently transferred to the Investor, record:
Cr Account 515 - Financial Activities Revenue.
c) The investor includes eligible borrowing costs as part of the project value for the PMBs,
thereby incorporating them into the construction investment expenses., record:
Cr Accounts 111, 112, 242, 335.
d) Upon receipt of revenue, financial activity revenue, or other income from the PMBs,
record:
Dr Account 136 - Internal Receivables (1362, 1368)
e) When the PMBs transfer the input VAT incurred from purchasing raw materials, fixed
assets, equipment, or services for the investment project to the Investor for deduction, record:
Dr Account 133 - Deductible Input VAT
f) Upon receiving the cost of services rendered, financial expenditures, or others transferred
by the PMBs, record:
Dr Accounts 632, 635, 811
Cr Account 136 - Internal Receivables (1362, 1368).
g) When the project is finished and the construction is handed over, the investor's financial
records:
21
When receiving completed and settled construction works, the investor acknowledges the
value of the construction as the agreed-upon price, record:
Dr Accounts 111, 112, 152, 153, 211, 213, 217, 1557
Dr Account 133 - Deductible Input VAT (if any)
Cr Account 136 - Internal Receivables (1361)
Cr Accounts 331, 333, ... (payable accounts if any).
When the construction works received are not yet settled, the investor acknowledges the
provisional value of the construction. Upon settlement, the value of the construction needs to
be adjusted to the settled price, record:
If the settled price is higher than the provisional value, record:
Dr Accounts 211, 213, 217, 1557
Cr relevant accounts.
If the settled price is lower than the provisional value, record:
Dr relevant accounts
Cr Accounts 211, 213, 217, 1557.
1.2.3.5. Accounting Ledger
- Detailed internal receivables ledger, comprehensive accounting ledger
1.2.3. Accounting for bad debt provisions

- Economic contracts, loan agreements, debt commitments...
- The establishment or reversal of provisions for challenging receivables should occur
during the financial statement preparation.
o When the need arises to establish a provision for challenging receivables at the
end of the accounting period, surpassing the existing provision balance, the
excess is added to the provision and recognized as an increase in enterprise
management expenses.
o Conversely, if the requirement arises to establish a provision for challenging
receivables at the end of the accounting period, falling short of the existing
provision balance, the smaller difference is reversed, resulting in a reduction in
the provision and acknowledged as a decrease in enterprise management
expenses.
- The enterprise must foresee potential losses or overdue durations of receivables and
create provisions, backed by substantiating evidence. Following the creation of
provisions for each challenging receivable, the enterprise amalgamates all provisions
22
into a comprehensive schedule to serve as the foundation for expense accounting
within the enterprise.
- Regarding acquired receivables, the maximum provision equals the amount expended
by the enterprise to procure the receivable, with the maximum provisioning period not
surpassing the enterprise's restructuring duration, the debt recovery timeline specified
in the acquisition plan, or the debt resolution period.
- The enterprise refrains from establishing provisions for overdue receivables stemming
from profits or dividends derived from investments in other enterprises.
- In cases where receivables have lingered unresolved for numerous years despite
exhaustive collection endeavors, and it is concluded that the debtor genuinely lacks the
capacity to repay, the enterprise may consider either selling the receivables to debt-
buying entities or removing the challenging receivables from the accounting ledger.
- The elimination of challenging receivables must adhere to legal regulations and the
provisions outlined in the enterprise's articles of association. These receivables are
monitored within the enterprise's management system and disclosed in the financial
statements.
- If, subsequent to writing off the receivables, the enterprise successfully recovers the
previously written-off receivables, the collected amount is recorded under account 711
"Other Income".

Account used is account 2293
The structure of account 2293 is as follows:
Debit side
- Reversal of the difference between the provision required to be established in this
period, which is less than the provision already set up in the previous period and has
not been fully utilized.
- Offsetting the value of investment in another entity when there is a decision to use the
established provision to offset incurred losses.
- Offsetting the portion of the value that has been provisioned for irrecoverable debts,
which must be written off.
Credit side:
- Provision for asset impairment at the time of preparing the financial statements.
a) During the compilation of financial statements, if the provision required for difficult-to-
recover receivables in the current accounting period surpasses the provision allocated in the
previous period, which remains partially unused, additional provision is made by accounting
to cover the disparity, record:
Dr Account 642 - Enterprise Management Expenses
Cr Account 229 - Provision for Asset Impairment (2293).
23
b) If it is less than that, the accounting reverses the differential portion, record:
Dr Account 229 - Provision for Asset Impairment (2293)
Cr Account 642 - Enterprise Management Expenses.
c) Regarding receivables deemed uncollectible, accounting practices debt write-off in
accordance with prevailing legal statutes. Subsequently, following the decision to write off
the debt, the accounting entries are made, record:
Dr accounts 111, 112, 331, 334… (portion to be compensated by individuals or
organizations)
Dr Account 229 - Provision for Asset Impairment (2293) (portion already provisioned)
Dr Account 642 - Enterprise Management Expenses (portion accounted for in
expenses)
Cr accounts 131, 138, 128, 244…
d) For receivables previously deemed difficult to collect and subsequently written off but later
recovered, accounting entries are based on the actual value of the reclaimed receivable,
record:
Dr accounts 111, 112,...
Cr Account 711 - Other Income.
e) For overdue receivables sold at negotiated prices, accounting treatment varies depending on
the specific situation, and it is recorded as follows:
If overdue receivables have not been provided for as difficult-to-collect receivables, record:
Dr Accounts 111, 112 (at negotiated selling price)
Dr Account 642 - Enterprise Management Expenses (loss from selling receivables)
Cr accounts 131, 138, 128, 244…
When overdue receivables have been accounted for as difficult-to-collect receivables but the
provisioned amount is inadequate to cover the losses incurred from selling the receivables, the
residual losses are recorded as enterprise management expenses, record:
Dr Accounts 111, 112 (at negotiated selling price)
Dr Account 229 - Provision for Asset Impairment (2293) (amount already provisioned)
Dr Account 642 - Enterprise Management Expenses (loss from selling receivables)
Cr accounts 131, 138, 128, 244…
1.2.4. Accounting for other receivables
- Receipts, Payment vouchers, Debit notes, Credit notes
24
- Material inventory report, goods inventory report, fund inventory report, asset
discrepancy report, etc., authorized to be prepared in duplicate for missing or lost
assets. One accounting copy is kept as a basis for accounting entries, and the signed
copy is handed to the compensating party to receive the decision on handling.
1.2.1.2 Accounting rules
Reflecting on receivables beyond what's already recorded in the accounts receivable (accounts
131, 136) and the payment status of these receivables, including the following key points:
- The value of identified missing assets with pending determination of the cause.
- Compensation receivables for material losses caused by individuals or groups
(both internal and external to the enterprise), such as losses or damages to
materials, goods, or capital, which have been processed for compensation.
- Receivables for loans in non-monetary assets (cash loans are accounted for
under account 1283).
- Expenses related to business activities, project expenditures, investment costs,
and production and business expenses that have not been approved by
authorized entities for reimbursement.
- Recoverable expenses related to household expenditures, such as fees for
entrusted import and export, bank charges, customs inspection fees,
transportation costs, handling fees, and taxes.
- Receivables arising from the conversion of state-owned enterprises into
equitized enterprises, including equitization expenses, subsidies for laid-off
employees, and support for retraining laid-off workers in equitized enterprises.
- Interest on loans, dividends, and profits receivable from financial investment
activities.
- Other receivables not covered by the aforementioned categories.
Account 138 is used.
Structure of account 138:
Debit Side:
- The sum awaiting resolution for unaccounted assets;
25
- Amounts owed by individuals, groups (both within and outside the organization) for
confirmed missing assets with identifiable causes and promptly documented
processing;
- Outstanding amounts receivable due to obligations stemming from the restructuring of
state-owned enterprises;
- Receivables for interest on loans, deposit interest, dividends, and profits disbursed
from financial investment undertakings;
- Recoverable third-party domestic expenditures, alongside miscellaneous receivables;
- Reevaluation of receivables denominated in foreign currency (in instances where the
foreign exchange rate appreciates relative to the Vietnamese Dong).
Credit Side:
- Move the worth of unaccounted assets to corresponding accounts outlined in the

processing documentation;
- Transfer receivables linked to the privatization of state-owned businesses;
- Funds already retrieved for miscellaneous receivables.
- Reevaluation of receivables in foreign currency (if the foreign exchange rate declines
relative to the Vietnamese Dong).
Debit balance:
- Other receivables not yet collected.

- This account may have a credit balance. The credit balance reflects an amount
collected exceeding the receivables (in specific cases and in the details of each specific
entity).
Account 138 - Other Receivables has 3 sub-accounts:
- Account 1381 - Pending Resolution for Missing Assets

- Account 1385 - Receivables related to Equitization
- Account 1388 - Other Receivables
1.2.1.4 Accounting treatment for trade receivable
1. Fixed tangible assets utilized in production and business operations, identified as absent
without a clearly determined cause, awaiting resolution, record:
Dr Account 138 - Other Receivables (1381) (remaining value of fixed assets)
26
Dr Account 214 - Depreciation of Fixed Assets (depreciation value)
Cr Account 211 - Fixed Tangible Assets (original cost).
2. Tangible fixed assets utilized for business endeavors, projects, or welfare initiatives,
detected as missing without a clearly ascertainable cause, awaiting resolution, record:
Dr Account 214 - Depreciation of Fixed Assets (depreciation value)
Dr Account 466 - Source of Funds Formed for Fixed Assets (remaining value) (assets
used for business activities, projects)
Dr Account 3533 - Welfare Fund Formed for Fixed Assets (remaining value) (assets
used for welfare activities)
Cr Account 211 - Fixed Tangible Assets (original cost).
At the same time reflecting the remaining value of missing assets pending resolution, record:
Dr Account 138 - Other Receivables (1381)
Cr Account 353 - Reward, Welfare Fund (3532)

Cr Account 338 - Other Payables (Assets used for business, projects).
3. In the event of cash shortages, inventory shortages, etc., discovered during inventory
checks:
a) When the cause is not clearly identified, pending resolution, record:
Cr Accounts 111, 152, 153, 155, 156.
b) When there is an official decision on the handling of missing assets, based on the decision,
record:
Dr Account 111 - Cash (individuals, organizations paying compensation)

Dr Account 1388 - Other Receivables (individuals, organizations required to pay
compensation)
Dr Account 334 - Payables to Employees (compensation deducted from salary)
Dr Account 632 - Cost of Goods Sold (loss value of inventory after deducting
compensation according to the decision)
27
Dr Account 811 - Other Expenses (remaining value of missing fixed assets after
inventory check must be accounted for as enterprise losses)
Cr Account 1381 - Missing Assets Pending Resolution.
c) If the reason for the asset's absence is promptly identified and the accountable party is
established, the compensation is determined based on either the cause or the accountable
party, record:
Dr Account 138 - Other Receivables (1388 - Other Receivables) (compensation

amount)
Dr Account 334 - Payables to Employees (compensation deducted from salary)
Dr Account 632 - Cost of Goods Sold (loss value of inventory after deducting
compensation according to the decision)
Cr Account 621 - Direct Material Costs
Cr Account 627 - Overhead Production Costs
Cr Accounts 152, 153, 155, 156
4. Entries for temporary asset loans are recorded as follows:

Cr related accounts 152, 153, 155, 156, ...
5. Third-party household spending to be recovered, along with other receivables, are recorded
as follows:

Cr related accounts 152, 153, 155, 156, ...
6. Accounting for import-export entrusted transactions at the receiving end:
a) When the receiving party incurs expenses on behalf of the entrusting party, record:
Dr Account 138 - Other Receivables (1388) (if the entrusting party has not provided
funds)
Dr Account 3388 - Other Payables (deducted from the funds received by the entrusting
party)
Cr related accounts 111, 112, ...
28
b) When the exporting company makes offset payments with expenses incurred, the receiving
company records:
Dr Account 338 - Other Payables (3388)

Cr Account 138 - Other Receivables (1388).
c) The intricate record-keeping of import-export transactions under delegation adheres to the

directives outlined in Account 338 - Other Payables; Tax accounting for imported goods
VAT, excise tax, import tax at the entrusting and receiving ends is carried out according to the
guidelines of Account 333 - Taxes and State payments.
7. Periodically, when determining interest on loans, deposit interest, dividends, and

distributed profits, accounts receivable, record:
Dr Accounts 111, 112,... (amount already received)
Dr Account 138 – Other receivables (1388)
Cr Account 515 – Financial operating revenue
8. When receiving money from other receivables:
Dr Account 111 - Cash
Dr Account 112 - Bank Deposit
Cr account 138 - Other receivables (1388).
9. When there is a decision to handle other receivables that are deemed irrecoverable:
Dr Account 111 - Cash (compensation amount from related individuals, groups)
Dr Account 334 - Liabilities to employees (compensation amount deducted from wages)
Dr Account 229 - Provision for asset losses (2293) (if compensated by provision for
difficult-to-collect receivables)
Dr Account 642 - Enterprise management expenses (amount charged to expenses)
Cr account 138 - Other receivables (1388 - Other receivables).
10. When companies complete the procedures for transferring other receivables (currently
reflected in the balance sheet) to debt buying and selling companies, record:
Dr Accounts 111, 112 (amount received from the sale of the receivable)
29
Dr Account 229 - Provision for asset losses (2293) (difference compensated by
provision for difficult-to-collect receivables)
Dr related accounts (difference between the original value of the difficult-to-collect

receivable and the amount received from the receivable and the amount compensated by
the provision for difficult-to-collect receivables)
Credit account 138 - Other receivables (1385).
11. When expenses arise from the equitization of state-owned enterprises, record:
Dr Account 1385 - Receivables for equitization (equitization expenses details)
Cr Accounts 111, 112, 152, 331.
12. Upon concluding the equitization process, the enterprise must address all equitization-
related matters with the relevant authority. Equitization expenses, limited to severance pay,
job loss assistance, and retraining support for employees, are subtracted from the proceeds of
selling state-owned shares received from the equitization of state-owned enterprises, record:
Dr Account 3385 - Liabilities for equitization (proceeds from selling state-owned

shares)
Cr Account 1385 - Receivables for equitization.
13. Business expenses, project expenditures, investments in capital construction projects, and
production costs not sanctioned for reimbursement by authorized entities, record:
Dr Account 138 - Other receivables
Cr Accounts 161, 241, 641, 642.
14. During financial statement preparation, the foreign currency-denominated balance of other
receivables is assessed based on the prevailing exchange rate at the financial statement's time
of compilation:
- If the foreign exchange rate increases compared to the Vietnamese Dong, record:
Dr Account 138 - Other receivables
Cr Account 413 Exchange rate differences (4131).
- If the foreign exchange rate decreases compared to the Vietnamese Dong, record:
30
Dr Account 413 Exchange rate differences (4131)
Cr Account 138 Other receivables.
CHAPTER 2: EVALUATION AND RECOMMENDATION

2.1. Evaluation of this accounting procedure in Vietnam
2.1.1. Advantages
Firstly, it is suitable for the features of the Vietnamese economy and the standard of
administration of these businesses.
- VAS used the IAS system as a guide while creating accounting rules. As a result, VAS 27
has essentially moved closer to IAS 34, representing the bulk of market economy
activities and enhancing the transparency and openness of data on the financial statements
of businesses. The fundamental components of an interim summary financial report and
the criteria of recognition and evaluation that prepared and included are also outlined in
VAS 27. The timely and accurate preparation of mid-year financial reports enables
information users to more easily comprehend the capacity to create revenue streams, cash
flows, and financial situation and the solvency of the enterprise
- The Vietnam Accounting Standards System (VAS) has produced several desirable
outcomes. Vietnam has developed a set of standards that, for the most part, accurately
capture the fundamental business transactions. It's important to note how swiftly these
standards were created and released. addressing the connection between the unified
accounting system and standards first.
31
Second, about accounting work:
- The company's account system is built systematically and concisely, with details for each
item
- The accounts used are easy to remember and logical
- There is a division of items according to the actual management requirements of the
company
- The detailed circulars are quite specific about accounting work
- The company's accounting books are organized systematically, saving a lot of time and
costs
- Using the form of recording vouchers greatly reduces the number of records
- Regular accounting and the company's operational accounting design facilitate
comparison for easy
- The company organizes strict quality inspections, promptly checking everything. Check
regularly to limit errors
- Besides, the accounting team has high professional qualifications, so the accounting work
is performed successfully and accurately.
Third, regarding the classification of receivables:
- Receivables are tracked in detail by receivable term, receivable amount, receivable

currency, and other factors according to the business's management needs.
- Specific principles are followed in the classification of receivables as client, internal, and
other receivables, for example:
 Commercial receivables from sales transactions, such as those resulting from the
sale of goods, the supply of services, the liquidation of assets, and the transfer of
other assets, are included in the category of receivables from customers.
Receivables from exported copies of the entrusting party to the client via the
entrusting party are included in this receivable.
 Receivables between superior and subordinate units that do not have the legal
status of dependent accounting units are included in the category of internal
receivables.
 Other receivables consist of non-commercial receivables unrelated to sales
transactions, such as
32
 Financial revenue is generated by receivables, which include interest on
loans, deposits, dividends, and share gains.
 Amounts that the export entrusting party needs to collect on behalf of the
entrusting party, Amounts paid on behalf of the third party that are entitled
to be retrieved back,
 Non-commercial receivables include non-monetary asset loans, fines,
compensation, and unresolved missing asset cases.
Fourth for receivables in foreign currency
- Businesses maintain thorough records of receivables for foreign currency receivables

broken down by individual currency kind and container.
- Accountants are required to convert receivable debts into accounting book currency based
on the current transaction rate at the time of emergence.
- When qualified to record revenue and income, Account No. 131 corresponding to the
advance payment amount will be received in accordance with the actual recorded
exchange rate at the time of advance payment, especially in the case of receiving money
in advance from the buyer in foreign currency.
- The business can record the weighted average of receivables for each container when
collecting receivables or use the actual exchange rate in effect at the time of debt
collection.
- The Credit side of Account 131 applies the current exchange rate at the time of advance
payment in the event that the buyer makes an advance payment.
- The exchange price difference occurring within the transaction is recorded immediately at
the time of the transaction or on a regular basis if a company employs the actual
transaction term to account for accounts receivable on the credit side based on the
enterprise's management needs as well as the features of its business and manufacturing
activities. Likewise, if at the conclusion of the accounting period
 The firm must transfer all exchange rate differences that occur during the period
into financial income or non-financial expenses of the reporting period if accounts
receivable no longer have a balance in the original currency.
 If accounts receivable still have a balance in the original currency, the business can
revalue the goods
33
 If receivable debts are monetary items of foreign currency origin, if they are
difficult to collect at the end of the period, provisions for bad debts must still be
established according to regulations.
2.1.2. Disadvantages
First: because the laws do not have specific regulations, this leads to businesses having
the following situation:
- There are no financial regulations on debt recovery

- Same customer but followed on many different accounts
- The process for approving the option is incomplete, there are no regulations on the
maximum debt amount and payment deadline.
- Reconciliation has not been carried out or debt reconciliation is incomplete at the time of
preparing the Financial Statements
- The difference between the reconciliation sheet and the general ledger has not been
resolved
- Wrong accounting of the digital content of accounts receivable, accounting of receivables
that are not trade receivables into Account 131
- The debt accounting basis is not consistent according to invoices or delivery notes, so the
debt reference numbers do not match.
- Reducing accounts receivable for returned goods, reducing prices for sold goods but
without relevant invoices or documents.
- Recording receivables is inconsistent with reporting higher income. When items are sold
without warehouse documentation, such as delivery notes, the task of moving documents
from the warehouse department to the accounting department should account for
receivables.
- Employees steal or embezzle because there are debts that are collected in cash with
substantial sums of money and no deadline for payment.
- Many receivables that are overdue for payment, with unknown objects, have been
outstanding for many years but have not been processed.
- At the end of the period, foreign currency receivables have not been re-evaluated
- No debt age classification, no effective debt collection and management policy
- Do not account for all interest on overdue debt payments.
- Accounts receivable are recorded incorrectly, customers have paid but have not recorded
them in full
34
- No provision has been made for unclaimed receivables or provision been made for tax or
deduction, exceeding the allowed rate
- Provisioning documents are not complete according to regulations
- Failure to establish a council to handle bad debts and collect complete records of cleared
debts for buyers
Second: With other receivables
- Do not follow details of other receivables

- No reconciliation of unusual receivables has been carried out, assets are missing pending
resolution, there are no inventory records, and the cause cannot be determined to assign
responsibility.
- Accounting to Account 1388 for some items of an incorrect nature
- Do not classify receivables other than short-term and long-term according to regulations.
Third: With the provision for receivables:
- According to Circular guiding the accounting regime for small enterprises, there is no
mention of provisions in the Financial Status Report form. Thus, the financial situation of
these enterprises has not accurately reflected the net realizable value of their assets. The
financial statements published by listed enterprises and public enterprises all make
provisions for bad debts, reflecting the net realizable value of debts receivable at the time
of publication.
- Businesses are allowed to make provisions for bad debts when meeting the following
conditions:
• Original records demonstrating the whole amount of outstanding debt are required,
including one of the original documents listed below: financial agreement, lending
arrangement, bond pledge, Contract termination (where applicable), Debt comparison.
Should there be no debt comparison, a request to alter the debt confirmation process's
direction must be included in writing.
• There are enough reasons to conclude that the debt for receivables is problematic.
Depending on the initial principle payback time specified in the economic contract,
loan agreement, or other documents, the receivable debt is past due by at least six
months.
• In particular, the overdue time is determined from the date of the transfer of creditor
rights between the parties for debts acquired by debt trading companies (with legally
35
recognized professions and debt trading activities) or in accordance with the debt
trading enterprise's and debtor enterprise's most recent commitment, if any
- Making provisions for difficult receivables requires accountants to accurately determine
net realizable value, but this is quite complicated to carry out and time-consuming.
Businesses may face penalties for administrative infractions related to accounting if
accounting fails to accurately reflect the net realizable value of receivables, the provision
for bad debts is unreliable, and the financial statements are prepared and presented in an
erroneous, dishonest, and unreasonable manner, in violation of accounting standards and
accounting regimes.
2.1.3. Difference between IAS and IFRS
The comparison between Vietnamese Accounting Standards (VAS) and International

Financial Reporting Standards (IFRS) concerning receivables in greater detail:
- Recognition Criteria:
 VAS: VAS typically requires receivables to be recognized when there is evidence
of a legal right to receive payment stemming from a past transaction. This often
involves the delivery of goods or services to customers on credit terms, leading to
a contractual obligation for the customer to pay.
 IFRS: Similarly, IFRS necessitates recognition when there is a contractual right to
receive cash or another financial asset from another party. This criterion aligns
with VAS but emphasizes the contractual aspect of the transaction, focusing on the
enforceability of the rights involved.
- Measurement Basis:
 VAS: Receivables under VAS are commonly measured at historical cost or
amortized cost after initial recognition. The effective interest rate method is often
employed to calculate the carrying amount of receivables over time, reflecting the
time value of money.
 IFRS: IFRS offers more flexibility in measurement bases for receivables, allowing
entities to choose between fair value through profit or loss, amortized cost, or fair
value through other comprehensive income. This flexibility enables entities to
select the most appropriate measurement basis based on the nature and
characteristics of their receivables.
- Impairment Assessment:
 VAS: VAS requires impairment losses to be recognized when there is objective
evidence of impairment, such as the financial difficulties of the debtor or the
likelihood of non-payment. Allowances for impairment are established to cover
expected credit losses, ensuring that receivables are carried at their recoverable
amount.
 IFRS: IFRS follows a similar impairment model, emphasizing the recognition of
impairment losses based on expected credit losses over the life of the receivables.
This forward-looking approach requires entities to consider various factors,
36
including historical experience, current conditions, and future expectations, in
assessing the probability of default and estimating the extent of impairment.
- Impairment Measurement:
 VAS: VAS may prescribe specific impairment models, such as the incurred loss
model or the expected credit loss model, depending on the nature of the
receivables and the prevailing economic conditions. These models dictate the
timing and magnitude of impairment recognition, ensuring that receivables are
appropriately valued on the balance sheet.
 IFRS: IFRS primarily adopts the expected credit loss model for impairment
measurement, which requires entities to recognize impairment losses based on
expected credit losses over the life of the receivables. This model focuses on
forward-looking estimates, incorporating information about past events, current
conditions, and future expectations to assess the credit risk associated with
receivables and determine the appropriate level of impairment.
- Foreign Currency Transactions:
 VAS: VAS provides guidance on translating foreign currency receivables using
the prevailing exchange rates at the transaction date or another appropriate date.
Exchange rate differences arising from the translation are typically recognized in
profit or loss or other comprehensive income, depending on the nature of the
transaction.
 IFRS: IFRS requires foreign currency transactions to be translated using the spot
exchange rate at the transaction date, with subsequent recognition of exchange rate
differences in profit or loss or other comprehensive income. This approach ensures
that the financial impact of foreign currency fluctuations on receivables is
accurately reflected in the financial statements.
- Presentation and Disclosure:
 VAS: VAS specifies presentation formats and disclosure requirements for
receivables in financial statements, ensuring transparency and comparability
among entities. This includes disclosing details of measurement bases, significant
accounting policies, impairment assessments, and other relevant information to
enable users to make informed decisions.
 IFRS: Similarly, IFRS mandates appropriate presentation and disclosure of
receivables, emphasizing the importance of transparency and reliability in
financial reporting. While the overarching principles may align with VAS, specific
disclosure requirements may vary slightly, reflecting the diverse needs and
preferences of users in different jurisdictions.
- Interim Reporting:
 VAS: VAS provides guidance on the preparation of interim financial reports,
including the treatment of receivables, to ensure consistency with annual financial
statements. This involves recognizing and measuring receivables in interim
37
periods based on the same principles and methodologies used in annual reporting,
promoting comparability and reliability of interim financial information.
 IFRS: IFRS also offers guidance on interim reporting, with specific requirements
for the treatment of receivables to ensure consistency and reliability of interim
financial information. While the overarching principles may align with VAS,
specific requirements for interim reporting may vary slightly, reflecting the diverse
needs and preferences of users in different jurisdictions.
In summary, while VAS and IFRS share many common principles regarding the recognition,
measurement, presentation, and disclosure of receivables, differences may arise due to
varying legal and economic contexts, as well as specific regulatory requirements in Vietnam
compared to international standards. However, both frameworks aim to provide relevant and
reliable financial information for users to make informed decisions about the entity's financial
position and performance.
2.2. Some suggestions – recommendations to complete accounting of trade receivable
2.2.1. About management
The Company's current accounting apparatus actually operates with good efficiency, but
due to the regime, policies, and accounting standards in Vietnam, there are always changes to
match international accounting standards, especially Especially when our country has just
joined the WTO, the need for integration is inevitable. Therefore, accountants must always
update information, hone their professional abilities, and access scientific and technological
achievements, especially in areas related to accounting. The Company's accounting apparatus
needs to be equipped with more modern accounting tools suitable for the job.
When the Company has many customers, the Company's sales are mainly conducted by
deferred payment method, so it is inevitable that bad receivables arise. If the company
currently does not set up a provision for bad debts, there will be no amount to compensate.
Therefore, the Company should make provisions for bad debts.
At the end of the year, before preparing financial statements, is the time to make
provisions. Accountants use Account 139 - Provision for bad debts to monitor. When setting
up provisions based on the economic contract, contract liquidation record, customer debt
comparison... The accountant determines the amount of provision that must be set up:
Reserve levels need to Total bad debts Insolvency rate

be established
= receivable X
38
Then the accountant records:
Dr Account 642 General administration expenses
Cr Account 2293 Allowances for doubtful debts
At the end of the following accounting year, calculate the amount of provision to be made:
If the amount to be provisioned is greater than the existing amount, record an increase in
provision according to the difference
If the amount to be appropriated is equal to the existing number, the accountant will not
record it
If the amount to be established is smaller than the existing amount, the accountant will reverse
the provision:
Dr Account 2293 Allowances for doubtful debts
Cr Account 642 General administration expenses
2.2.2. Account used
In addition to applying the account system according to regulations of the Ministry of

Finance, however, it is necessary to be more flexible in opening additional level 2 and 3
accounts to monitor customer receivables in more detail.
With a large number of business items, the accounting department should also code the
account in a specific, easy-to-understand way to track the fluctuations in import, export, and
inventory of goods in the warehouse.
2.2.3. Vouchers and voucher circulation
Setting a maximum deadline for departments and functional departments to submit documents
to promptly record and prepare all kinds of reports is very necessary. Assign responsibilities
to accountants in charge of operations to remind relevant departments to submit documents on
time.
There needs to be close coordination between the accounting department and relevant
functional departments to provide support in the process of circulating vouchers and
documents to the accounting department. Documents can be sorted and classified by date,
month of issue or by name or invoice number to facilitate document checking, limit the loss
or misplacement of documents, especially at time of day. There are many transactions that
arise.
39
The company needs to research and perfect the documentation system in a specific and simple
way to avoid cumbersome paperwork in order fulfillment. When receiving an order, the
customer service department can immediately notify the accounting department about the
customer code, quantity of goods picked up, unit price... so that the accountant can
immediately enter the VAT invoice without having to wait for the invoice to be issued. luxury
warehouse like today. Economic contracts should be divided into departments to keep copies,
so that when preparing documents for each customer, there is a contract number in each
department, to avoid asking again which can easily cause confusion.
2.2.4. General accounting books
Creating an additional balance sheet to make comparison and checking easier. The
comparison and checking relationship must ensure that the total amount of arising Debit and
the total amount of arising Credit of all accounts on the Balance Sheet must be equal and
equal to the total amount of money arising on the voucher register. carrying. The total debit
balance and total credit balance of the accounts on the balance sheet must be equal and the
balance of each account on the balance sheet must be equal to the balance of each
corresponding account on the balance sheet. detail matching
2.2.5. Conditions for implementing the solution
With the current management system, the accounting and finance department has a team of
highly qualified and experienced accountants who are properly organized and arranged,
implementing the above recommendations is essential. it's completely doable
CONCLUSION
In culmination, this study has meticulously examined the intricate landscape of trade
receivables within the purview of Vietnamese Accounting Standards (VAS), offering a
nuanced understanding of their recognition, measurement, impairment assessment, and
disclosure protocols. Through a granular analysis, several salient points have come to light,
shaping our comprehension of trade receivables management under VAS.
Firstly, the study underscores VAS's meticulous emphasis on the meticulous recognition
criteria for trade receivables, necessitating a robust legal basis for their inclusion in financial
statements. This aligns VAS with international best practices, ensuring a solid foundation for
financial reporting integrity.
40
Secondly, VAS's prescription for the measurement of trade receivables, typically at historical
or amortized cost using the effective interest rate method, speaks volumes about its
commitment to prudence and accuracy in financial reporting. This approach fosters
transparency and reliability, crucial pillars in fostering investor confidence and market trust.
Moreover, VAS's meticulous guidelines for impairment assessment demonstrate its proactive
stance towards risk management. By requiring entities to recognize impairment losses based
on objective evidence and establish allowances for expected credit losses, VAS ensures that
financial statements accurately reflect the economic realities of potential defaults or non-
payments.
Furthermore, VAS's stringent requirements for the presentation and disclosure of trade
receivables in financial statements serve as a beacon of transparency, enabling stakeholders to
make well-informed decisions. This transparency not only enhances the credibility of
financial reporting but also fosters accountability and trust in the business ecosystem.
In conclusion, this study accentuates the pivotal role of VAS in shaping the management and
accounting treatment of trade receivables in Vietnam. By adhering to VAS's rigorous
standards, businesses can uphold the highest principles of financial reporting integrity,
thereby fortifying investor confidence, facilitating capital allocation, and contributing to the
overall stability and efficiency of the capital market landscape.
Phạm Phương Thảo
REFERENCE
Circular 200/2014/TT-BTC
IFRS Accounting Standards, IASB
VAS
Nguyen, T. H., & Tran, H. Q. (2021). Management and Accounting Treatment of Trade
Receivables under Vietnamese Accounting Standards. Vietnamese Journal of Accounting and
Finance, 10(2), 45-63.
41
APENDIX
*Some transactions arise that increase receivables
Transaction 1 :
Invoice No. X: Sales to A, no payment yet. Discharged according to delivery note No. Y
+Related original documents: Invoice X and Y
Table 1_receiving transaction
Company: Form 02 - VT
Adress (According to Circular No. 200/2014/TT-BTC
dated December 22nd 2014 of the Ministry of

Finance)
GOOD DELIVERY NOTE
Date: Debit
No: Credit
Receiver's Full Name:
Reason for Issuing:
Issuing site (Lot):
QUANTITY
ITEM
NO. ITEM NAME UOM VOUCHER RECEIVE PRICE AMOUNT
CODE
D
A B C D 1 2 3 4
TOTAL
In Words:
No. of Original Document(s):
42
Dated ......../ ......../ ...........
Prepared by Deliverer Storekeeper Chief Accountant

(Signature, full name) (Signature, full name) (Signature, full name) (Signature, full name)
Table 2_VAT tracking book
Company Form: S61 - DN
Adress (According to Decision No. 200/2014/TT-BTC
dated December 22nd 2014 of the Ministry of

Finance)
VAT TRACKING BOOK
ACCOUNT: 33311PAYABLE VAT – DOMESTIC
Date:
OPENING BALANCE:
VOUCHER PAYABLE
ACCOUNT: 33311PAYABLE PAID VAT
DATE, VAT
NO. VAT – DOMESTIC AMOUNT
MONTH AMOUNT
A B C 1 2
TOTAL DEBIT AMOUNT:
TOTAL CREDIT AMOUNT:
CLOSING BALANCE:
43
There are 01 pages in this book, numbered from page 01 to page 01
Date opened:
Dated ......../ ......../ ...........

Prepared By Chief Accountant
(Signature, full name) (Signature, full name)
+ Accounting entry
Debit 632 Costs of goods sold
Credit 155 Finished goods
Debit 131 Trade receivables
Credit 511 Revenues
Credit 3331 Value Added Tax (VAT)
*Some transactions arise that increase receivables

Transaction 2:
Receipt No. X, A paid the monthly debt.
+ Related original documents: Receipt X
Table 3_Receipt
Form: 01-TT
Company:
(According to Circular No. 200/2014/TT-BTC
Adrress:
Dated december 22nd 2014 of the Ministry of Finance)
RECEIPT
No: Account:
Date: Crsp acct:
Payer:
Address:
For:
Amount:
In words:
Enclosure: document(s)
44
Chief accountant Settlement account Cashier Payer
(Sign, full name) (Sign, full name) (Sign, full name) (Sign, full name)
Received the amount (in words):
Date:
+ Accounting entry
Debit 111 Cash
Credit 131 Trade receivables
Transaction 3:
Bank credit notice number X, A repays the debt for goods.
+ Related original documents: X

Table 4_Bank credit notice
Form: 01-TT
Company:
Adrress:
Dated december 22nd 2014 of the Ministry of Finance)
BANK CREDIT NOTICE
Date: Book no:
Number:
Payer:
Company:
Address:
Reason:
Amount:
Enclosure: document(s)
Director Chief accountant Payer Prepared by Cashier
(Sign, full name) (Sign, full name) (Sign, full name) (Sign, full name) (Sign, full name)
Received the amount (in words):
In words:
+ foreign exchange rate (or gold)
+ exchanged money
45
+ Accounting entry
Debit 112 Cash in banks
Credit 131 Trade receivables
* Accounting details of payments with customers at the Company
- Account used: Account 131 “Customer receivables”
- Payment details book is opened for each customer
- Basis of recording method: Based on sales invoices and payment documents, each
original document is recorded in 1 line on the detailed book in chronological order. At the end
of the month, add 131 to the detailed book. The data is recorded in the corresponding detailed
account summary book.
Table 5_Detailed customer tracking book
Company Form S31-DN

Adress
dated december 22nd 2014 of the Ministry of Finance)
DETAILED CUSTOMER TRACKING BOOK
(Account: 131, 331)
Currency: VND
Voucher Ref. Discounted Arising amount Balance

Date Description
No Date account term Dr Cr Dr Cr
A B C D E F 1 2 3 4
- Opening balance
- Arising amount
- Total arising x x x
- Closing balance x x x
Date opened:
46
Date…/…/…
Director
Prepared by Chief accountant
(Sign, full name)
(Sign, full name) (Sign, full name)
On a daily basis, the accountant records transactions from original documents like sales
invoices and receipts. These transactions are then used to prepare bookkeeping documents,
including a register of book-entry vouchers. Original documents are also recorded daily in
detailed books for each subject. At the end of the period, data from the recording vouchers is
added to the ledger, along with information from the detailed books. The total from the ledger
is transferred to a detailed summary table.
- Recording vouchers:
+ Is a separate-sheet diary reflecting economic and financial transactions arising during the
period in chronological order
+ Can be prepared according to original documents, can be prepared according to accounts,

can be prepared according to periods or can be prepared according to periods combined
according to economic and professional content
+ Only has legal value when attached to original documents
Table 6_ Recording vouchers for customers
Company Form S02a-DN

Adress (According to Circular No. 200/2014/TT BTC
dated december 22nd 2014 of the Ministry of

Finance)
RECORDING VOUCHERS
No:
Date…./..../ ....
Account number
Description Amount Note
Debit Credit
47
A B C 1 D
Total x x x
Attached with... original documents
Date .../ ... ...

Prepared by Chief accountant Legal representative
(Sign, full name) (Sign, full name) (Sign, full name)
The completed book-entry vouchers are checked, approved by the chief accountant and then
transferred to the general accountant to be recorded in the book-entry voucher registration
book.
- Register of recording documents:
+ Is a journal book used to reflect the accounting documents created during the period and to
compare data with the balance sheet.
+ Basis of recording method: Based on the book-recording vouchers created during the
period, each book-recording voucher is recorded in 1 line on the book-recording voucher
register in chronological order. At the end of the month, add the register of bookkeeping
documents, the data must match the balance sheet arising in the same month.
Table 7_ Register of accounting vouchers for customers
Form S02b-DN
(According to Circular No. 200/2014/TT BTC
Company
Address
REGISTER OF ACCOUNTING VOUVHERS FOR CUSTOMERS
Year…
Vouchers Amount Vouchers Amount
No. Date No. Date
48
A B 1 A B 1
- Total amount - Total amount
- Accumulated amount - Accumulated amount
Date opened:...
Date .../ ... ...

- General Ledger
Basis of Recording Method: Based on the documented evidence registered in the journal
after being recorded in the journal of registered vouchers, accountants sequentially record
related accounts in the General Ledger according to the chronological order. At the end of the
month, the General Ledger is totaled, and the account figures are recorded in the balance sheet
of arising numbers.
Table 7_ General ledger
Company: Form S03b-DN

(According to Circular No. 200/2014/TT BTC
Address
GENERAL LEDGER
Year…
Account…
Date Voucher Description General ledger Ref. Amount
49
No. Date Page Line Account Dr Cr
A B C D E G H 1 2
- Balance at the
beginning of the year
- Number arising during

the month
- Add monthly numbers
- Balance at the end of

the month
- Cumulative addition
from the beginning of
the quarter
- Opened date
Date .../ ... ...

50

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NATIONAL ECONOMICS UNIVERSITY

SCHOOL OF ACCOUNTING AND AUDITING

TOPIC: Accounting for accounts receivable in businesses today in Vietnam

Student name: Pham Phuong Thao

Student ID: 11219317

Class: Accounting CFAB K63

Supervisor: Nguyen Ha Linh

TNHH Trách nhiệm hữu hạn

TP. HCM Thành phố Hồ Chí Minh

PA1 Phương án 1

PA2 Phương án 2

TBYT Thiết bị y tế

GTGT Gía trị gia tăng

VAT Thuế giá trị gia tăng

HTK Hàng tồn kho

CTGS Chứng từ ghi sổ

BTC Bộ Tài Chính

GBN Giấy báo nợ

Understanding a customer's creditworthiness and capacity to fulfill their payment

Furthermore, decision-making and financial reporting depend on the analysis of trade

My essay is divided into 3 parts:

Part 2: Research about trade receivable

Chap 1: Overview and accounting treatment for trade receivable

Chap 2: Evaluation and recommendation

According to Vietnamese Accounting Standards (VAS), trade receivables are considered as

The nature of trade receivables under VAS typically includes:

These characteristics underline the importance of effective management and monitoring of

1.1.3. The classification of trade receivable

- Customer receivables: Customer receivables are commercial receivables arising from

According to Vietnamese Accounting Standards (VAS), trade receivables are typically

- Maintaining precise records of customer receivables, including details such as payment

- Additionally, accounting personnel should promptly verify or request written confirmation

The accounting account 131 is structured as follows:

Debit balance: Remaining trade receivables.

This account may have a credit balance

1.2.1.4 Accounting treatment

1.2.1.5. Accounting ledger

- Detail ledger of accounts receivable, general accounting ledger

1.2.2. Accounting for Internal receivables

1.2.3. Accounting for bad debt provisions

1.2.1.1 Accounting documents

1.2.1.3 Accounts used

1.2.1.1 Accounting documents

- Receipts, Payment vouchers, Debit notes, Credit notes

1.2.1.2 Accounting rules

1.2.1.3 Accounts used

Account 138 is used.

Structure of account 138:

- The sum awaiting resolution for unaccounted assets;

- Move the worth of unaccounted assets to corresponding accounts outlined in the

- Other receivables not yet collected.

Account 138 - Other Receivables has 3 sub-accounts:

- Account 1381 - Pending Resolution for Missing Assets

1.2.1.4 Accounting treatment for trade receivable

Dr Account 138 - Other Receivables (1381) (remaining value of fixed assets)

Cr Account 211 - Fixed Tangible Assets (original cost).

Dr Account 214 - Depreciation of Fixed Assets (depreciation value)

Cr Account 211 - Fixed Tangible Assets (original cost).