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VFC: Explanation for the consolidated financial statement in quarter 2/2009
Vinafco Joint Stock Corporation (VINAFCO) has explained matters which impacted on auditor’s opinions in the consolidated financial statements audited on August 10, 2009 but the matters based on the company’s opinion as follows:
1. “Financial investments in joint-ventures or associates were recorded according to the cost method but not consolidated by the equity method.”
AASC used this opinion in the audited financial statements in 2007 and 2008. According to a legal document (Circular No. 61/2007/TT-BTC issued by the Ministry of Finance), the financial method used for financial investments in associate companies is the cost method or the equity method. Therefore, based on the real state, the company did not recorded financial investments at June 30, 2009 by the equity method and used the cost method from the start of investments until now.
2. “As at June 30, 2009, items of debt receivables and payables were not compared and confirmed completely.”
Reason: The period from June 30, 2009 (closing the book) to July 15, 2009 (submitting financial statement) was not enough for the company to collect the comparison tables completely to confirm debt receivables and payables sent to customers and suppliers. Besides, the number of customers and suppliers is too large and the habit of debt balance in midyear is not popular in Vietnam.
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