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TAC: Explanation for comments of auditors in the audited financial statement
Tuong An Vegetable Oil Joint Stock Company has explained comments of auditors in the audited financial statement ended at 30th June 2010 as follows:
1. The company did not increase fixed assets timely, calculate depreciation and stop capitalizing interest expenses when the Phu My oil plant was put into operation:
Although the Phu My oil plant was put into operation in November 2008, it only run key equipments, during the operation time, completed items was gradually used in the plant. In addition, the company did not finished payment procedures with contractors, thus there was no increase of fixed assets and it could not calculate depreciation value. Meanwhile, in 2009, after updating figures, the company increased fixed assets from basic construction in the months of February, August, October and December worth VND114,835,834,417, then, the company calculated depreciation and stopped capitalizing.
2. Decrease of corporate income tax in 2007 and 2008:
According to a Document No.149/TCT-PC of the General Department of Taxation dated 14th January 2010, the company combined 2 policies as 50% of tax reduction due to privatization and 50% of tax reduction due to the first stock listing on HOSE before 31st December 2006 into tax exemption applied for 2007 and 2008. According to recommendation of an audit firm, the company will send a Document to tax authorities in order to clear up the issue.
3. After-examination profit dropped VND2,897million in comparison with before examination:
Some selling and management expenses in the first 6 months were recorded in July 2010. However, when examination, auditors were recorded in June 2010.
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