Main products of the company are coffee, which makes the Company a seasonal business. Harvest of coffee begins in September and finish in February of the next year. 31/12 is the middle of the harvest and to ensure the enough material for production, the Company continued purchasing materials, which made it difficult to inventory. Thus, we did not require the Auditor to be present during the inventory. However, we inventoried roughly goods and fixed assets of the Company on 31/12/2012.
Solutions:
Because the Company’s products are seasonal, in the next fiscal year, the Company will ask the SSC, HNX and related agencies to allow the Company’s seasonal financial statement, which facilitates the building of financial statement and the inventory with the Auditor’s attendance.
Relating to the asset and liabilities structure, the Company has misused the resources. A part of short-term capital was used for long-term investment, mainly coffee and rubber growing. Thus, all interest expenses of investments were not capitalized to become assets. Theu were accounted as expenses of the term, which caused the loss. The company plan to restructure the resources by applying the following measures:
- Working with banks to restructure liabilities of about VND200 billion from short-term to long-term
- Liquidating assets at member units (about VND300 billion) to pay for the banks and offset the loss of previous year.
- Calling for capital contribution from lenders.
- Petitioning to be supported from the Government relating to this industry.
- Completing projects.