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Vietnam Adopts International Auditing Standards, Diverging from US Rules

Hanoi - In an effort to harmonize its auditing standards with global best practices, Vietnam has adopted the International Standards on Auditing (ISA). This move diverges from the rules set by the United States Public Company Accounting Oversight Board (PCAOB).

Expert Insights

According to experts, Vietnamese companies listed in the US stock market and American firms operating in Vietnam need to comply with both countries’ auditing regulations. Marie Tran, an accountant with experience working with audit firms in both the US and Vietnam, conducted a study to compare the two sets of standards.

Key Findings

The research found that the Vietnamese Standards on Auditing (VSA) is more closely aligned with ISAs than with PCAOB standards. The main differences lie in accounting standards and social-economic factors.

“The VSA is moving towards international standards, whereas the PCAOB standards are specific to the US market,” said Tran. “This means that Vietnamese companies listed in the US need to comply with both sets of regulations, which can be challenging.”

Implications for Multinational Corporations

The study’s findings have significant implications for multinational corporations operating in Vietnam and those planning to list their shares on the US stock market. Companies must ensure they meet both countries’ auditing standards to avoid regulatory non-compliance.

In related news, the Vietnamese government has been pushing for reforms to its audit industry, including mandatory audit firm rotation. The move aims to improve transparency and accountability in the sector.

Conclusion

As Vietnam continues to open up its economy to foreign investment, the need for harmonized auditing standards becomes increasingly important. With the adoption of ISAs, Vietnam is sending a signal that it is committed to international best practices and transparency in its financial reporting.

References

  • International Standards on Auditing (ISA)
  • Vietnamese Standards on Auditing (VSA)