Can a foreign audit firm carry out audit activities in Vietnam, in the form of providing cross-border audit services to enterprises in Vietnam ?
Foreign auditing firms:
Foreign auditing firms perform audit activities in Vietnam in the form of providing cross-border audit services according to the Government's regulations (Clause 3, Article 36 of the Law on Independent Auditing No. 11/VBHN-VPQH dated December 31, 2015).
Conditions for providing audit services across borders:
A foreign audit firm that fully meets the following conditions may register to provide cross-border audit services: To be permitted to provide independent audit services in accordance with the law of the country where the foreign audit firm’s headquarters is located; Having at least 5 (five) auditors who have been granted registration certificates for audit practice by the Ministry of Finance of Vietnam, including the legal representative; Having equity on the balance sheet equivalent to 500,000 (five hundred thousand) US dollars at the end of the fiscal year preceding the year in which cross-border audit services are provided in Vietnam; Implementing mandatory deposit of an amount equivalent to the legal capital specified in Clause 1, Article 5 of this Decree at a commercial bank lawfully operating in Vietnam and having a letter of payment guarantee from this bank committing to pay in case the liability of audit contracts providing cross-border services in Vietnam exceeds the mandatory deposit (Clause 1, Article 11 of Decree No. 03/VBHN-BTC dated January 14, 2019).
Methods of providing cross-border audit services:
When providing cross-border audit services in Vietnam, foreign auditing firms must perform a joint venture agreement without creating a separate legal entity (unincorporated joint venture) with auditing firms in Vietnam that are eligible to provide audit services as
Only auditing firms that fully satisfy the conditions for business of auditing services specified in Article 21 of the Law on Independent Auditing and this Decree, and have obtained a Certificate of eligibility for audit service business can participate in a joint venture agreement with a foreign audit firm to provide cross-border services (Clause 1, 2, Article 12 of Decree No. 03/VBHN-BTC dated January 14, 2019).
To sum up, a foreign audit firm, meeting the conditions and methods prescribed by the Vietnamese Government, can conduct audit activities in Vietnam in the form of providing cross-border audit services for enterprises in Vietnam./.
Providing cross-border audit services?
|DMS Law office in Vietnam|
Lawyer Do Minh Son
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