Member | Established: 2005 | Associate since 2015
VACPA was established in 2005 under Decision 15/2005/QD-BNV by the Ministry of Home Affairs. Originally established as a professional association under the umbrella of VAA, in 2014, VACPA became a second PAO operating in Vietnam. VACPA is recognized as the national PAO for auditors and audit firms and while membership is voluntary, all members must hold a CPA certificate issued by the MOF. There are some members of VACPA that are also members of VAA. Under Article II of VACPA’s charter, the objectives of VACPA are: to develop the quality of accounting and auditing services; to preserve professional ethics; to enhance member value to be recognized by regional and international organizations; and contribute to transparency of economic and financial information in Vietnam in accordance with laws and regulations. VACPA also administers training and development for its members; works with the MOF to draft technical standards for the profession, including the national Code of Ethics; and participates in both quality assurance, and investigative and disciplinary activities, which are overseen by the MOF. In addition to being an IFAC Member, VACPA is a member of the Confederation of Asian and Pacific Accountants.
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Statements of Membership Obligation (SMO)
The Statements of Membership Obligations form the basis of the IFAC Member Compliance Program. They serve as a framework for credible and high-quality professional accountancy organizations focused on serving the public interest by adopting, or otherwise incorporating, and supporting implementation of international standards and maintaining adequate enforcement mechanisms to ensure the professional behavior of their individual members.
Last updated: 12/2021
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Status of Fulfillment by SMO
SMO 1: Quality Assurance
- Although the MOF has direct responsibility for QA, since 2009, VACPA has been participating at the request of the MOF during the execution of QA review activities. These activities include participating in on-site inspections and providing input on policies related to QA. VACPA has also supported the quality control initiatives in Vietnam by supporting the development of VSQC 1, which is based on ISQC 1. VACPA has disseminated the new quality management standards issued by the IAASB with its members and is considering how to provide guidance during CPD offerings. However, the standards are not expected to be adopted immediately and will be translated and introduced for approval by the MOF within the next three years.
- VACPA has collaborated with the MOF and the SEC to host workshops to communicate with audit firms and other stakeholders on topics such as audit quality and discussing the results of the QA reviews. VACPA has also developed guidance materials on quality control, and the association has translated the IFAC published Guide to Practice Management for Small-and Medium-sized Practices into Vietnamese. VACPA reports that in 2020, it published an article about the quality control experiences in other countries and lessons for Vietnam. As mentioned above, in 2017, VACPA presented to the MOF a proposed new QA review program which is aligned with the requirements of SMO 1. Discussions with the MOF are ongoing, and no timetable has been established.
- As CPD is mandatory for all VACPA members, the association has developed CPD around QA and quality control issues. VACPA has also shared lessons learned from other jurisdictions, by the way of producing articles in VACPA magazines.
- Progress has been made to address SMO 1 requirements, given the level of responsibility of VACPA. It is encouraging that VACPA promotes the proposed QA system to the MOF and continues offering its expertise on the matter. VACPA is encouraged to consider how it can reflect on the results and findings from the MOF QA reviews to tailor and develop specific CPD seminars and courses for its members.
SMO 2: International Education Standards
- As the MOF is responsible for establishing initial and continuing professional development requirements for the profession, progress has been slow to fully adopt the IES; however, VACPA continues its efforts to work with the MOF and also local universities to raise awareness of the requirements and plans to consider the IFAC recommendation to conduct a gap analysis of national requirements against those of IES. Due to COVID-19, VACPA has also taken additional steps to enhance its delivery of CPD for the benefit of members.
- VACPA has been accredited by the MOF to provide training courses for auditors and the association monitors the fulfillment of CPD hours by its members and submits any issues of non-compliance to the MOF for further action and possible sanctions. VACPA also supports the MOF by participating in the MOF’s examination council, which is responsible for administering the Vietnam CPA exam that is mandatory for individuals that choose to become auditors, reviewing the exam papers, and distributing exam results. VACPA reports that it monitors new and revised regulations and standards and encourages the responsible bodies to incorporate them into education and examination requirements.
- VACPA has established a Training Committee and a Research and Consulting Center for CPAs to develop and host classroom based CPD courses for its members. VACPA invites partners and managers from the Big 4 accounting firms to lecture CPD courses. Topics range from accounting, audit, tax, finance, banking, securities, valuations, amongst others, and VACPA reports that courses developed and offered are based on feedback from its members. Due to COVID-19, all of VACPA’s CPD was moved online for the first time and has attracted a larger number of participants.
- VACPA has also collaborated with international PAOs such as ACCA, CPA Australia, Chartered Institute of Management Accountants (CIMA), and Institute of Chartered Accountants of England and Wales (ICAEW) to develop and co-host CPD sessions and seminars. Activities reported by VACPA with these bodies include working with ACCA and ICAEW to translate their respective syllabi into Vietnamese.
- In addition, since June 2016, individuals who have passed the Vietnam CPA exam are exempt from taking the exam on tax as offered by CPA Australia, and the exams on Tax and Audit and Assurance Services as offered by ACCA. VACPA reports that it was in discussions with CPA Australia to offer another exemption on the exam on auditing. These international PAOs are also allowed to offer their programs in Vietnam.
- VACPA reports that it acts as an advisor to 17 local universities that offer courses in accounting and auditing. As part of its advisory, VACPA promotes the IES to the universities to encourage their syllabus to follow international standards. VACPA has also collaborated with the universities to offer training courses, host various local and international seminars, conduct research, and VACPA is working with the universities to translate the IES into Vietnamese. VACPA has also supported mentorship arrangements where students could work with members and member firms of VACPA.
- Understanding the context and situation on the ground is important to knowing why moving forward with the IES in Vietnam will be a long-term project. VACPA is encouraged to continue its conversations with the MOF and MoET to advance the incorporation of the IES in Vietnam. VACPA is also encouraged to provide updates on its translation efforts. VACPA is encouraged to consider driving or conduct a gap analysis of the overall national requirements against the revised IES, hopefully in collaboration with other stakeholders, and establish a defined plan with a specific timeframe to reduce the gaps.
SMO 3: International Standards on Auditing
- In 2012, under Circular No. 214 issued by the MOF, VACPA was directed by the MOF to update the VSA. To that effect, VACPA has established the Auditing Standards Committee and its responsibilities include translating, researching, drafting, and submitting the standards to the MOF for approval.
- VACPA reports that the 2012 IAASB Handbook has been translated into Vietnamese for its member’s reference and it is currently updating VSAs based on the latest ISAs. VACPA has translated the version of ISAs (32 ISAs) available at the time into Vietnamese in 2019 (for reference and reporting the MOF on the differences between VSAs and ISAs) and has submitted 10 VSAs (VSA 570; VSA 700 series; VSA 800 series, including VSA 701 for first issuing) to the MOF for consideration and issuance. The timetable for finalizing this process is the next few years given the local processes and having to ensure the standards align with local laws.
- VACPA’s Training Committee has included the VSA into its various training programs and the committee has also developed guidance documents for the application of VSA and ISA. VACPA reports that lecturers from the Big 4, and foreign PAOs are invited to share insights and expertise with VACPA members as part of its training programs. VACPA reports that it collaborates with the MOF and other stakeholders in a unified approach to review and respond to exposure drafts. VACPA believes the current model of working with other groups in Vietnam allows for a collective understanding of the needs in the country.
- VACPA reports that it has translated into Vietnamese the “Guide to Practice Management for Small-and Medium-Sized Practices” as published by IFAC and issued the translation to its members, the general public, and universities in December 2018. VACPA has also translated the ISCA Audit Manual For Standalone Entities (ISCA AMSE) for reference and workshop. VACPA also developed an audit manual to support audit practitioners and firms.
- As VACPA is involved in the development of auditing standards, VACPA is to continue developing a due process that allows for timely adoption of international pronouncements to minimize the time lag between their issuance and their applicability in the jurisdiction.
SMO 4: Code of Ethics for Professional Accountants
- Although VACPA is not directly responsible for the adoption of ethical requirements in Vietnam, it reports that it supports the MOF by translating the code and presenting to the MOF for approval.
- VACPA reports that the requirements of the Code of Ethics are incorporated into mandatory annual CPD for its members and that multiple courses are offered on ethics. Taking CPD on ethics is a requirement for all members. In 2014, VACPA translated the 2014 IESBA Code of Ethics and reports that has completed translating the 2018 version, which is scheduled to be adopted mid-2021. Once the Code is published, courses and seminars around the new Code will be offered to members and students. VACPA is an active participant in responding to IESBA consultations and papers.
- VACPA reports that it is having ongoing discussions with universities to make a course on ethics compulsory for accounting students at universities.
- VACPA is encouraged to raise awareness of the MOF about the need to develop a due process that allows for timely adoption of international pronouncements in the jurisdiction to minimize the time lag between their issuance and their applicability in the jurisdiction.
SMO 5: International Public Sector Accounting Standards
- Although VACPA is not responsible for the adoption of public sector standards in Vietnam, it reports that its activities have revolved around the promotion of IPSAS adoption and that it has supported research on IPSAS when participating in activities hosted by the MOF. VACPA reports that it has also attended workshops and conferences on IPSAS and issues around the public sector hosted by the MOF.
- In August of 2018, VACPA collaborated with CAPA to organize a Roundtable on the Public Sector in Hanoi. In addition, VACPA also translated into Vietnamese and distributed “Improving Financial Management in the Public Sector-The Eight Key Elements of PFM Success” published by CAPA. VACPA reports that it participates in the national standard-setting process by responding to the MOF consultation on the drafting of Vietnamese public accounting standards.
- VACPA is encouraged to consider further collaborative activities with the MOF that promote the adoption of IPSAS, as well as the activities related to supporting the implementation of national public sector accounting standards. For example, VACPA is encouraged to consider its participation and contribution to the National Accounting General Project and TABMIS, and how its participation will benefit the profession and environment in Vietnam. As there are VACPA members that work in the public sector, VACPA is encouraged to consider and provide examples of support for those members to understand and apply public sector standards and regulations.
SMO 6: Investigation and Discipline
- VACPA’s activities in the area of I&D are limited to dismissal from membership any members or firms that are found to have violated any regulations or when any audit certificates are revoked by the MOF. VACPA’s membership regulations stipulate certain criteria and conditions for engaging in practice—for example, adhering to CPD requirements and ethical requirements of the MOF. VACPA also reports that it has developed and published guidance that deals with complaints about its members. On an annual basis, VACPA submits reports of CPD hours completed by all of its members to the MOF, who utilizes the data to issue or withdraw practicing certificates to auditors.
- VACPA is aware that the I&D system in Vietnam requires major improvements and is committed to improving the system as part of the effort at the jurisdiction level to improve audit quality. VACPA’s representatives attend I&D hearings led by the MOF and VACPA is engaged with the regulatory bodies in Vietnam on reviewing the I&D system that is in place.
- As previously suggested, VACPA is encouraged to develop and execute specific plans to promote the requirements of SMO 6 to the MOF so that the existing I&D system in Vietnam be aligned with international best practices. If possible and feasible, VACPA could consider developing its own system for its members. As there is an important focus on enhancing the quality of audit, VACPA is encouraged to consider reiterating to the MOF that both QA and I&D systems are both crucial for enhancing audit quality.
SMO 7: International Financial Reporting Standards
- Although VACPA does not have responsibility for the adoption of accounting standards, it has supported the MOF in its discussions with regional and international partners on the helping Vietnam to eventually adopt IFRS in the jurisdiction. This has included discussions with the IFRS Foundation, other standard-setting entities in the region, and VACPA will collaborate with the MOF and others to translate IFRS into Vietnamese.
- VACPA has taken an active approach in promoting the awareness of IFRS to its members and other stakeholders in the jurisdiction through training courses and CPD. The institute has hosted annual trainings on IFRS with ACCA and it has also supported the Institute of Singapore Chartered Accountants (ISCA) in translating the standard on ‘Fair Value following IFRS’ into Vietnamese. Since 2018, VACPA and ACCA have collaborated to administer a training program on IFRS for VACPA students and members. Going forward, VACPA plans to collaborate with ACCA to administer a training program in the Vietnamese language to support SMEs and universities.
- VACPA is encouraged to continue its efforts to support the MOF with the translation of IFRS into Vietnamese and also participate in initiatives to promote the adoption of IFRS. It is also encouraging that progress has been made to meet the jurisdiction’s deadline for adopting IFRS.
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