Chapter III
FINANCIAL PRUDENCE
Article 6. Principles of financial prudential
1. Securities companies, asset management companies shall maintain the financial prudential ratios, ensure liquidity and compliance with the relevant provisions of the Securities Law, Law Amending and Supplementing a number articles of the Securities Law and the guidelines.
2. The financial prudence shall be ensured through :
a) Purchase of professional liability insurance or setting up the investor protecting funds, provision funds for loss and compensating for damages under the provisions of Article 11 of this Circular;
b) Making provisions for devaluation of securities as prescribed in Article 7 of this Circular.
b) Making provisions for losses on securities investment as prescribed in Article 8 of this Circular.
b) Making provisions for operational risk and financial reserve funds as prescribed in Article 14 of this Circular.
dd) Making provisions for bad debts in compliance with regulations for businesses.
Article 7. Provision for devaluation of securities
1. Conditions for making provisions
a) The securities are recorded at cost prices by securities companies, asset management companies in accordance with the law on accounting.
b) The actual prices of securities freely traded on the market at the time of making the financial statement are lower than their prices on the accounting book.
c) Securities are restricted from transfer under the provisions of law and provisions for devaluation of treasury stock are not allowed.
2. The method of provision:
The level of securities devaluation provision shall be calculated by the following formula:
|
The level of securities devaluation provision
|
=
|
Number of devaluated securities at the time of making the financial statement
|
x
|
|
Price of securities on the accounting book
|
-
|
The actual securities price on the market
|
|
3. Determination of the actual securities price on the market for provision:
a) For listed securities, traded registered securities, traded securities price for provision shall be the actual securities price at the Stock Exchange of the latest trading date before the date of setting up the provision, specifically :
- For securities listed on the Stock Exchange, the actual price on the market shall be the closing price on the latest trading date before the date of setting up the provision
- For traded registered securities (traded registered stocks in UPCOM), the actual price on the market shall be the closing price on the latest trading date before the date of setting up the provision.
b) For unlisted and unregistered securities:
- Securities actual price on the market which is a basis for provision shall be the average price of the actual transactions according to the quoting of 3 companies trading securities at the latest time of setting up provision but not more than one month before the date of setting up the provision.
If securities do not have arising actual transactions during such period, provision shall not be set up.
-The manager or administrator of securities companies selected to quote shall not have relationship with the manager and administrator of the securities companies/asset management company quoted as prescribed in the Law on Securities.
-Securities companies quoting are entitled to charge for securities companies / asset management companies requesting to quote the quotation and shall be responsible for the accuracy and truthfulness of the information provided. Charge rates shall be mutually agreed
c) For delisted or suspended securities from the 6th trading date onwards, the actual securities price shall be the book value on the latest date of making the balance sheet.
4. Rules for provisions:
a) Provisions for every kind of investment securities that devaluate compared to their book values when the financial statement is made shall be set up and included in the list of security devaluation provisions, which is the basis for inclusion in financial expenses of the securities company or asset management company;
b) Every securities company and asset management company shall set up the provision at the end of accounting periods when the quarterly or annual financial statement is made;
c) If the actual value of the securities can not be determined, the securities companies, asset management companies must not set up the securities devaluation provision.
5. Handling of securities devaluation provision :
a) The handling of securities devaluation provision shall be at the end of the quarter, year on the date of the quarterly, annual financial statements are made ;
b) If the securities devaluation provision set up in a period is equal to the balance of the provision set up in the previous period, it shall not be set up;
c) If the provision set up in a period is higher than the balance of the unused provision in the previous period, the difference shall be included in financial expense;
d) If the provision set up in a period is lower than the balance of the unused provision in the previous period, the company shall reverse the inclusion of the difference in expense and reduce the financial expense/record a decrease in financial expense.
Article 8. Provision for losses on long-term financial investments
1. Securities companies, asset management companies shall set up a provision for losses on long-term financial investments as prescribed in the law for businesses.
2. The provision for losses on long-term financial investments shall be set up at the end of the accounting period when the annual financial statement is made
Tìm kiếm
Thông tư 146/2014/TT-BTC (Bản Word)
Thông tư 146/2014/TT-BTC (Bản Pdf)