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Quarterly audits cost too much time, money, listed firms protest   2009-03-17 - VietNamNet/TN

Many listed companies are in disagreement with a State Securities Commission requirement for compulsory quarterly audits, saying it is costly and may cause a delay in announcing audited results.

 
In a note issued February 24, the stock market regulator - known as SSC - asked audit companies to complete quarterly audits before yearly audits and give their comments. But listed companies that do not observe this regulation face no penalties.

The note said the decision was made after some listed companies made “unusual changes” in quarterly results, leaving investors querulous and unhappy, “affecting the stock market’s transparency.”

Some publicly traded enterprises reported profits in the first three quarters of last year, huge losses in the final quarter, and losses for the whole year.

Bui Van Mai, general secretary of the Vietnam Association of Certified Public Accountants, said additional quarterly audits would cost companies 20-30 percent more.

Le Van Diep, deputy general director of Minh Phu Seafood Company based in southern Ca Mau Province, said apart from his firm’s factories in Vietnam, it has a branch in the US and had to pay travel costs for Ernst & Young Vietnam staff to go there and conduct audits last year.

In case of quarterly audits, Diep said his company has to foot the auditors’ bills for four trips to the US a year.

Nguyen Van Thang, deputy head of shareholder relations, at software developer and mobile phone distributor FPT, said his corporation, with 16 subsidiaries located across the country and operating in various businesses, fears it may miss the deadline for announcing quarterly results - the 25th day of the next quarter - if quarterly audits are carried out.

He said his company is still waiting for last year’s audited financial results, which normally take three months.

But Tran Dinh Cuong, general director of Ernst & Young Vietnam, said audit companies would benefit from quarterly audits as the workload is spread over the financial year.

Mai said quarterly audits would help reduce errors in results.



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