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KPMG Model VAS Financial Statements Version 2004-1

ClientNameHere

Set ReportName "ReportTitleHere" ReportTitleHere

Set RepSubTitle "Subtitle/optional date" Subtitle/optional date

set HdrInfo "KPMGCoreServiceorIndustryOptionalInsertDate" KPMGCoreServiceorIndustryOptionalInsertDate[ABC Company Limited]

Financial Statements for the year

Investment Licence NoXX/GP [date month year]

XX/GPDC1 [date month year]



Option 1: Where there are no licence updates

The investment licence was issued by the [Ministry of Planning and Investment] and is valid for XX years.

Option 2: Where there are licence updates

The investment licence and updates were issued by the [Ministry of Planning and Investment]. The investment licence is valid for XX years from the date of the initial investment licence.

Board of ManagementNameChairman

NameVice Chairman (until [date month year])

NameVice Chairman (from [date month year])

NameMember

NameMember

NameMember

NameMember

Board of DirectorsNameGeneral Director

NameDeputy General Director

Registered Office[address line 1]

[address line 2]

[address line 3]

Vietnam

AuditorsKPMG Limited

Vietnam

CodeNote2006VND'0002005VND'000

Restated

ASSETS

Current assets100XXXX

Cash and cash equivalents1103XXXX

Cash111XXXX

Cash equivalents112XXXX

Short-term investments12012XXXX

Short-term investments 121XXXX

Allowance for diminution in the value of short-term investments129(XX)(XX)

Accounts receivable - short-term1304XXXX

Accounts receivable - trade131XXXX

Prepayments to suppliers132XXXX

Inter-company receivables133XXXX

Excess of contract work-in-progress over progress billings134XXXX

Other receivables135XXXX

Allowance for doubtful debts139(XX)(XX)

Inventories1405XXXX

Inventories141XXXX

Allowance for inventories149(XX)(XX)

Other current assets150XXXX

Short-term prepayments151XXXX

Deductible value added tax152XXXX

Taxes and other receivables from State Treasury1546XXXX

Other current assets158XXXX

Long-term assets200XXXX

Accounts receivable - long-term2104XXXX

Accounts receivable - trade211XXXX

Operating capital given to branches212XXXX

Inter-company receivables213XXXX

Other receivables218XXXX

Allowance for doubtful debts219(XX)(XX)

Fixed assets220XXXX

Tangible fixed assets2217XXXX

Cost222XXXX

Accumulated depreciation223(XX)(XX)

Finance lease tangible fixed assets2248XXXX

Cost225XXXX


Intangible fixed assets2279XXXX

Cost228XXXX

Accumulated amortisation229(XX)(XX)

Construction in progress23010XXXX

Investment property24011XXXX

Cost241XXXX


Long-term investments25012XXXX

Investments in subsidiaries251XXXX

Investments in associates, joint-ventures252XXXX

Other long-term investments258XXXX

Allowance for diminution in the value of long-term investments259(XX)(XX)

Other long-term assets260XXXX

Long-term prepayments26113XXXX

Deferred tax assets26214XXXX

Other long-term assets268XXXX

TOTAL ASSETS270XXXX

RESOURCES

Liabilities300XXXX

Current liabilities310XXXX

Short-term borrowings and liabilities31115XXXX

Accounts payable trade312XXXX

Advances from customers313XXXX

Taxes payable to State Treasury31416XXXX

Payables to employees315XXXX

Accrued expenses31617XXXX

Inter-company payables31718XXXX

Excess of progress billings over contract work-in-progress31819XXXX

Other payables31920XXXX

Provisions32021XXXX

Long-term borrowings and liabilities33022XXXX

Accounts payable trade331XXXX

Inter-company payables33218XXXX

Other long-term liabilities333XXXX

Long-term borrowings and liabilities334XXXX

Deferred tax liabilities33514XXXX

Provision for severance allowance33621XXXX

Provisions33721XXXX

equity400XXXX

Equity410XXXX

[Contributed capital/ Share capital]41123XXXX

Capital surplus41223XXXX

Other capital413XXXX

Treasury shares41423(XX)(XX)

Differences upon asset revaluation415XXXX

Foreign exchange differences41624XXXX

Investment and development fund417XXXX

Financial reserves41825XXXX

Other equity funds419XXXX

Retained profits/(accumulated losses)420XX(XX)

Total resources440XXXX

Prepared by:Approved by:

NameName

Chief AccountantGeneral Director


Restated

Total revenue0126XXXX

Less sales deductions0226(XX)(XX)

Net sales10XXXX

Cost of sales1127(XX)(XX)

Gross profit/(loss)20XX(XX)

Financial income2128XXXX

Financial expenses2229(XX)(XX)

Selling expenses24(XX)(XX)

General and administration expenses25(XX)(XX)

Net operating profit/(loss)30XX(XX)

Results of other activities40

Other income3130XXXX

Other expenses3231(XX)(XX)

Profit/(loss) before tax50XX(XX)

Corporate income tax current5132(XX)(XX)

Corporate income tax deferred5232(XX)(XX)

Net profit/(loss) after tax60XX(XX)

Earnings per share33

Basic earnings per share70XXXX

Diluted earnings per shareXXXX


NameName


Add columns for differences upon asset revaluation and investment and development funds, if required. Delete columns not used.

[Contributed/share]

capitalVND'000Capital surplusVND000Foreign exchange differences VND'000Financialreserves

VND'000Retained profits/ (accumulated losses)

VND'000Total VND'000

Balance at 1 January 2005 as restatedXXXXXXXXXXXX

Balance at 1 January 2005

as previously statedXXXXXXXXXXXX

Adoption of new accounting policy(see Note 2(b))----XXXX

[Contributed capital/ Share capital issued]XXXX---XX

Unrealised exchange differences-(XX)---(XX)

Net profit/(loss) for the [period/year]----XXXX

Dividends----(XX)(XX)

Profits reinvestedXX---(XX)-

Balance at 1 January 2006 as restatedXX(XX)XXXXXXXX

Balance at 1 January 2006

as previously statedXXXXXXXXXXXX

Adoption of new accounting policy(see Note 2(b))----XXXX

[Contributed capital/ Share capital issued]XXXX---XX

Unrealised exchange differences-XX---XX

Net profit/(loss) for the [period/year]----XXXX

Dividends----(XX)(XX)

Profits reinvestedXX---(XX)-

Balance at [31 December 2006]XXXXXXXXXXXX


NameName



Cash flows from operating activities

Profit/(loss) before tax01XX(XX)

Adjustments for

Depreciation and amortisation02XXXX

Allowances and provisions

03XXXX

Unrealised foreign exchange (gains)/losses

04XX(XX)

(Profits)/losses from investing activities

05(XX)XX

Interest expense06XXXX

Operating profit/(loss) before changes in working capital08XX(XX)

(Increase)/decrease in receivables and other current assets09(XX)XX

Decrease/(increase) in inventories10XX(XX)

Increase/(decrease) in payables and other liabilities 11XX(XX)

(Increase)/decrease in prepayments12(XX)XX

(XX)XX

Interest paid13(XX)(XX)

Corporate income tax paid14(XX)(XX)

Other receipts from operating activities15XXXX

Other payments for operating activities16 (XX) (XX)

Net cash (used in)/generated from operating activities20(XX)XX

Cash flows from investing activities

Payments for additions to fixed assets and other long-term assets21(XX)(XX)

Proceeds from disposals of fixed assets and other long-term assets22XXXX

Payments for purchase of debt instruments of other entities23(XX)(XX)

Proceeds from sales of debt instruments of other entities24(XX)(XX)

Payments for investments in other entities25(XX)(XX)

Collections on investments in other entities26XXXX

Receipts of interests and dividends27XXXX

Net cash generated from/(used in) investing activities30XX(XX)

Cash flows from financing activities

Proceeds from equity issued31XXXX

Payments for shares returns and repurchases32(XX)(XX)

Proceeds from short-term and long-term borrowings33XXXX

Payments to settle debts 34(XX)(XX)

Payments to settle finance lease liabilities35(XX)(XX)

Payments of dividends36(XX)(XX)

Net cash generated from/(used in) financing activities40XX(XX)

Net cash flows during the [period/year]50(XX)XX

Cash and cash equivalents at the beginning of the [period/year]60XXXX

Impact of exchange rate fluctuations

61XX(XX)

Cash and cash equivalents at the end of the [period/year]703XXXX

Significant non-cash transactions

During the [period/year] there were the following significant non-cash transactions:

2006VND'0002005VND'000

Cost of fixed assets acquired by the Company as legal capital contributions from investorsXXXX

Cost of fixed assets acquired by the Company under finance leasesXXXX

Pre-operating expenses incurred by investors as legal capital contributionsXXXX

Acquisition of businesses by giving non-cash considerationsXXXX

Disposal of businesses for non-cash considerationsXXXX


NameName


These notes form an integral part of and should be read in conjunction with the accompanying financial statements.

1. Principal activities

The principal activities of [ABC Company Limited] (the Company), which is incorporated as a [100% foreign-owned company in Vietnam/joint venture company in Vietnam], are to [complete] under Investment Licence No XX issued by the [Ministry of Planning and Investment (MPI)] on [date month year] and amended on [date month year], [date month year], [date month year] and [date month year] (together referred to as the Investment Licence). The Investment Licence is valid for XX years from the initial investment licence date.

Paragraph 2, Case 1: normal disclosure

The total investment and legal capital amounts of the Company as stipulated in the Investment Licence and defined under the Law on Foreign Investment in Vietnam are USDXX and USDXX, respectively.Paragraph 2, Case 2: change of total invested capital in the current year

During the [period/year] the total investment and legal capital amounts of the Company were increased from USDXX to USDXX under revised Investment Licence No.XX dated [date month year].Paragraph 2, Case 3: liquidation of company

The total investment and legal capital amounts of the Company as stipulated in the investment licence and defined under the Law on Foreign Investment in Vietnam are USDXX and USDXX, respectively.On [date month year] the Directors applied to the [MPI] to liquidate the Company. In response to this request the Company received approval from the [MPI] to allow the Company to terminate its operations on [date month year].Paragraph 3 (mandatory)

As at [31 December 2006] the Company had XX employees (2005: XX employees).

2. Summary of significant accounting policies

The following significant accounting policies have been adopted by the Company in the preparation of these financial statements.

(a) Basis of financial statement preparation

(i) General basis of accounting (remove this heading if paragraph (ii) is not used)

Paragraph 1 (mandatory)

The financial statements, expressed in thousand Vietnam Dong (VND000)/United States Dollars (USD), have been prepared in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System and accounting principles generally accepted in Vietnam.Paragraph 2, first year of VAS application (if applicable)

Prior to [1 January 2006] the financial statements were prepared in accordance with International Financial Reporting Standards, issued by the International Accounting Standard Board. This change in the basis of accounting has been applied retrospectively in preparing the financial statements for the [period/year] ended [31 December 2006] and the comparative information presented for the year ended [31 December 2005].Paragraph 3 (mandatory)

The financial statements are prepared on the historical cost basis. During the year the Ministry of Finance has issued a number of new accounting standards that are effective for accounting periods beginning on or after 1 January 2006. Information on the changes in accounting policies resulting from initial application of these new accounting standards for the current and prior periods reflected in these financial statements is provided in Note 2 (b). Paragraph 4 (Consolidated financial statements have to be prepared unless the Company is itself wholly owned subsidiary of the parent company, which publishes consolidated financial statements)

Consolidated financial statements in accordance with Vietnamese Accounting Standards, the Vietnamese Accounting System and accounting principles generally accepted in Vietnam have not been prepared as the company is itself wholly owned subsidiary of XX, which publishes consolidated financial statements and has its registered office at XX.(ii) Going concern assumption

If applicable

The financial statements have been prepared on a going concern basis. The Company has incurred net loss after tax of VNDXX (2005: VNDXX) during the [period/year] and at the balance sheet date, current liabilities exceeded current assets by VNDXX (2005: VNDXX) and total liabilities exceeded total assets by VNDXX (2005: VNDXX). Furthermore, the Company has significant loans that will require refinancing within the next 12 months (Note XX). The validity of the going concern assumption fundamentally depends on the [investor/investors/ultimate holding company] continuing to provide such financial assistance as is necessary to enable the entity to meet its liabilities as and when they fall due and to maintain the entity in existence as a going concern for the foreseeable future.

At the time of this report, there is no reason for the [Directors/management] to believe that the [investor/investors/ultimate holding company] will not continue [its/their] support.(b) Adoption of new accounting policies

The Company adopted the following Vietnamese Accounting Standards issued by the Ministry of Finance that have become effective since 1 January 2006.

VAS 11 Business Combination;

VAS 18 Provisions, Contingent Assets and Liabilities

VAS 19 Insurance Contracts VAS 30 Earnings Per Share

Case 1: no restatement of corresponding figuresThe adoption of the new standards above did not result in restatements of prior year balances. [Certain comparative information has been reclassified to conform to the current year presentation.]Case 2: restatement of corresponding figures

The adoption of the new standards above was applied retrospectively and corresponding figures have been restated. The adoption of the new accounting standards had the following impact on these financial statements.

2006VND0002005

VND000

Balance sheet

[Details of captions affected]XXXX

XXXX

Statement of income

[Details of captions affected]XXXX

XXXX

(c) Fiscal year

Case 1: normal disclosure

The fiscal year of the Company is from [1 January] to [31 December] as approved by the Ministry of Finance in Letter No. XX dated [date month year].Case 2: first financial reporting period

The first fiscal period of the Company is from [date month year] to [31 December 2006] as approved by the Ministry of Finance in Letter No. XX dated [date month year]. Succeeding fiscal years will be from [1 January] to [31 December].

(d) Change in reporting currency

On [1 January 2006] the Company changed its reporting currency from United States Dollars (USD) to Vietnam Dong (VND). All balances in USD as at [31 December 2005], except for tangible fixed assets, have been translated from USD to VND at the exchange rate of VNDXX to USD1. Fixed assets have been translated from USD to VND at historical exchange rates. The foreign exchange differences that have arisen from this translation are recorded in the Differences Upon Asset Revaluation account in equity. These differences cannot be distributed until the Company is liquidated.

The corresponding figures in VND as at and for the [period/year] ended 31 December 2005, which are shown for information purposes only, have been calculated by translating the amounts in the financial statements as at 31 December 2005 at the exchange rate of VNDXX to USD1, except for fixed assets which are translated from USD to VND at historical rates.

(e) Foreign currency transactions

Monetary assets and liabilities denominated in currencies other than VND[, except for items hedged by financial instruments,] are translated into VND at rates of exchange ruling at the balance sheet date. Transactions in currencies other than VND during the [period/year] have been translated into VND at rates approximating those ruling at the transaction dates.

Case 1: normal disclosure

All realised and unrealised foreign exchange differences are recorded in the statement of income.

Case 2: disclosure where the company is pre-operating and construction stage

All realised and unrealised foreign exchange differences are recorded in statement of income, except when they relate to the construction of tangible fixed assets or the translation of foreign currency monetary items during the Companys pre-operating stage, in which case they are recorded in the Foreign Exchange Difference Account in equity until the Company commences operations and the tangible fixed assets are put into use. Once the Company commences operations and the tangible fixed assets are put into use, the related realised foreign exchange differences are transferred to the statement of income, unrealised foreign exchange gains are transferred to the Unearned Revenue Account and unrealised foreign exchange losses are transferred to the Long-term Prepayment Account. The unrealised gains and losses are then amortised on a straight line basis over five years.

(f) Cash and cash equivalentsCash comprises cash balances and call deposits. Cash equivalents are short-term highly liquid investments that are readily convertible to known amount of cash, are subject to an insignificant risk of changes in value, and are held for the purpose of meeting short- term cash commitments rather than for investment or other purposes. Bank overdrafts that are repayable on demand and form an integral part of the Companys cash management are included as a component of cash and cash equivalents for the purpose of the statement of cash flows.

(g) Investments

Investments are stated at cost. Allowance is made for reductions in investment values which in the opinion of the [Directors/management] are not temporary. The allowance is reversed if the subsequent increase in recoverable amount can be related objectively to an event occurring after the allowance was recognised. An allowance is reversed only to the extent that the investments carrying amount does not exceed the carrying amount that has been determined if no allowance had been recognised.

(h) Accounts receivable

Trade and other receivables are stated at cost less allowance for doubtful debts.

(i) Inventories

Inventories are stated at the lower of cost and net realisable value. Cost is determined on a [first-in-first-out /weighted average basis] and includes all costs incurred in bringing the inventories to their present location and condition. Cost in the case of finished goods and work in progress includes raw materials, direct labour and attributable manufacturing overheads. Net realisable value is the estimated selling price of inventory items, less the estimated costs of completion and selling expenses. The Company applies the [perpetual/periodic] method of accounting for inventory.

(j) Tangible fixed assets

(i) Cost

Tangible fixed assets are stated at cost less accumulated depreciation. The initial cost of a tangible fixed asset comprises its purchase price, including import duties, non-refundable purchase taxes and any directly attributable costs of bringing the asset to its working condition and location for its intended use. Expenditure incurred after tangible fixed assets have been put into operation, such as repairs and maintenance and overhaul costs, are normally charged to income in the [period/year] in which the costs are incurred. In situations where it can be clearly demonstrated that the expenditure have resulted in an increase in the future economic benefits expected to be obtained from the use of tangible fixed assets beyond their originally assessed standard of performance, the expenditure are capitalised as an additional cost of tangible fixed assets.

(ii) Depreciation

Depreciation is computed on a straight-line basis over the estimated useful lives of tangible fixed assets. The estimated useful lives are as follows:

buildingsXX XX years

leasehold improvementsXX XX years

office equipment XX XX years

plant and equipment XX XX years

fixtures and fittingsXX XX years

motor vehicles XX XX years

During the [period/year], the Company revised the estimated useful lives of motor vehicles from XX years to XX years to more accurately reflect the useful lives of these assets. The effect on the depreciation charge for the [period/year] was to [increase/decrease] the depreciation charge by VNDXX.

(k) Finance lease tangible fixed assets

Leases in terms of which the Company assumes substantially all the risks and rewards of ownership are classified as finance leases. Tangible fixed assets acquired by way of finance leases are stated at an amount equal to the lower of fair value and the present value of the minimum lease payments at inception of the lease, less accumulated depreciation.

Depreciation on leased assets is computed on a straight-line basis over the estimated useful lives of items of the leased assets. The estimated useful lives of leased assets are consistent with the useful lives of tangible fixed assets as described in accounting policy 2(j).

(l) Intangible fixed assets

(i) Land use rights

Land use rights are stated at cost less accumulated amortisation. The initial cost of a land use right comprises [the value of the right as stated in the Investment Licence/its purchase price] and any directly attributable costs incurred in conjunction with securing the land use right. Amortisation is computed on a straight-line basis over XX years.

(ii) Software

Cost of acquisition of new software, which is not an integral part of the related hardware, is capitalised and treated as an intangible asset. Software is amortised on a straight-line basis over XX years.

(iii) Development costs

Expenditure on development activities, whereby research findings are applied to a plan or design for the production of new or substantially improved products and process, is capitalised if the product or process is technically and commercially feasible and the Company has sufficient resources to complete development. The expenditure capitalised include the costs of materials, direct labour and an appropriate portion of overheads. Other development expenditure is recognised in the statement of income as an expense as incurred. Capitalised development expenditure is stated at cost less accumulated amortisation, which is provided on a straight-line basis over XX years.

(m) Investment property

(i) Cost

Investment property is stated at cost less accumulated depreciation. The initial cost of an investment property comprises its purchase price, cost of land use rights and any directly attributable costs of bringing the asset to its working condition for its intended use. Expenditure incurred after investment property has been put into operation, such as repairs and maintenance, are normally charged to income in the [period/year] in which the costs are incurred. In situations where it can be clearly demonstrated that the expenditure have resulted in future economic benefits in excess of the originally assessed standard of performance of the existing investment property, the expenditure are capitalised as an additional cost of investment property.

(ii) Depreciation

Depreciation is computed on a straight-line basis over the estimated useful lives of investment property. The estimated useful lives are as follows:

land use rightsXX XX years

buildingsXX XX years

During the [period/year], the Company revised the estimated useful lives of [land use rights/ buildings] from XX years to XX years to more accurately reflect the useful lives of these assets. The effect on the depreciation charge for the [period/year] was to [increase/decrease] the [depreciation] charge by VNDXX.

(n) Construction in progress

Construction in progress represents the cost of [construction and machinery] which have not been fully [completed or installed]. No depreciation is provided for construction in progress during the period of [construction and installation].

(o) Contract work-in-progress

Contract work-in-progress is stated at cost plus attributable profits earned to date less provision for foreseeable losses. Cost represents directly attributable and chargeable costs in accordance with the underlying contract.

(p) Long-term prepayments

(i) Pre-operating expenses

Pre-operating expenses are recorded in the statement of income, except for establishment costs and expenditures on training, advertising and promotional activities incurred from the incorporation date to the commercial operation date, being [the date of commencement of trial production]. These expenses are recognised as long-term prepayments, initially stated at cost, and are amortised on a straight line basis over three years starting from the date of commercial operation.

(ii) Technology assistance fees

Technology assistance fees are incurred for technology assistance provided by XX over XX years commencing from XX and are amortised on a straight-line basis over the term of the technology assistance contract.

(iii) Prepaid land costs

Prepaid land costs comprise prepaid land lease rentals and other costs incurred in conjunction with securing the use of leased land. These costs are recognised in the statement of income on a straight-line basis over the term of the lease of XX years.

(iv) Golf club memberships

Golf club memberships are recorded at cost and amortised on a straight-line basis over XX years.

(q) Trade and other payables

Trade and other payables are stated at their cost.

(r) Provisions

A provision is recognised if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. In respect of provision for warranty, the amount provided is limited to 5% of related revenue in accordance with Circular 13/2006/TT-BTC dated 27 February 2006.

(s) Taxation

Income tax on the profit or loss for the [period/year] comprises current and deferred tax. Income tax is recognised in the statement of income except to the extent that it relates to items recognised directly to equity, in which case it is recognised in equity.

Current tax is the expected tax payable on the taxable income for the [period/year], using tax rates enacted or substantially enacted at the balance sheet date, and any adjustment to tax payable in respect of previous [periods/years].

Deferred tax is provided using the balance sheet liability method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities using tax rates enacted or substantively enacted at the balance sheet date.

A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

(t) Revenue

(i) Goods sold

Revenue from the sale of goods is recognised in the statement of income when the significant risks and rewards of ownership have been transferred to the buyer. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due or the possible return of goods.

(ii) Services rendered

Revenue from services rendered is recognised in the statement of income in proportion to the stage of completion of the transaction at the balance sheet date. The stage of completion is assessed by reference to work performed. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due.

(iii) Processing services

Revenue from processing services is recognised in the statement of income when the goods have been processed and accepted by the buyer. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due.

(iv) Construction contracts

Revenue from construction contracts is recognised in the statement of income in proportion to the stage of completion of the contract when the outcome of a construction contract can be estimated reliably. The stage of completion is assessed by reference to surveys of work performed. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due.

(v) Rental income

Rental income from leased property is recognised in the statement of income on a straight-line basis over the term of the lease. Lease incentives granted are recognised as an integral part of the total rental income.

(u) Operating lease payments

Payments made under operating leases are recognised in the statement of income on a straight-line basis over the term of the lease. Lease incentives received are recognised in the statement of income as an integral part of the total lease expense.

(v) Borrowing costs

Borrowing costs are recognised as an expense in the [period/year] in which they are incurred, except where the borrowing costs relate to borrowings in respect of the construction of tangible fixed assets, in which case the borrowing costs incurred during the period of construction are capitalised as part of the cost of the fixed assets concerned.

(w) Earnings per share

The Company presents basic and diluted earnings per share (EPS) for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to the ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the [period/year]. Diluted EPS is determined by adjusting the profit or loss attributable to the ordinary shareholders and the weighted average number of ordinary shares outstanding for the effect of all dilutive potential ordinary shares, which comprise convertible bonds and share options.

(x) Related companies

Related companies include the [investor/investors] and [its/their] ultimate parent [company companies] and [its/their] subsidiaries and associates.

(y) Off balance sheet items

Amounts which are defined as off balance sheet items under the Vietnamese Accounting System are disclosed in the relevant notes to these financial statements.

3. Cash and cash equivalents2006VND0002005VND000

Cash on handXXXX

Cash in bankXXXX

Cash equivalents

XXXX

Cash and cash equivalentsXXXX

Bank overdrafts(XX)(XX)

Cash and cash equivalents in the statement of cash flowsXXXX

Cash at [31 December 2006] included amounts denominated in currencies other than VND amounting to VNDXX million (2005: VNDXX million).

Cash in bank at [31 December 2006] included VNDXX million (2005: VNDXX million) pledged with banks as security for loans granted to the Company.

Cash in bank at [31 December 2006] included VNDXX million (2005: VNDXX million) which is subject to restriction in use according to [specify legal or other applicable restriction].

4. Accounts receivable - short-term [and long-term]Inter-company receivables comprised:

2006VND0002005VND000

Amounts due from related companies

TradeXXXX

Non-tradeXXXX

XXXX

The non-trade amounts due from related companies were unsecured, interest free and had no fixed terms of repayment.

Excess of contract work-in-progress over progress billings and advances from customers comprised:

2006VND0002005VND000

Contract work-in-progressXXXX

Attributable profits based on percentage of completionXXXX

XXXX

XXXX

Progress billings and advances from customers(XX)(XX)

XXXX

Provision for foreseeable losses(XX)(XX)

XXXX

Movements in the provision for foreseeable losses during the [period/year] were as follows:

2006VND0002005VND000

Opening balanceXXXX

Increase in provision during the [period/year]XX XX

Utilised during the [period/year](XX)(XX)

Closing balanceXXXX

Other receivables comprised:2006VND0002005VND000

AdvancesXXXX

Short-term depositsXXXX

OthersXXXX

XXXX

Movements in the allowance for doubtful debts during the [period/year] were as follows:

2006VND0002005VND000

Opening balanceXXXX

Increase in allowance during the [period/year]XXXX

Allowance utilised during the [period/year](XX)(XX)

Written back(XX)(XX)

Closing balanceXXXX

Allowance for doubtful debts - long-term(XX)(XX)

Allowance for doubtful debts - short-termXXXX

At [31 December 2006] accounts receivable with a carrying value of VNDXX million (2005: VNDXX million) were pledged with banks as security for loans granted to the Company.

5. Inventories

2006VND0002005VND000

Goods in transit

XXXX

Raw materialsXXXX

Tools and suppliesXXXX

Work in progressXXXX

Finished goodsXXXX

Merchandise inventoryXXXX

Goods on consignmentXXXX

PropertiesXXXX

XXXX

Allowance for inventories(XX)(XX)

XXXX

Movements in the allowance for inventories during the [period/year] were as follows:

2006VND0002005VND000

Opening balanceXXXX

Increase in allowance during the [period/year]XXXX

Allowance utilised during the [period/year](XX)(XX)

Written back(XX)(XX)

Closing balanceXXXX

At [31 December 2006] inventories with a carrying value of VNDXX million (2005: VNDXX million) were pledged with banks as security for loans granted to the Company.

Included in finished goods at [31 December 2006] was VNDXX million (2005: VNDXX million) of inventories carried at net realisable value.

6. Taxes and other receivables from State Treasury2006VND0002005VND000

Taxes over-paid to State Treasury

Corporate income taxXXXX

Special consumption taxXXXX

Import-export taxXXXX

Natural resource taxesXXXX

Land and housing taxesXXXX

Other taxesXXXX

Other receivables from State TreasuryXXXX

XXXX

7. Tangible fixed assets

BuildingsLeasehold improvementsOffice equipmentPlant and equipmentFixtures and fittingsMotor vehiclesTotal

VND000VND000VND000VND000VND000VND000VND000

Cost

Opening balanceXXXXXXXXXXXXXX

AdditionsXXXXXXXXXXXXXX

Transfers from construction in progressXXXXXXXXXXXXXX

Transfers [from/(to)] investment property(XX)-----(XX)

Disposals(XX)(XX)(XX)(XX)(XX)(XX)(XX)

Written off(XX)(XX)(XX)(XX)(XX)(XX)(XX)

Reclassifications--(XX)XX---

Closing balanceXXXXXXXXXXXXXX

Accumulated depreciation

Opening balanceXXXXXXXXXXXXXX

Charge for the [period/year] XXXXXXXXXXXXXX

Transfers [from/(to)] investment property(XX)-----(XX)

Disposals (XX)(XX)(XX)(XX)(XX)(XX)(XX)

Written off(XX)(XX)(XX)(XX)(XX)(XX)(XX)

Reclassifications--XX(XX)---

Closing balanceXXXXXXXXXXXXXX

Net book value

Closing balance XXXXXXXXXXXXXX

Opening balance XXXXXXXXXXXXXX

Included in the cost of tangible fixed assets were assets costing VNDXX million which were fully depreciated as of [31 December 2006] (2005: VNDXX million), but which are still in active use.

The carrying amount of tangible fixed assets retired from active use and held for disposal amounted to VNDXX million as of [31 December 2006] (2005: VNDXX million).

The carrying amount of temporarily idle equipment in tangible fixed assets amounted to VNDXX million as of [31 December 2006] (2005: VNDXX million).

During the [period/year] borrowing costs capitalised in tangible fixed assets amounted to VNDXX million (2005: VNDXX million).

At [31 December 2006] tangible fixed assets with a carrying value of VNDXX million (2005: VNDXX million) were pledged with banks as security for loans granted to the Company.

8. Finance lease tangible fixed assets

BuildingsOffice equipmentPlant and equipmentMotor vehiclesTotal

VND000VND000VND000VND000VND000

Cost

Opening balanceXXXXXXXXXX

AdditionsXXXXXXXXXX

Transfers to investment property(XX)---(XX)

Disposals(XX)(XX)(XX)(XX)(XX)

Written off(XX)(XX)(XX)(XX)(XX)

Reclassifications-(XX)XX--

Closing balanceXXXXXXXXXX



Charge for the [period/year] XXXXXXXXXX

Transfers to investment property(XX)---(XX)

Disposals (XX)(XX)(XX)(XX)(XX)

Written off(XX)(XX)(XX)(XX)(XX)

Reclassifications-XX(XX)--


Net book value

Closing balance XXXXXXXXXX

Opening balance XXXXXXXXXX

The Company leases production equipment under various finance lease agreements. At the end of each of the leases the Company has the option to purchase the equipment at a beneficial price. The leased equipment secures the lease obligations.

Included in the cost of finance lease tangible fixed assets were assets costing VNDXX million which were fully depreciated as of [31 December 2006] (2005: VNDXX million), but which were still in active use.

The carrying amount of finance lease tangible fixed assets retired from active use and held for disposal amounted to VNDXX million as of [31 December 2006] (2005: VNDXX million).

The carrying amount of temporarily idle equipment in finance lease tangible fixed assets amounted to VNDXX million as of [31 December 2006] (2005: VNDXX million).

During the [period/year] the contingent rent of the Companys finance lease tangible fixed assets recognised in the statement of income amounted to VNDXX million (2005: VNDXX million). The contingent rent is based on [complete based on Companys specific circumstances].9. Intangible fixed assets

Land use rightsDevelopment costsSoftwareTotal

VND000VND000VND000VND000

Cost

Opening balanceXXXXXXXX

Transfers from long-term prepaymentsXX--XX

Transfers [from/(to)] investment property(XX)--(XX)

AdditionsXXXXXXXX

Disposals(XX)(XX)(XX)(XX)

Written off(XX)(XX)(XX)(XX)

Closing balanceXXXXXXXX

Accumulated amortisation


Transfers from long-term prepaymentsXX--XX

Transfers [from/(to)] investment property(XX)--(XX)

Charge for the [period/year] XXXXXXXX

Disposals (XX)(XX)(XX)(XX)

Written off(XX)(XX)(XX)(XX)


Net book value

Closing balance XXXXXXXX

Opening balance XXXXXXXX

Included in the cost of intangible fixed assets were assets costing VNDXX million which were fully amortised as of [31 December 2006] (2005: VNDXX million), but which are still in use.

At [31 December 2006] intangible fixed assets with a carrying value of VNDXX million (2005: VNDXX million) were pledged with banks as security for loans granted to the Company.

10. Construction in progress

2006VND0002005VND000

Opening balanceXXXX

Additions during the [period/year]XXXX

Written off(XX)(XX)

Transfers to tangible fixed assets (XX)(XX)

Closing balanceXXXX

At [31 December 2006] construction in progress with a carrying value of VNDXX million (2005: VNDXX million) were pledged with banks as security for loans granted to the Company.During the [period/year], borrowing costs capitalised into construction in progress amounted to VNDXX million (2005: VNDXX million).

11. Investment property

Land use rightsBuildingsTotal

VND000VND000VND000

Cost

Opening balanceXXXXXX

New acquisitionsXXXXXX

Capitalised subsequent expenditureXXXXXX

Transfer [from/(to)] tangible fixed assets(XX)(XX)(XX)

Disposals(XX)(XX)(XX)

Closing balanceXXXXXX


Opening balanceXXXXXX

Charge for the [period/year] XXXXXX

Transfer [from/(to)] tangible fixed assets(XX)(XX)(XX)

Disposals (XX)(XX)(XX)

Closing balanceXXXXXX

Net book value

Closing balance XXXXXX

Opening balance XXXXXX

Case 1: Fair value information is available.

At [31 December 2006] the fair value of the Companys investment property as determined by [the Directors/independent valuers] is VNDXX million (2005: VNDXX million).

Case 2: Fair value information is not available.

The Companys investment property is [an apartment building located at XX].The fair value of investment property has not been determined as [the Company has not performed a valuation/there was no recent market transaction for similar property in the same location as the Companys investment property/there is no active market for such property].12. Investments

2006VND0002005VND000

Long term equity investments in:

SubsidiariesXXXX

AssociatesXXXX

joint venturesXXXX

others XXXX

Long-term corporate bondsXXXX

Long term treasury bonds

Long-term loansXXXX

Other long term investmentsXXXX

XXXX

Allowance for diminution in value of long-term investments(XX)(XX)

XXXX

Short term investments in:

securitiesXXXX

term depositsXXXX

XXXX

Allowance for diminution in value of short-term investments(XX)(XX)

XXXX

Movements in the allowance for diminution in value of investments during the [period/year] were as follows:

Short-termLong-term

2006VND0002005VND0002006VND0002005VND000


Increase in allowance during the [period/year]XXXXXXXX

Allowance utilised during the [period/year](XX)(XX)(XX)(XX)

Written back(XX)(XX)(XX)(XX)


At [31 December 2006] [short-term/long-term] investments with a carrying value of VNDXX million (2005: VNDXX million) were pledged with banks as security for loans granted to the Company.

Details of the investments in subsidiaries and associates are as follows:

NamePrincipal activityInvestment

licence % of ownershipAmount

2006USD2005USD

Subsidiaries

[Name of Subsidiary 1]

[Business activities of Subsidiary 1]

XX/GP issued by [MPI] on [date] and amended on [date].XX%

XXXX

[Name of Subsidiary 2]

[Business activities of Subsidiary 2]


XXXX

Associate

[Name of Associate 1]

[Business activities of Associate 1]


XXXX

XXXX

13. Long-term prepayments

Pre-operating expensesTechnology assistance feesPrepaid land costsGolf club membershipsForeign exchange differencesTotal

VND000VND000VND000VND000VND000VND000

Opening balance-XXXXXXXXXX

Transfers from foreign exchange difference account----XXXX

AdditionsXXXXXXXXXXXX

Disposals(XX)(XX)(XX)(XX)(XX)(XX)

Written off(XX)(XX)(XX)(XX)(XX)(XX)

Amortisation for the [period/year] (XX)(XX)(XX)(XX)(XX)(XX)

Closing balanceXXXXXXXXXXXX

14. Deferred tax assets and liabilities(i) Recognised deferred tax assets

Deferred tax assets are attributable to the following:

2006VND'0002005VND'000

Fixed assetsXXXX

Allowances and provisions XXXX

Tax value of loss carry-forwards recognisedXXXX

Other itemsXXXX

XXXX

(ii) Unrecognised deferred tax assets

Deferred tax assets have not been recognised in respect of the following items:

2006VND'0002005VND000

Deductible temporary differencesXXXX

Tax lossesXXXX

XXXX

The tax losses expire in [2007./the following years:]

Year of expiryStatus of tax reviewTax losses available

VND000

2007FinalisedXX

2008FinalisedXX

2009OutstandingXX

2010OutstandingXX

2011OutstandingXX

XX

The deductible temporary differences do not expire under current tax legislation. Deferred tax assets have not been recognised in respect of these items because it is not probable that future taxable profit will be available against which the Company can utilise the benefits therefrom.

(iii) Recognised deferred tax liabilitiesDeferred tax liabilities are attributable to the following:

2006

VND'0002005

VND'000

Fixed assetsXXXX

Allowances and provisions (XX)(XX)

Tax value of loss carry-forwards recognised(XX)(XX)

Other itemsXXXX

XXXX

(iv) Movement in temporary differences during the [peiod/year][Not required if the amount of deferred tax recognised in the statement of income is apparent from the changes in the deferred tax balances]

2005Recognised in incomeRecognised in equity2006

Fixed assetsXX(XX)XX(XX)

Allowances and provisions(XX)(XX)-(XX)

Tax value of loss carry-forwards recognised(XX)(XX)-(XX)

Other itemsXXXXXXXX

(XX)(XX)XX(XX)

15. Short-term borrowings and liabilities

2006VND0002005VND000

Short-term borrowingsXXXX

Current portion of long-term liabilitiesXXXX

Current portion of finance lease liabilitiesXXXX

Matured bondsXXXX

XXXX

[Disclose amount of borrowings that are secured and unsecured, nature of security and interest rate range. Also disclose amount of borrowings from related company]

At [31 December 2006], VNDXX million (2005: VNDXX million) of the short-term borrowings were due to a related company and were [secured by XX/unsecured]. VNDXX million (2005: VNDXX million) of the remaining short-term borrowings were secured by XX. The remaining short-term borrowings were unsecured. The borrowings bore interest at rates ranging from XX% to XX% (2005: XX% to XX%) per annum during the [period/year].

16. Taxes payable to State Treasury

2006VND0002005VND000

Taxes

Value added taxXXXX

Special consumption taxXXXX

Import-export taxXXXX

Corporate income taxXXXX

Personal income taxXXXX

Natural resource taxesXXXX

Land and housing taxesXXXX

Land rentalXXXX

Other taxesXXXX

Other obligations

Extra collectionsXXXX

DutiesXXXX

Other obligationsXXXX

XXXX

17. Accrued expenses2006VND0002005VND000

(nature of accrued expenses)XXXX

(nature of accrued expenses)XXXX

OthersXXXX

XXXX

18. Inter-company payables

2006VND0002005VND000

Amounts due to related companies

TradeXXXX

Non-tradeXXXX

XXXX

Repayable within twelve months(XX)(XX)

Repayable after twelve monthsXXXX

The non-trade amounts due to related companies were unsecured, interest free and had no fixed terms of repayment.

19. Excess of progress billings over contract work-in-progress

Excess of progress billings and advances from customers over contract work-in-progress comprised:

2006VND0002005VND000

Contract work-in-progressXXXX

Attributable profits based on percentage of completionXXXX

XXXX

Progress billings and advances from customers(XX)(XX)

(XX)(XX)

Provision for foreseeable losses(XX)(XX)

(XX)(XX)

Movements in the provision for foreseeable losses during the [period/year] were as follows:

2006VND0002005VND000

Opening balanceXXXX

Increase in provision during the [period/year]XX XX

Utilised during the [period/year](XX)(XX)

Closing balanceXXXX

20. Other payablesOther payables comprised:

2006VND0002005VND000

Social insuranceXXXX

Health insuranceXXXX

Short-term deposits and collaterals receivedXXXX

Unearned revenueXXXX

OthersXXXX

XXXX

21. ProvisionsMovement of provisions during the [period/year] were as follows:

Site restorationWarrantiesSubtotalSeverance allowanceTotal

VND000VND000VND000VND000VND000


Provision made during the [period/year]XXXXXXXXXX

Provision used during the [period/year](XX)(XX)(XX)(XX)(XX)

Provision reversed during the [period/year](XX)(XX)(XX)(XX)(XX)

Unwind of discountXXXXXXXXXX


Non-currentXXXXXXXXXX

CurrentXXXXXXXXXX

XXXXXXXXXX

(i) Site restoration[In accordance with the Investment Licence, the Company has the obligation to restore the land on which its factory is located to its original condition at the end of its licensed period. The provision has been calculated using a discount rate of XX%. The restoration costs are expected to be incurred at the end of the licensed period. Amount provided during the [peiod/year] has been capitalised as an item of tangible fixed assets.]

(ii) Warranties[The provision for warranties relates mainly to goods sold and services rendered during the year ended [31 December 2006] and 2005. The provision is based on estimates derived from historical warranty data associated with similar products and services..

(iii) Severance allowance[Under the Vietnamese Labour Code, when an employee who has worked for his/her employer for 12 months or more voluntarily terminates his/her labour contract, the employer is required to pay the employee a severance allowance based on the number of years of service. Provision for severance allowance is calculated based on employees current salary level and their service time. ]

22. Long-term borrowings and liabilities

2006VND0002005VND000

Long-term borrowings

Loan 1 from XX Bank (a)XXXX

Loan 2 from XX Bank (b)XXXX

XXXX

Finance lease liabilities (c)XXXX

Long-term bonds issued (d)XXXX

Other long-term liabilitiesXXXX

XXXX

Repayable within twelve months(XX)(XX)

Repayable after twelve monthsXXXX

[Disclose if borrowings are secured or unsecured, nature of security and net book value of assets pledged, repayment terms and interest rate range]a.This loan is secured by a fixed deposit of VNDXX million (2005: VNDXX million) pledged with the lender. The loan bore interest at rates ranging from XX% to XX% (2005: XX%) per annum during the [period/year] and the remaining balance at [31 December 2006] is repayable in XX equal quarterly installments of VND XX each.b.This loan is secured by fixed assets with net book value as at [31 December 2006] of VNDXX million (2005: VNDXX million) and a fixed deposit included in cash at bank of VNDXX million (2005: VNDXX million). The loan bore interest at rates ranging from XX% to XX% (2005: XX% to XX%) per annum during the [period/year]. The loan is repayable in XX equal semi-annual instalments amounting to VNDXX million each and a final instalment comprising the remaining balance, commencing one year after the drawdown date of [date month year].

c.The future minimum lease payments under non-cancellable finance leases were:

2006VND0002005VND000

PaymentsInterestPrincipalPaymentsInterestPrincipal

Within one yearXXXXXXXXXXXX

Within two to five yearsXXXXXXXXXXXX

More than five yearsXXXXXXXXXXXX

XXXXXXXXXXXX

d.Long-term bonds represent those issued on [insert date of issuance] with a term of [insert term of bonds]. The bonds were unsecured, bore interest at rates ranging from XX% to XX% (2005: XX%) per annum during the [period/year] and the remaining balance at [31 December 2006] is redeemable in XX equal quarterly installments of VND XX each.

23. Contributed capital

Case 1: Foreign invested company or limited company which does not issue shares

[Disclosed authorised and contributed capital, movements in contributed capital, immediate and ultimate parent companies]

Paragraph 1a: Authorised capital

The Companys authorised and contributed legal capital are:AuthorisedContributed

USD%USDEquivalent

VND000%

Party AXXXX%XXXXXX%

Party BXXXX%XXXXXX%

Party CXXXX%XXXXXX%

XX100%XXXX100%

Paragraph 1b: Authorised capital (alternative where there is one investor and the capital has been fully contributed)

The Companys authorised legal capital has been fully contributed by [investors name], which is incorporated in [country].Paragraph 2: Movements in contributed legal capital if there had been movements in the current year.

Movements in contributed legal capital during the [period/year] were as follows:

2006VND0002006VND000

Balance at beginning of the [period/year]XXXX

Withdrawal of capital by [insert Investors name]XXXX

Capital contribution by extension of land use rights XXXX

Cash contribution by [insert Investors name]XXXX

Balance at end of the [period/year]XXXX

Paragraph 3: parent company

The parent company, [complete name], and the ultimate parent company [complete name], are incorporated in [country] and [country], respectively.

Paragraph 4: outstanding capital contributions

If the legal capital has not been fully contributed and the remaining legal capital will be contributed in future in accordance with the feasibility study.

The remaining legal capital is due to be contributed in accordance with the following timetable as set out in the Companys feasibility study:

Year2006VND0002005VND000

2007XXXX

2008XXXX

2009XXXX

2010XXXX

EtcXXXX

XXXX

If the legal capital has not been contributed in accordance with the feasibility study.

The investors have not fully contributed the legal capital in accordance with the timetable set out in the feasibility study because [explain reason and proposed remedial action, ie how/when the legal capital will be contributed].

Case 2: Joint stock company

The Companys authorised and issued share capital are:20062005

Number of sharesVND000Number of sharesVND000

Authorised share capitalXXXXXXXX

Issued share capital

Ordinary sharesXXXXXXXX

Preference sharesXXXXXXXX

XXXXXXXX

Treasury shares



XXXXXXXX

Shares currently in circulation



XXXXXXXX

All ordinary shares have a par value of VNDXX. Each share is entitled to one vote at meetings of the Company. Shareholders are entitled to receive dividend as declared from time to time. All ordinary shares are ranked equally with regard to the Companys residual assets. In respect of shares bought back by the Company, all rights are suspended until those shares are reissued

Preference shares have a par value of VNDXX. These are not entitled to vote at meetings of the Company. [Describe dividend schemes applicable to preference shares].Movement in share capital during the [period/year] was as follows:

20062005

Number of sharesVND000Number of sharesVND000

Balance at the beginning of the [period/year]XXXXXXXX

Shares issued during the [period/year]XXXXXXXX

Treasury shares purchased during the [period/year](XX)(XX)(XX)(XX)

Reduction in share capital during the [period/year](XX)(XX)(XX)(XX)

Balance at the end of the [period/year]XXXXXXXX

24. Foreign exchange differences

2006VND0002005VND000

Balance at beginning of the [period/year]XXXX

Net exchange differencesXXXX

Transfers to long-term prepayment and/or unearned revenueXXXX

Balance at end of the [period/year]XXXX

25. Financial reserve

Prior to 1 July 2000, the Law on Foreign Investment in Vietnam required foreign invested joint venture companies to allocate 5% of their profit after tax for the year to a non-distributable legal reserve which should not exceed 10% of the Companys legal capital. This requirement was abolished from 1 July 2000. Accordingly, the Company has not made additional allocations to this reserve. The Ministry of Finance has permitted enterprises to either maintain this reserve or transfer it to distributable earnings. The Company has elected to [transfer the balance of the reserve to retained earnings during the year/maintain the balance of the reserve]26. Total revenue

Total revenue represents the gross invoiced value of goods sold and services rendered exclusive of value added tax.Net sales comprised

2006VND0002005VND000

Total revenue

SalesXXXX

ServicesXXXX

Rental income from investment propertyXXXX

Construction contractXXXX

Less sales deductions

Sales discounts(XX)(XX)

Sales allowances(XX)(XX)

Sales returns(XX)(XX)

Special sales taxes (XX)(XX)

Export duties(XX)(XX)

Net salesXXXX

27. Cost of sales

2006VND0002005VND000

Total cost of sales

Finished goods soldXXXX

Merchandise goods soldXXXX

Services providedXXXX

Rental of investment propertyXXXX

Construction contractXXXX

Inventory lossesXXXX

Allowance for inventoriesXXXX

XXXX

28. Financial income

2006VND0002005VND000

Interest income

Related partiesXXXX

BanksXXXX

OthersXXXX

Income from investments XXXX

Dividends XXXX

Gains from trade on foreign currencyXXXX

Foreign exchange gainsXXXX

Other financial incomeXXXX

XXXX

29. Financial expenses

2006VND0002005VND000

Interest expenses payable to

Related partiesXXXX

BanksXXXX

OthersXXXX

Loss from disposal of short term investmentsXXXX

Allowance for short-term and long-term investmentsXXXX

Loss from trade on foreign currencyXXXX

Foreign exchange lossesXXXX

XXXX

30. Other income

2006VND0002005VND000

Gains on disposals of tangible fixed assetsXXXX

Gains on disposals of intangible fixed assetsXXXX

Bad debts recoveredXXXX

Compensation received from other partiesXXXX

Income not previously recorded XXXX

XXXX

31. Other expenses

2006VND0002005VND000

Losses on disposals of tangible fixed assetsXXXX

Losses on disposals of intangible fixed assetsXXXX

Compensation paid for breaches of contractsXXXX

Tax penaltiesXXXX

XXXX

32. Corporate income tax

Example 1: Where the Company has incurred a tax loss, has no deferred tax and has not yet triggered the tax holiday period

Reconciliation of effective tax rate

2006

VND0002005

VND000

Loss before tax(XX)(XX)

Tax at CIT rate applicable in Investment Licence(XX)(XX)

Non-deductible expensesXXXX

Tax exempt income(XX)(XX)

(XX)(XX)

Deferred tax asset not recognisedXXXX

XXXX

Deferred tax asset on tax losses has not been recognised as it is not probable that future taxable profits will be available against which the asset can be utilised.(a) Applicable tax rates

Under the terms of its Investment Licence the Company has an obligation to pay the government CIT at the rate of [XX%] of taxable profits for the first [XX] years starting from the first year of operation and [XX%] for the succeeding years. However, the provisions of the Companys Investment Licence allow the Company to be exempt from CIT for [XX] years starting from the first year it generates a taxable profit, and entitled to a [XX%] reduction in CIT for the [XX] succeeding years.

Example 2: Where the Company has no current year tax expense due to the effect of tax holidays

Recognised in the statement of income

2006

VND0002005

VND000

Deferred tax expense/(income)

Origination and reversal of temporary differencesXX(XX)

Reduction in tax rate(XX)(XX)

Benefit of tax losses recognised(XX)(XX)

Write down/(reversal of write down) of deferred tax assetXX(XX)

XX(XX)

Reconciliation of effective tax rate

2006

VND0002005

VND000

[Profit/(loss)] before taxXX(XX)

Tax at CIT rate applicable in investment licenceXX(XX)



Tax losses utilised(XX)-

XX(XX)

Effect of tax holiday(XX)-

XX(XX)

(b) Applicable tax rates

Under the terms of its Investment Licence the Company has an obligation to pay the government CIT at the rate of [XX%] of taxable profits for the first [XX] years starting from the first year of operation and [XX] for the succeeding years. The provisions of the Companys investment licence allow the Company to be exempt from CIT for 2006 and [2007] and receive a [50%] reduction in CIT for the [three] succeeding years [(2008 to 2010)].

Example 3: Where the Company has a current year tax expense

(c) Recognised in the statement of income

2006VND0002005VND000

Current tax expense

Current yearXXXX

Under/(over) provision in prior yearsXX(XX)

XXXX

Deferred tax expense/(income)

Origination and reversal of temporary differencesXX(XX)

Reduction in tax rate(XX)(XX)

Benefit of tax losses recognised(XX)(XX)

Write down/(reversal of write down) of deferred tax assetXX(XX)

XX(XX)

Corporate income tax (CIT)XXXX

[If there is a deferred tax impact from changes in tax rate]The tax rate applicable to deferred taxation has reduced from XX% to XX% due to [state reason].(d) Reconciliation of effective tax rate

2006

VND0002005

VND000

[Profit/(loss)] before taxXX(XX)

Tax at CIT rate applicable in investment licenceXX(XX)



Tax losses utilised(XX)(XX)

Under/(over) provision in prior years(XX)XX

XXXX

(e) Applicable tax rates

Under the terms of its Investment Licence the Company has an obligation to pay the government CIT at the rate of [XX%] of taxable profits for the first [XX] years starting from the first year of operation and [XX%] for the succeeding years. The provisions of the Companys investment licence allow the Company to be exempt from CIT for [2004] and receive a [XX%] reduction in CIT for the [three] succeeding years [(2005 to 2007)].

33. Earnings per share

[This note is only applicable to listed companies or companies going for IPO]

(a) Basic earnings per share

The calculation of basic earnings per share at [31 December 2006] was based on the profit attributable to ordinary shareholders of VNDXX (2005: VNDXX) and a weighted average number of ordinary shares outstanding of XX (2005: XX), calculated as follows:(i) Net profit attributable to ordinary shareholders

20062005

VND000VND000

Net profit for the [period/year]XXXX

Dividend on preference shares(XX)(XX)

Net profit attributable to ordinary shareholdersXXXX

(ii) Weighted average number of ordinary shares

20062005

VND000VND000

Issued ordinary shares at the beginning of the [period/year]XXXX

Effect of own shares held(XX)(XX)

Effect of shares issued in [time of issuance]XXXX

Effect of share reduction in [time of reduction](XX)(XX)

Weighted average number of ordinary shares as at [31 December 2006]XXXX

(b) Diluted earnings per share

The calculation of diluted earnings per share at [31 December 2006] was based on the profit attributable to ordinary shareholders of VNDXX (2005: VNDXX) and a weighted average number of ordinary shares outstanding after adjustment for the effects of all dilutive potential ordinary shares of XX (2005: XX), calculated as follows:

(i) Net profit attributable to ordinary shareholders (diluted)20062005

VND000VND000

Net profit attributable to ordinary shareholders (basic)XXXX

Interest expenses on convertible bonds, net of tax(XX)(XX)

Net profit attributable to ordinary shareholders (diluted)XXXX

(ii) Weighted average number of ordinary shares (diluted)20062005

VND000VND000

Weighted average number of ordinary shares (basic)XXXX

Effect of conversion of convertible bondsXXXX

Effect of shares options on issueXXXX

Weighted average number of ordinary shares (diluted) as at [31 December 2006]XXXX

34. Dividends

Subsequent to the financial year-end a dividend of VND XX has been declared. The amount payable has not been accrued in these financial statements.

35. Significant transactions with related parties

During the [period/year] there were the following significant transactions with related parties:

Related PartyRelationshipNature of transaction2006VND0002005VND000

XXXUltimate holding companyPurchases of fixed assetsXXXX

XXXUltimate holding companyPurchases of materialsXXXX

XXXUltimate holding companyRoyalties payableXXXX

XXXParent companyPurchases of fixed assetsXXXX

XXXParent companyPurchases of materialsXXXX

XXXParent companySales of finished goodsXXXX

XXXRelated companySales of finished goodsXXXX

XXXMember of Board of DirectorsWarehouse rentalsXXXX

36. Commitments

(a) Capital expenditure

As at [31 December 2006] the Company had the following outstanding capital commitments approved but not provided for in the balance sheet:

2006VND0002005VND000

Approved but not contractedXXXX

Approved and contractedXXXX

XXXX

(b) Leases

The future minimum lease payments under non-cancellable operating leases were:

2006VND0002005VND000

Within one yearXXXX

Within two to five yearsXXXX

More than five yearsXXXX

XXXX

37. Foreign exchange contracts

The Company had the following commitments under foreign exchange contracts to purchase USD at [31 December 2006]:

2006VND0002005VND000

Forward foreign exchange contract commitmentsXXXX

38. Contingencies

[Insert discussion of any contingencies including estimated financial impact, uncertainties about its amounts, timing and possible compensations for losses]

39. Production and business costs by element

2006VND0002005VND000

Raw material costs included in production costs

XXXX

Labour costs and staff costs

XXXX

Depreciation and amortisation

XXXX

Outside services

XXXX

Other expenses XXXX

40. Corresponding figures

Case 1: second year reporting, if reclassifications have been made

Certain corresponding figures have been reclassified to conform with the current [period/year]'s presentation as follows:(a) Balance sheet20052005

(Reclassified)(as previously reported)

VND000VND000

Cash and cash equivalentXXXX

Short-term investmentsXXXX

Account receivables- tradeXXXX

Intercompany receivablesXXXX

TradeXXXX

Non tradeXXXX

Deductible value added taxXXXX

Taxes and other receivables from State TreasuryXXXX

Accrued expensesXXXX

Other payablesXXXX

Tax payables to State TreasuryXXXX

Provision for severance allowancesXXXX

ProvisionsXXXX

(b) Statement of incomeFinancial incomeXXXX

Financial expenseXXXX

Selling expenseXXXX

General and administrative expenseXXXX

Case 2: first reporting period

There are no corresponding figures as this is the first set of financial statements prepared by the Company since its incorporation.

Case 3: second year reporting is not corresponding to first reporting period

The prior period corresponding balances are for the period from the Companys date of corporation of [date] to [date].


NameName


PAGE \# "'Page: '#''" Page: 1Same as Investment Licence

Based on the Law on Accounting No 03/2003/QH11, the financial statements must be signed by the chief accountant and the legal representative of the company (normally referring the general director).

Can we show this I the notes like we used to?

Allowances and Provisions include Allowances for Inventory, Receivables and Investments and Liability Provisions.

PAGE \# "'Page: '#''" Page: 12Only include unrealised FED on accounts other than unrealised FED on cash and cash equivalents.

Including fixed assets disposal, interest income.

PAGE \# "'Page: '#''" Page: 12Only disclose the increase /(decrease) in payables other than accrued interest, corporate income tax.

PAGE \# "'Page: '#''" Page: 13Only include principal prepayments

PAGE \# "'Page: '#''" Page: 13Only include unrealised FED on cash and cash equivalents (VAS 24 Paragraphs 21 & 31, Page 225)

PAGE \# "'Page: '#''" Only state the current operating activities

Delete if financial instrument hedges are not used by the client.

PAGE \# "'Page: '#''" Page: 18VAS 10 Paragraphs 12b, Page 185

PAGE \# "'Page: '#''" Page: 18Maximum period of 5 years. VAS 10 Paragraphs 12a, Page 185

PAGE \# "'Page: '#''" Page: 19Delete last sentence if not applicable

PAGE \# "'Page: '#''" Page: 20Select one of the two options.

PAGE \# "'Page: '#''" Page: 20Ensure the above assets categories agree with the tangible fixed assets note.

PAGE \# "'Page: '#''" Page: 20Delete if not applicable

PAGE \# "'Page: '#''" Page: 21Only applicable to situations where the company holds a land use right certificate. If the Company does not hold a LUR Certificate then payments should be treated as prepaid land costs under long term prepayments.

The first option when LUR is contributed. Second option when it is purchased.

Delete if not applicable.

Only establishment costs, expenditure on training activities, expenditure on advertising and promotional activities incurred in the pre-operating phase can be either charged to statement of income or deferred and allocated to statement of income over a maximum of three years.

Delete if there no provision for warranty.

PAGE \# "'Page: '#''" Page: 24Delete if not applicable

Only applicable to listed companies or companies going for IPO.

An investment normally qualifies as a cash equivalent only when it has a short maturity of three months or less from the date of acquisition.

Used for goods purchased not for goods sent out for sales

PAGE \# "'Page: '#''" Page: 29Only disclose the amount of borrowing costs capitalised during the period (VAS 16 Paragraph 22b, Page 214)

Describe the property.

VAS 17 requires disclosure of deductible temporary differences and tax losses NOT the amounts of related deferred tax assets.

Disclose the tax losses, not the credit on the tax losses.

To be customised to specific circumstances

To be customised to specific circumstances

PAGE \# "'Page: '#''" Page: 36These examples should be customised for the specific situation.

This example should be customised for the specific situation.

PAGE \# "'Page: '#''" Page: 36Authorised and contributed columns can be combined if authorised capital is fully contributed.

Required by VAS 26-Paragraphs 22 Related party disclosures and Circular 55/2002/TT-BTC dated 26 June 2002.

PAGE \# "'Page: '#''" Raw Material Purchases + Opening RM Closing RM.

PAGE \# "'Page: '#''" Labour costs and staff costs is agreed with salary, related expenses and bonus expenses in Note 32.

PAGE \# "'Page: '#''" Total depreciation and amortisation charge during the year (from Fixed Assets and Long Term Asset Notes). It is also agreed with depreciation and amortisation on Statement of Cash Flows.

PAGE \# "'Page: '#''" Total of charges for electricity, water, telephone, sanitation, transportation, consulting, legal, accounting and auditing, etc for the year.

PAGE \# "'Page: '#''" Page: 48 This note is for the disclosure of individual cost items only. It should not be totalled and/or reconciled with total expenditure or COGS in the P&L.