Standards for chief accountant in Vietnam

Chief accountant is an indispensable position in a business. To become a company’s chief accountant, an individual, in addition to meeting professional and degree requirements, must also meet other criteria. In the article below, Viet An Law will answer customers’ questions about standards for chief accountant in Vietnam.

Legal basis

• Law on Accounting 2015, as amended and supplemented in 2019.
• Decree 174/2016/ND-CP details several articles of the Accounting Law, amended and supplemented by Decree 151/2018/ND-CP.
• Decree 41/2018/ND-CP regulates sanctions for administrative violations in the field of accounting and independent auditing, amended and supplemented by Decree 102/2021/ND-CP.
• Decree 80/2021/ND-CP guiding the Law on Assistance for Small and Medium Sized Enterprises.

What is the company’s chief accountant?

Under Article 54 of the Law on Accounting, the chief accountant is understood as the head of the unit’s accounting apparatus who is responsible for organizing the implementation of accounting work in the accounting unit. The chief accountant is under the leadership of the legal representative of the accounting unit; In case there is a superior accounting unit, it is also subject to the direction and inspection of the chief accountant of the superior accounting unit in terms of expertise and operations.

Is a company required to have a chief accountant?

According to Clause 1, Article 20 of Decree 174/2016/ND-CP, enterprises are required to have a chief accountant. If a company has not found a qualified person to be the chief accountant, the business can use accounting services or appoint a person in charge of accounting within 12 months. After this time, they must arrange a chief accountant.

However, also according to Clause 2 of this Article, micro-enterprises are identified in Article 5 of Decree 80/2021/ND-CP (maximum number of employees participating in social insurance is 10 people, total capital of the year is not more than 3 billion VND, total annual revenue not exceeding 10 billion VND for commercial service enterprises and not exceeding 10 billion VND for construction and agricultural enterprises) can arrange a person in charge of accounting but is not required to be a chief accountant.

Thus, all enterprises in the private sector must arrange a chief accountant position, except for micro-enterprises.

What are the standards for chief accountant in Vietnam?

General standard

Under Clause 1, Article 51 and Clause 1, Article 54 of the 2015 Accounting Law, it is stipulated that accountants must have:

• Have professional ethics, honesty, integrity, and a sense of compliance with the law;
• Have professional qualifications and experience in accounting;
• Have expertise and skills in accounting from intermediate level or higher;
• Have a chief accountant training certificate;
• Have actual working time in accounting for at least 02 years for people with accounting expertise and experience from university level or higher and actual working time in accounting is at least 03 years for people with accounting expertise and skills at intermediate and college levels.

In addition, to be appointed as chief accountant, that person must not be prohibited by law from holding the position of chief accountant at the enterprise. Under Clause 1, Clause 2, Article 52 of the Law on Accounting 2015 and Clause 2 and Clause 3, Article 19 of Decree No. 174/2016/ND-CP stipulates that people are not allowed to work as accountants as follows:

• Minors; People who have been declared by the Court to have limited or lost civil act capacity; people who are subject to measures of being sent to compulsory educational establishments or compulsory detoxification establishments.
• People who are banned from practicing accounting under a legally effective court judgment or decision; people being prosecuted for criminal liability; People who are serving a prison sentence or have been convicted of one of the crimes of violating the economic management order or position-related crimes related to finance or accounting but have not had their criminal records erased.
• Biological father, biological mother, adoptive father, adoptive mother, wife, husband, biological children, adopted children, siblings of the legal representative, of the head, of the director or general director and deputy of the head, deputy director or deputy general director in charge of finance – accounting, chief accountant in the same accounting unit, except private enterprises, limited liability companies owned by a single company. Individuals are owners, enterprises of other types do not have state capital and are micro-enterprises according to the provisions of law on assistance for small and medium-sized
• People who are managers, administrators, storekeepers, treasurers, and people assigned to regularly purchase assets in the same accounting unit, except in the same private enterprise or limited liability company limited by an individual and other types of enterprises that do not have state capital and are micro-enterprises according to the provisions of the law on assistance for small and medium-sized enterprises.

Regarding professional qualifications

Pursuant to Clause 2, Article 21 of Decree No. 174/2016/ND-CP stipulates that for the position of chief accountant of the following accounting units, one must have professional accounting expertise at a university level or higher, including:

• Agencies responsible for state budget revenues and expenditures at all levels;
• Ministries, ministerial-level agencies, Government agencies, National Assembly agencies, other central state agencies and accounting units under these agencies;
• Public service units belonging to ministries, ministerial-level agencies, Government agencies, other central agencies, and Provincial People’s Committees;
• Specialized agencies under the Provincial People’s Committee and equivalent; State management agencies under these agencies;
• Central agencies organized vertically located in the province;
• Political organizations, socio-political organizations, political-social-professional organizations, social organizations, and socio-professional organizations at central and provincial levels that use state budget ;
• The investment project management board has its accounting apparatus, using the state budget for group A projects and important national projects;
• Level 1 budget unit belongs to the district budget;
• The enterprise is established and operates under Vietnamese law;
• Cooperatives and cooperative unions with charter capital of 10 billion VND or more;
• Branches of foreign enterprises operating in Vietnam.

Pursuant to Clause 3, Article 21 of Decree No. 174/2016/ND-CP stipulates that for the position of chief accountant of the following accounting units, one must have professional accounting expertise from a professional intermediate level or higher. up, including:

• Specialized agencies under the district-level People’s Committee have an organized accounting apparatus (except for level 1 budget units under the district budget);
• Central agencies organized vertically are located at the district level, provincial agencies are located at the district level;
• Political organizations, socio-political organizations, political-social-professional organizations, social organizations, and socio-professional organizations at the district level that use the state budget;
• The investment project management board has its accounting apparatus and uses the state budget, except for the cases specified in Point g, Clause 2 of this Article;
• Budget accounting and finance units of communes, wards, and towns;
• Public service units other than those specified in Point c, Clause 2 of this Article;
• Enterprises established and operating under Vietnamese law without state capital, with charter capital of less than 10 billion VND;
• Cooperatives and cooperative unions with charter capital of less than 10 billion VND.

In addition to the general standards and conditions of a chief accountant, the enterprise’s chief accountant must meet the following conditions:

• Chief accountant of an enterprise established and operating under Vietnamese law.
• The chief accountant of an enterprise established and operating under Vietnamese law without state capital and with a charter capital of less than 10 billion VND must have accounting expertise at a professional intermediate level or higher.

Regarding actual working time as an accountant

For chief accountants, in charge of accounting of parent companies that are state-owned enterprises or enterprises with state capital accounting for more than 50% of charter capital, they must have at least 5 years of actual working time in accounting.

Thus, to become a chief accountant, it is necessary to meet all the standards and conditions of a chief accountant, in addition to meeting specific regulations, standards, and conditions of a chief accountant appropriate to each type of accounting unit.

Administrative sanctions in the appointment of chief accountant

Chief accountant or person in charge of accounting is an important title that must be held in every company. According to Article 17 of Decree No 41/2018/ND-CP, if the company commits violations during the appointment process, it will be fined, specifically from 5 – 10 million in the case of:

• Failure to re-appoint the chief accountant or in charge of accounting within the prescribed time limit;
• Do not hand over work when there is a change in chief accountant or charge of accounting;
• No notification when changing chief accountant or accounting manager.

Subject to fines of 10 – 20 million VND in the following cases:

• Failure to arrange or appoint a chief accountant;
• Arranging people to be the chief accountant or in charge of accounting does not meet the standards and conditions and does not follow the correct order and procedures.

Thus, accounting units and businesses that do not appoint chief accountant positions by the law will be subject to administrative sanctions of up to 20 million VND.

Above is information about the standards for chief accountant in Vietnam. Customers who need advice on procedures, documents, and licenses, please contact Viet An Law Firm for the most effective support.