IFRS Transition in Vietnam: A Governance-Wide Transformation

What this means for businesses: IFRS adoption is not a back-office bookkeeping change. It reshapes how a company is governed, how it makes decisions, and how it is perceived by international investors and lenders. 

1. Update on the status of IFRS and VFRS application in Vietnam 

The transition to IFRS and Vietnamese Financial Reporting Standards (VFRS) in Vietnam is entering a pivotal stage. 

• According to the latest roadmap, the Ministry of Finance plans to issue VFRS standards between 2025 and 2029, establishing a legal foundation for enterprises to adopt. 
• From 2030, companies will be able to voluntarily apply VFRS, gradually enhancing the quality of financial reporting in line with international practices. 
• For IFRS, businesses that are required or wish to adopt will begin implementation from January 1, 2027. 

This roadmap demonstrates Vietnam's commitment to deeper integration with global financial markets, while also improving the transparency and comparability of corporate financial information. 

2. Beyond accounting: A strategic opportunity 

While IFRS offers a strategic opportunity for Vietnamese enterprises, it is important to recognize that the current Vietnamese Accounting Standards (VAS) system presents significant limitations: 

• Outdated framework: With only 26 standards, VAS has not kept pace with the rapid development of the economy and increasingly complex business activities. It no longer meets the demands for modern governance and information transparency. 
• Limited coverage: VAS lacks many important standards found in international frameworks, resulting in financial statements that may not fully capture the substance of economic transactions. This can hinder effective decision-making and reduce comparability with global peers. 
• By moving beyond these limitations and adopting IFRS, enterprises unlock substantial benefits: 
• Enhanced transparency and governance: IFRS provides a comprehensive and up-to-date framework, enabling companies to present financial information that truly reflects their economic reality. This supports better governance and builds trust with stakeholders. 
• Improved decision-making and global comparability: IFRS adoption ensures financial statements are aligned with international practices, facilitating more informed decisions and easier benchmarking against global competitors. 
• Greater access to capital and strategic growth: With IFRS, Vietnamese companies can improve their credibility with investors and lenders, access new funding opportunities, and participate more confidently in cross-border transactions. 

IFRS isn't just a formatting exercise – it's a strategic transformation. Enterprises that embrace IFRS as a business opportunity, rather than a compliance task, gain more than transparency. They sharpen decision-making, improve access to capital, and build trust with investors. Overcoming VAS limitations by adopting IFRS opens the door to clarity, competitiveness, and sustainable growth. 

3. What determines the success of an IFRS conversion 

In most cases, IFRS conversions do not fail because technical accounting is too difficult to handle. Instead, challenges arise when projects lack clear structure, disciplined ownership, or timely decision-making. 

Experience from global implementations highlights five practices that consistently distinguish successful transitions from those that struggle: 

• Align policies with business priorities. Companies that anchor IFRS decisions in their strategic objectives – rather than relying on generic templates – reduce the risk of costly revisions later in the process. 
• Ensure cross-functional involvement. Finance alone cannot carry the conversion. Operations, IT, and tax functions must be actively engaged from the outset to ensure systems and processes support the new requirements. 
• Set enforceable milestones. A well-structured project plan with defined checkpoints – such as draft disclosures, system readiness, and shadow reporting – keeps progress on track and minimizes year-end surprises. 
• Address complex areas early. Standards such as IFRS 15 (Revenue), IFRS 16 (Leases), and IFRS 9 (Financial Instruments) are common sources of delay. Identifying and escalating these issues early prevents last-minute bottlenecks. 
• Maintain clear communication. Regular, transparent updates to boards, lenders, and internal stakeholders build confidence and reinforce that the conversion is a strategic initiative, not a compliance exercise. 

4. The IFRS journey: From diagnosis to daily discipline 

Every transition begins with the same question: where do we stand today? That's the essence of Gap Analysis. It's not just lining up VAS against IFRS; it's tracing processes end-to-end to surface what's missing. Previously unrecorded areas often emerge – employee benefit obligations under IAS 19, embedded lease commitments, or impairment triggers that never made it into local reporting. The result is a clearer, more honest map of the road ahead. 

With that clarity, the work shifts to Implementation, where decisions become operating reality. Policy papers and disclosure templates set the frame, but the test is execution: capturing lease terms correctly, coding contracts for revenue recognition, and ensuring impairment indicators flow into the close. This is where IT upgrades and process redesigns stop being optional. Teams that invest early in system enablement avoid the spreadsheet sprawl that sinks many first-year IFRS closes. The backbone of IFRS is built on processes that generate reliable data daily. 

Finally comes Training & Monitoring, which ensures IFRS doesn't remain a one-off project but becomes part of the company's rhythm. Teams need practice under real closing pressure. Pilot closes, focused workshops, and structured reviews drive consistency and quality. Organizations that weave IFRS into monthly and quarterly cycles find that compliance matures into stronger financial discipline – and a more confident external story. 

Scenario – three-stage journey: 

5. Why this transition matters 

The shift to IFRS should not be viewed as a compliance exercise. It represents a strategic opportunity to: 

• Strengthen systems and controls, ensuring higher-quality data is captured at the source. 
• Meet international expectations, reducing obstacles in discussions with lenders, investors, and global partners. 
• Enhance resilience, positioning the business for sustainable growth as it expands across borders. 

In Vietnam, companies that adopt IFRS early are already turning the transition into a source of strength. By tightening lease data management, refining store-level impairment testing, and aligning tax planning with new reporting bases, they are moving ahead of their peers. More importantly, early adopters are positioning themselves for the future: ready to attract cross-border investment, meet evolving regulatory requirements, and compete with greater confidence on the global stage. 

How can we help? 

Our Outsourcing team can help you assess your IFRS readiness, identify key gaps across accounting, processes and systems, and develop a practical transition roadmap tailored to your business.