Recently, the Ministry of Finance issued Circular No. 24/2022/TT-BTC dated 07 April 2022 (“Circular 24/2022”) amending Circular No. 48/2019/TT-BTC, guiding the establishment and handling of provisions for devaluation of stocks, loss of investments, receivable debts and warranties for products, goods, services and construction work.
Below are some of the salient points mentioned in Circular 24/2022:
► Amending and supplementing the provisions in Point a Clause 1 Article 5 on the subjects of provisions for loss of investments – Securities investments, according to which the subjects of provisions do not include Government bonds, government-guaranteed bonds, local government bonds.
► Amending and supplementing the provisions in Point b Clause 1 Article 5 on the formula for determining the level of provision for reduction in the price of securities investment hence, eliminating the provisions on determining the level of provision for reduction in securities investment prices for government bonds and local government bonds, government-guaranteed bonds.
► The provision balance of investments in Government bonds, government-guaranteed bonds and local government bonds that enterprises have provision balance (if any) until the effective date of Circular 24/2022 is reversed to reduce costs at the time of preparing the 2022 financial statements.
► Circular No. 24/2022/TT-BTC takes effect from 25 May 2022.
If you have any queries or require any further clarification, please do not hesitate to contact us.
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