Scenario: a Singapore parent company established in 2024 has only one year of financial statements so far. Its adviser says the IRC dossier requires “audited financial statements for the last two years” — the project faces a six-month delay over a single document. Is there really no alternative?
What the law says: financial statements are not the only route
Point (c), Clause 1, Article 32 of Decree 96/2026/ND-CP provides that documents proving the investor’s financial capacity comprise at least one of: the investor’s financial statements for the two most recent years; a parent company’s financial support commitment; a financial institution’s financial support commitment; a guarantee of the investor’s financial capacity; or other documents proving financial capacity. Many investors miss this: the law offers options — filing financial statements is not mandatory in every case. For a newly established parent without two years of statements, a parent support commitment (with the one available year’s statements) or a bank guarantee is a lawful route, squarely within the letter of the law.
Audit: not in the statute, but usually demanded in practice
Read closely: point (c) never uses the word “audit”. Yet dossier practice shows investment registration agencies commonly require statements audited by an independent auditor in the home country — only audited statements are considered reliable enough for a capacity assessment. The distinction matters: where home-country law does not require the parent to be audited (e.g., small companies exempt), the investor should file a written explanation citing that law together with the unaudited statements, while preparing a fallback (a support commitment or bank guarantee) so the agency has grounds to accept. The framework for preparing financial statements in Vietnam is Accounting Law 88/2015/QH13 — relevant by reference where the parent applies Vietnamese accounting standards or when the future Vietnamese subsidiary prepares its own statements.
Translation and the “freshness” of statements
Clause 2, Article 5 of Decree 96/2026/ND-CP: foreign-language documents must be accompanied by a Vietnamese translation — financial statements plus the audit report must be translated in full, with the translation notarized or the translator’s signature certified. On timing, “the two most recent years” means the two most recently ended fiscal years; note that countries whose fiscal year differs from the calendar year (e.g., ending in March) use their home-country fiscal year. One practical caution: some agencies require “fresh” statements, i.e., issued within about 90 days before filing — this is observed practice in some localities, not a verified uniform hard rule, so investors should ask the receiving agency in advance and prepare an update if needed.
Frequently asked questions
The parent was just established and lacks two years of statements?
Not a dead end. Point (c), Clause 1, Article 32 of Decree 96/2026 allows substitution with a parent support commitment, a financial institution commitment, a guarantee, or other proof of financial capacity — filed with whatever statements exist.
Are unaudited statements acceptable?
The statute does not mandate the word “audit”, but agencies commonly require audited statements in practice. If the parent is not subject to mandatory audit under home-country law, explain in writing with legal citations and prepare a fallback option.
The parent’s fiscal year ends in March, not December?
File the two most recently ended fiscal years under home-country rules, with an explanation of the accounting period for the agency to reconcile.
Will loss-making statements lead to IRC refusal?
No rule requires profitable statements. The agency assesses overall whether financial capacity matches the registered investment scale — a loss year with clear cash flow and support commitments can still be accepted, depending on the dossier.
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This legal analysis has been verified against current Vietnamese regulations and cross-border FDI transaction practices by the attorneys at FLAT LAW FIRM.
