Adoption of ifrsin Vietnam: Challenges for the accounting profession

With the anticipated increase in financial reporting transparency that is likely to follow IFRS adoption, interviewees were asked whether auditing firms should organize the train[r]

Adoption of ifrsin Vietnam: Challenges for the accounting profession

Researchers: Lê Thị Thuỳ Dung

Hà Thị Thanh HuyềnNguyễn Diệu AnChâu Thị Hải YếnClass: AC2015B&AC2015CProject instructor: MSc Nguyễn Trà My

I Introduction

1 ResearchNecessity

The adoption of IFRS means there will be changes in the work requirement ofaccountants There will be a need for accountants to update their knowledge,professional skills, and experience With the anticipated increase in financial reportingtransparency that is likely to follow the IFRS adoption, accountants are expected toshow higher sense of responsibility and accountability over financial information inorder to align with the international standards, requirements, and expectations.Researching the changes in the work requirement of accountants that are relevant tothe IFRS adoption is essential for facilitating a smooth transition to IFRS and, moreimportantly, for upgrading the expectations of young accounting graduates Studentsthat finish accounting courses and wish to build their careers as accountants will befaced with new expectations once Vietnam successfully adopts IFRS It is importantthat these students learn about what will be expected of them once they graduate.Therefore, this topic bears a paramount importance and is highly practical forVietnamese students studying towards a degree in Accounting

2 ResearchPurpose

This paper aims at studying the perceived impact of IFRS adoption for accountingprofession The idea behind this research paper originated from the perception thatVietnam intends to apply the International Financial Reporting Standards (IFRS) inthe coming years , this will help Vietnamese businesses integrate into the globaleconomy In the context of the economy that is in the process of deepening integrationwith the region and the world, to improve the business environment, sustainabledevelopment, support the stock markets, protect the investor s rights and attract‟foreign direct investment, the Government has requested to improve the transparency

of financial information (ifrsvietnam.vn, 2017) On the other hand, in order to accesscapital flows in the international market, listing in foreign markets, the requirement tomake IFRS financial reports is becoming increasingly urgent and indispensable forcorporations, public companies The general theme behind this research is figuring outthe difficulties and challenges when applying the International Financial

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Reporting Standards (IFRS) in Vietnam to stakeholders such as authorities,training institutions, enterprises as well as accountants, auditors, accountingstudents and the appropriate solutions for them, especially for those who arestudying undergraduate studies at universities and colleges Because whenIFRS is applied to Vietnam, the next generation of accountants should bewell prepared for the path of integration and development of the globaleconomy These will be further demonstrated throughout the Findings andDiscussion section of this paper.

3 Research Objective and Scope:

The objective of this research is to focus on Big4 and non-Big4accounting firms in Vietnam (mainly ones in Hanoi) Researchers requested

to meet the representative from these firms and enquire about how the firmsplan to prepare their workforce for the IFRS transition Besides, researchersalso aimed at finding out what these firms expect from future Accountinggraduates in general and future successful recruits specifically Thepreliminary method for achieving these objectives is to interview recruitmentrepresentatives and managers from accounting firms (Big4 and non-Big4) inHanoi that have branches across other cities in Vietnam

4 ResearchQuestion:

Vietnam plans to use IFRS in financial reporting in the near future (IFRS Vietnam.vn).The central question of this research is the challenges that are faced byaccounting professional when IFRS is adopted in Vietnam In order to detect theimpact of adopting IFRS into Vietnam for the accounting professionals, thefollowing research questions were used as a ground basis for designing theinterview questions and as an underlying research objective throughouttheresearch

1.What are the benefits and challenges posed by the accounting

professionals in adopting IFRS inVietnam?

2 What is needed to prepare before adopting IFRS intoVietnam?

3.How will the adoption of IFRS affect the expectations of

employers forgraduates? The specific interview questions outline and how

they were analyzed will be included in the Methodologysection.

5 Facilities and difficulty of the researchingprocess

In the process of scientific research, selecting a suitable topic is the firstdifficulty that our group encountered as it plays a key role in determining thesuccess of a research project

Choosing a good, feasible, and achievable subject in student s capacity‟was a challenging task Our team also spent a great deal of time in selectingand specifying the research topic for a most feasible yet effective study Thenext difficulty is the search for materials as well as self-research skills.Online resources are becoming more diverse and plentiful, but difficult toverify in terms of precision, which is essential for scientific research Inaddition, this is a fairly new topic so there was a scarcity of the amount ofbooks available that are related to this specific topic Finding important andpractical documents required dedication and persistence, sometimes quiteexpensive for students In particular, finding the appropriate interviewees forthe scientific research was one of the challenges to reach the feasibilityin.Studied results The number of people with in-depth knowledge of theselected research topic in Vietnam is limited, so interviewees available foreffective and relevant data collection were also limited in quantity Last butnot least, assigning the works among team members clearly, ensuring timelycompletion of the work was a learning curve that was new but essential to theresearch team

6 ResearchStructure:

Having realized that IFRS will be likely adopted in financial reporting

in Vietnam, this paper attempts to delve into the understanding about theimpact of IFRS for accounting professionals in the future and the perspective

of experts in accounting field about this problem The remaining part of thepaper is broadly divided into four parts (sections 2 to 5) Section 2 provides abrief recap of the meaning of IFRS and the adoption in a myriad of countriesaround the world This part also tackles the already known literature about

the experiences for Vietnam before IFRS implementation Section 3describes the methodological framework applied for the purpose ofanswering those research questions The semi- structured interview methodwas used in this research through two forms, which are the directcommunications and indirect interviews via e-mail and survey This is alsowhere the interview questions were designed and the method of its analysisare included Section 4, which constitutes the major part of this paper,presents the Findings and Discussions that results from the semi-structuredinterviews to clarify the connoisseur opinions about the desired effects andthe difficulties of IFRS adoption into Vietnam to accounting professionals aswell as the needs to prepare for the students after graduation Finally, section

5 concludes the research and suggests further research

II. Literature review

1 Introduction

This chapter aims to provide a review of existing literature on mattersrelated to IFRS Adoption and its impact on Vietnamese accountingprofession The chapter begins with a brief capture of IFRS adoptionsituation around the world It then proceeds to discuss more closely thereality of IFRS adoption, with focus on successful implementation as well

as the transition Finally, the chapter concludes by evaluating the benefitsand drawbacks of IFRS adoption on the accounting profession in Vietnam.Convergence of accounting standards is not a new topic to the accountingprofession The IASC efforts to issue standards to serve as principles to befollowed internationally were made as far back as 1973 (Sunder, 2002) Adefinition is mentioned that IFRS is a set of international accountingstandards stating how particular types of transactions and other eventsshould be reported in financial statements IFRS is issued by theInternational Accounting Standards Board, and it specifies exactly howaccountants must maintain and report their accounts IFRS were established

in order to have a common accounting language, so business and accounts

can be understood from company to company and from country to country.(Staff, 2017).

In recent years, there has been a trend towards a common globalizedaccounting standard with IFRS used in many parts of the world, including theEuropean Union, Hong Kong, Australia, Russia and Singapore, among othernations (Dumont,2017) The accounting profession and reporting processhowever is shaped by other factors that go beyond the physical tangiblestatements, factors such as the economic, political, cultural andenvironmental situation of a reporting country (Uwuigbe et al, 2011; Demaki,2013) It is not difficult to observe the variations in financial reportingpractices and accounting standards from country to country

that result from differences in the nature of the country s legal system, the‟prevalence of finance providers, the influence of taxation, and the strength ofthe accountancy profession (Narayan et al 2000) Viet Nam is expected toadopt International Financial Reporting Standards (IFRS) instead of thecurrent Vietnamese accounting standards (VAS) by 2025 in its efforts to

(English.vietnamnet.vn,2017)

“TheIFRSsareveryimportanttothemarketeconomy.Thisisbecauseinvestors co‟nfidence cannot easily be retained with information that is not comparableand this makes them uncertain about information given to them.(www2.deloitte.com) The advantages of achieving convergence with IFRSare numerous Firstly, it benefits the economy by increasing the growth of itsinternational business By encouraging the international investors to invest,

it leads to more foreign capital flows to the country Financial statementsprepared using a common set of accounting standards help investors betterunderstand investment opportunities as opposed to financial statementsprepared using a different set of national accounting standards The industry

is able to raise capital from foreign markets at lower cost if it can createconfidence in the minds of foreign investors that their financial statementscomply with globally accepted accounting standards Finally, it offers

accounting professionals more opportunities in any part of the world if sameaccounting practices prevail throughout the world (Morgan McKinleyIreland, 2017) The International Financial Reporting Standard has manyadvantages but have some disadvantages also Some small entities havegood accounting system but forced to incur the cost to change the newaccounting system Local rules and regulation and tax laws of each country

is different In some cases, entities may require to prepare different financialstatements for local laws and tax departments (Shete, 2017)

From the disadvantages and advantages that Viet Nam receives with theapplication of IFRS, the accountants, auditors as well as those preparing toenter the accounting profession should prepare some factors such as skills,knowledge, experiences

2 Reality of IFRS adoption in somecountries:

Successfulimplementation:

Today, over 12,000 companies in over 100 countries have either mandatorily

or voluntarily adopted International Financial Reporting Standards (IFRS)including in most capital markets around the world (Company Watch 2015).Some countries of these are not only in Europe, but also in Asia such as HongKong, Singapore or Malaysia which adopted successfully this standard veryearly There are a myriad of skills and knowledge trained for accountants andauditors which help them have IFRS mindsets and use efficiently Besides,many desire

Effects are brought for both of investors and accounting professionals byIFRS application First of all, European Union after 10 years application saidthat IFRS has succeeded in creating a common accounting language for thecapital market The investors and businesses help support IFRS in improvingthe transparency and comparability of financial statements (IFRSVN, 2017).Secondly, Irvine and Lucas (2006) state that substantial benefits have beenproposed by the adoption of IFRS, including a decreased cost of capital,greater mobility of capital, greater efficiency in the allocation of resources,and a decrease in the opportunities for earnings management expression

According to Yu (2009), there is evidence of increased foreign investment inaccordance with the application of IFRS As the result, this can makecompetiveness for enterprises in the capital market.

Although accounting professionals across the world have listed variousbenefits of adopting IFRS, this is also a difficult task and has posed severalchallenges Firstly, adoption of IFRS means that the entire set of financialstatements will be required to undergo a drastic change It would be achallenge to bring about awareness of IFRS and its impact among the users

of financial statements (Dr.A.Vinayagamoorthy Ph.D, 2014) However,according to Paul Asiemo (2017), people have a tendency to resist change.Uthman Saheed (2016) studied that this needs the high cost in the first timeimplementation of IFRS Furthermore, the IFRS is known as “principlebased” standards that do not prescribe detailed rules, leaving the task ofactual accounting processing to the discretion of individual companies andauditors (Tokyo Foundation, 2011) Transactions of similar nature may,therefore, be processed quite differently according to how they areinterpreted by each company (Tokyo Foundation,2011) This can easily giverise to window dressing (Tokyo Foundation, 2011) Besides, the aim of aglobal comparability in financial reports might not be realized if standards inthe IFRS were not applied in a uniform and consistent manner (Joshi et al.,2008) There was also the problem of translation of the standards in countrieswhere English was not the dominant language (Perera and Baydoun, 2007;Sunder, 2007) Language problems could result in diversity in interpretationand application of the IFRS (Perea and Baydoun, 2007; Sunder, 2007).Translators with a good knowledge of English and technical accountingconcepts were needed to provide the same quality of standards, and peoplewith this expertise were rare (Tan et al.,2007)

In general, each country will choose a suitable route for them which depend

on the characteristics of each country's economy Although IFRS helpsaccounting professionals work easier, they are also confronted withnumerous devastating effects The countries who adopted IFRS have added

the references or have changed in the financial reporting language to adaptwith a new standard.

Countries currently applying and looking to applyIFRS:

Some countries such as Indonesia, Thailand, Japan, India are now inprocess of applying IFRS in accounting profession Although implementationIFRS is a very significant step forward, they face several challenges andobstacles The first challenge is providing adequate training to preparepractitioners with professional skills (Fazeena Fazneen Hussain,PriyashniVandana

Chand, and Prena Rani, The University of the South Pacific, 2012) InIndia, it is a key challenge to ensure companies, auditors, regulators andinvestment community is appropriately to apply and interpret IFRS (Dr A.Vinayagamoorthy Ph.D, 2014) The second challenge is different officiallanguages other than English, it creates difficulties in understanding andapplying (Tokar, 2005) Furthermore, Tokar (2005) added that timely IFRStranslation into national language is another obstacle to gain a smoothtransition The third challenge is distinguished in the accounting culture ofcountries as Japan, Thailand may result in problems in interpretation andapplying IFRS (Noryuki, Andreas Hallmann, Simone Domenico, Scagnelli,

2015 and Sasisri Phruettiyanan, 2010) To deal with those challenges,countries recommended appropriate solutions in the case of each country Forinstance, in Japan, the JICPA established the Japan Federation for AccountingEducation and Learning so that improve judgment skills in the accountingprofessions (Noryuki, Andreas Hallmann, Simone Domenico, Scagnelli,2015) Besides, countries could focus on translation into national languageslike Thailand, it expects only a one-year gap between the IFRS effective dateand the adoption, due to the need to translate IFRS into the Thai language(Amelia Limijaya, 2017) In addition, Amelia Limijaya (2017) point outrecommendations of ANC (2016) and Baskerville & Evans (2011) that

“Some suggestions as to how to handle this translation issue are given, such

as standard-setters need to consider other related areas when translating the

standards, for example linguistic, anthropology and psychology aspects, andthey must be aware of this issue at the earliest stage possible so they can bear

in mind the potential language and translation difficulties that may beencountered by non-English speaking countries” For countries in term ofprocessing of implementation IFRS, they are applying IFRS in positive ways

As in the case of Indonesia, it needs to fasten the process of IFRSimplementation, in order to stay on track for the ASEAN EconomicCommunity Blueprint 2025 (Amilia Limijaya, 2017)

The accounting profession in Vietnam andIFRS

Currently, Vietnam is in term of processing of preparing forimplementation IFRS in accounting profession From countries haveadopted IFRS- implementation in accounting profession in Asia, Vietnamcould consider their experiences, especially Thailand, Indonesia, Malaysia-the countries have similar economy with Vietnam The experiences ofThailand point out is that the first and key step to prepare adopt IFRS isenhancing necessary skills for practitioners such as professional knowledge,English skill, having ability to adapt in new accounting culture in whichprofessional judgment must be emphasis (MA Nguyen Thi Thu Van; MA.Nguyen Thi Phuoc; MA Hoang Thuy Dieu Linh, 2017) In short, with theglobalization and presence of ASEAN Economic Community Blueprint

2025, Vietnam needs to have strategic IFRS implementation action plans toachieve an integrated as well as cohesive economy of the world

Along with the extensive economic integration, the demand for high qualityaccounting and auditing in Vietnam is expected to increase rapidly in thecoming time (MS Vu Mai Phuong,2017) New challenges and opportunitiesare emerging more than ever when trade liberalization agreements with labormobility have become reality Currently there are about 200 universities,colleges and hundreds of accounting and auditing vocational courses by.Enterprises organized in any form According to a survey in Hanoi JobExchange in the first 6 months of 2016, Accounting - Finance ranked amongthe top job seekers (laodong.vn,2017) In fact, the number of trained

personnel in the industry is very large, but there are still gaps between supplyand demand (MS Vu Mai Phuong,2017) This is a sector with a high level ofcompetition As a result, the accounting profession is in a state of red alertand will remain the abundance for many years (Bao Duy,2017) According toBao Duy,2017, the process of finding a good job, competitive pressures inrecruiting with the fighting proportion of 1/65 is a big challenge for them(each candidate must pass 65 other people to get a job).Inaddition,lacking ofthe knowledge and experience of most accountants also are barriers in theirjob searching In particular ,Viet Nam tend to convert Vietnamese financialstatement into international financial reporting in the next few years(ifrsvietnam.vn,2017) In fact, Vietnam has been taking positive steps, ready

to move forward to widely apply IFRS (ifrsvietnam.vn,2017) This requireschanging in accounting profession to be able to keep up with new trends andmeet the job requirements Nowadays, few number of accountants,auditorshave good prepares before getting a good job.Most of them still do not have

a clear job orientation as well as preparing the necessary elements to meetthe employers, s requirements Along with the development of marketeconomy and increasingly extensive integration with regional andinternational, especially towards international financial reporting standards.the accountants and auditors should capture by cultivating professionalqualifications, technical skills, enhancing professional skepticism,professionalism in providing services, as well as integrity to become aprofessional human resources, ready to meet the job requirements in thetrend of global economic integration

III. MethodologicalFramework

1 ResearchMethods

More and more businesses and organizations in the world apply theInternational Financial Reporting Standards (IFRS) The adoption of IFRSincreases comparability and transparency in financial reporting (KPMG,2018) Financial statements prepared in accordance with IFRS are widelyaccepted in many countries around the world (KPMG, 2018) The subject of

this study will focus on the influences of the IFRS on the accountingprofession in Vietnam This section of the paper discusses the researchmethods used and justifies the suitability of the methods to the researchobjective.

Semi-structured interviews were used in this research through two formswhich are direct and indirect The nature of face-to-face interview is theprocess of contact between two or more individuals to try to gatherinformation, responses and views of the interviewees on a predeterminedtopic The interview results can be considered non-biased and objective asthey reflect the interviewees objective opinions ‟ It is important to note thatthese opinions might not be entirely accurate or true, but rather they merelyreflect the real perception of individuals with relevant experience In total,four interviews were conducted: three directly and one indirectly throughemail The interviewees are practitioners working in the fields of audit andaccounting in Vietnam in both Big-4 and non-Big-4 firms, and academicsteaching accounting and audit at university level All interviews wereconducted within 2 months consistently across all 4 interviewees Interviewresults were collected, transcribed,andnalyzed once completed Opinions ofall interviewees were studied in-depth and conclusions were drawn In thedirect interviews, researchers and interviews spoke face-to-face Theconversations were therefore conducted very carefully, the content wascarefully prepared to maintain natural flow and professionalism in questionsand answers Every interview was recorded with the permission ofinterviewees, and later transcribed to include as part of this research

It is believed that this approach, combined with a number of additionalqualitative sources of information, will provide valuable insight tounderstand the qualitative nature of research topics In addition, there aresome differences when used in both direct and indirect forms

Direct interviews were conducted immediately and after contact withindividuals about time and place, time was quite flexible and quick.Indirect interviews through Email will take a long time to wait, usually

taking two to three weeks to get back the results There are differences inthe two forms, but the accuracy and the results are not different because theinformation received by the individual interviewed and kept strictlyconfidential.

All interviewees were of Vietnamese origin, so the interviews wereconducted in Vietnamese, then they were translated into English andanalyzed in English All respondents who signed the participant consentforms are included in Appendix 1

2 Interviews Design andAnalysis:

In an attempt to make each interviewee feel as comfortable as possible, theinterviewees were sent a short questionnaire of the topic and the mainobjective of the research prior to the real

interview The definition of “IFRS” and the concept of IFRS adoption andVietnamese accounting profession adopted in this paper was also introduced

to them in order to establish a common understanding of the key concepts.The questions were designed with considerable flexibility allowed and theywere largely dependent on what the participants had said The questionnaireasked participants with the purpose of exploring the points of view of theinterviewees to a large extent However, a broad structure of questionnairewas still in place The following main 6 topics were discussed, however, notnecessarily in the given order:

1.In the global integration trend, IFRS financial reporting is increasinglyreceivingsupport from countries and territories around the world Manycountries have successfully applied IFRS in financial reporting,interviewees were asked about the roadmap to apply IFRS in Vietnam,should apply in part or in whole? They all expressed their opinions on thismatter, which were mostlysimilar

2.The second question elicited information about the impact ofimplementing IFRS onthe Vietnamese accounting profession,interviewees were asked about what they thought the positive andnegative impact of IFRS adoption would have on the Vietnamese

accounting system in the short term and longterm.

3.Interviewee's view on the preparation of those who have been and will be

in theaccounting profession was explored There will be a need for them toupdate their knowledge, professional skills, and experiences Intervieweeswere asked to respond abouthowindividuals in the accounting professionshould be prepared in detail in order to align with the international standards,requirements, and expectations

4.Employer's expectation was then discussed Participants were

asked whether this application influenced employer's expectations of

young accounting graduatesduring recruitmentprocess

5.With the anticipated increase in financial reporting transparency that islikely to follow IFRS adoption, interviewees were asked whether auditingfirms should organize the training courses for permanent employees inaccordance with the VAS, opening the training course at practice accountingcenters as well as complementary lectures on teaching at universities andcolleges to help them easily adapt to thischange

6.Finally, with students who are studying accounting at universities andcolleges inparticular and wish to build their careers as accountants will befaced with challenging expectations of employers once Vietnam successfullyadopts IFRS Interviewees were asked about their advice for Vietnamesefuture accounting generation in order to be readily adapting and integratingwith the IFRSadoption

3 Methodologylimitations:

Due to the limitations in research scope, available time and resources, theonly one method was used for the purpose of this research was interviews,both direct and indirect, conducted among accountants who have high level

of credibility and experience in accounting field and academics with relevantexpertise For the topic which requires in-depth and detailed assessment,using only one method might not fully ascertain the depth of the problem, aswell as might not cover all the aspects of it, and the analysts may face therisk of missing crucial parts of information However, after careful

consideration, interview method was chosen for this research paper because

it is believed that the flexibility of interview method would attain multidimension of data source when compared to other methods Otherwise, usingentirely four independent perspectives (from 6 questions) would ensure thedepth and objectivity of analyses and interpretation

Four limitations came to the researchers attention throughout the process of‟conducting interviews Firstly, the sample population that participated in theinterviews was small, only four people, of whom, all of them are professionalaccountants, which implies lack of diversification of representativeness It isworth noting that students and educators would also be affected by the switchfrom VAS to IFRS Secondly, the interviewed sample consists of mostly inBig-4 companies and experts in accountant field, which can be considered asignificant limitation because Vietnam economy mainly consists of mediumand small sized companies However, since this research aims at investigatingperceptions and opinions of experienced individuals, it is deemed appropriate

to interview those from large companies like the Big-4 because of theirimmense amount of practical experience and exposure to internationalpractices Thirdly, the scale of this interview method orientates aroundVietnamese individuals only and does not consider foreign individuals, whocould add significant contribution to this research As can be known, FDI flowinto Vietnam in 2017 was 36 billion dollars, highest from 2009 (Thanh Tam,2017), which emphasizes themagnitude of global corporations, hence, theforeign factors deserve to have a place in the sample but was excluded fromthis research due to limited time and resources Lastly, the interviews wereconducted entirely in Vietnamese, which potentially imposes risks ofmistranslation, misinterpretation and incomplete conveyance of message

The research team has ensured to provide the highest possible quality ofanalysesand

translation,aswellasthethemeidentificationintheinterviewees answers.‟ Itisworthnoting that the interview was carried out during the time when IFRS andits pros and consto

Vietnam were being debated, which might slightly affect theinterviewees opinions However, during the time of interviews, it was‟noted all interviewees had positive faith in IFRS and its prospects inVietnam, which shed light on the potential reception of IFRS adoption innear future.

4 Interviewee’s Profiles

The researched sample consists of four interviewees who are

experts in professional accounting and audit

Interviewee 1 is the Deputy manager of Assurance service ofPricewaterhouse Cooper (PwC) in Vietnam which is one of the biggest fourauditing companies in the world in terms of scale, profit as well as process ofdevelopment PwC was established in 1994 in Hanoi and Ho Chi Minh Citywith high-quality labor workforce Interviewee 1 worked with diverse types

of Vietnamese companies, foreign companies, joint ventures, among others,

so he is well- informed about environmental business and interested indevelopment accounting profession in Vietnam The research team washonored to have an opportunity to hold a conversation with him at PwC, sothat he could openly express his perspective, assessment about adoptingIFRS to professional accounting in Vietnam and around the world Thus, theinterview brought important knowledge and experience insights for thisresearch

Interviewee 2, 3 are senior auditor and audit manager from Ernst & Young(EY) which had operated from 1992 in Vietnam Similar to PwC, EY iswell-known for auditing profession, consultancy services, and is one of theBig 4 as well Having good command in providing auditing services for bigcompanies in Vietnam such as ANZ bank, Daichi insurance company, HoangAnh Gia Lai corporation, Vietcombank, the interviewees perception of‟accounting and auditing was in-depth and comprehensive Besides, theyreally understand necessary demands for development of the accountingprofession and decreasing the gap between Vietnamese accounting standardsand international accounting standards Therefore, an important discussion

was carried out with each of them separately about adoption IFRS issues aswell as how students should prepare to integrate the new accountingstandards - that is, IFRS.

Interviewee 4 is the Director of Indovina bank which is a joint venture bankbetween Vietnam and Taiwan Being at her position, she has reliable andcomprehensive perceptions about the accounting profession in Vietnamesebank system as well as takes interest in solutions to deal with difficulties inadoption IFRS in Vietnam Also, she profoundly expressed her interest in theaccounting profession in other countries in Asia like Taiwan, so that our teamcould see the real picture of challenges in adopting IFRS in developingcountries as a good illustrationfor Vietnam Furthermore, around the time ofthe interviews, she participated in lecturing at various universities in Vietnam(International school- VNU) as well as in foreign countries According to herexperiences which she shared during the direct interview, she understandsthat students should early prepare the important skills to meet requirements

of employers when IFRS is largely adopted in Vietnam

IV. Findings andDiscussion

The outcome of analysis of the collected data helped researchers organizethe findings into main themes The following 3 broad themes wereidentified: (1) Benefits of applying IFRS,

(2)Perceptions about challenges of IFRS implementation in Vietnamfor the accounting profession, and (3) Preparations needed beforeadopting IFRS into Vietnam Each ofthe

themeswillhereafterbediscussedthoroughlyincorporatingtheinterviewees‟viewpoints, externally acquired information, and researchers‟ownanalyses

1 Benefits of applying IFRS

International Financial Reporting Standards (IFRS) was officially applied

in many countries from 1/1/2015, particularly starting with the 28 countries

of the European Union and now more than 130 countries and territoriesworldwide have adopted IFRS In Vietnam, as the economy enters a period of

strong integration on both the regional and international sales, IFRS becomesmore popular and attracts more attention from policy-makers, nationalexperts as well as the business community Despite disagreement andcontroversy, there is no denying the great benefits of adopting IFRS.

Firstly, IFRS contributes a great deal to the global economy It can be saidthat IFRS creates transparency, enhances comparability of information,enhances accountability by reducing asymmetry of information between thebooks and the reality, and between the company and the outside world.According to the IASB's survey, IFRS has helped to improve capital marketsperformance and boost cross-border investments Thus, the application ofIFRS not only helps analysts compare investment results within each countrybut also worldwide Not only does this help these markets improve theirability to attract foreign direct investment, but also it helps their economiesand businesses significantly reduce the cost of issuing stocks and bonds,enhance, capital mobilization, due to higher credit rating

Secondly, thanks to being internationally-recognized, IFRS-compliantbusinesses should be more efficient, promote business fair competition, andreduce costs IFRS has improved solvency and reduced capital costs in somecountries around the world (Daske, 2008) IFRS has reduced capital costsbut only in enterprises in countries with a strict legal regime (Li, 2010) Thiswill increase fairness and increase investor confidence in the market,provided that this standard is strictly enforced by high compliance Financialreports also provide comprehensive, accurate and timely information andtherefore enterprises can compare with their competitors so that they knowthe strengths and weaknesses of their competitors

Businesses will enhance the advantage of their business and overcomeweaknesses to improve the enterprise, thereby increasing the competitiveness

of enterprises Investment firms may also assess the situation of the business

to invest, establish production facilities, projects or even invest in new areasabroad

Thirdly, the application of IFRS helps to improve the quality of financialstatements Those who are interested in easily understanding the financialstatements, business situation of the business, and then making the rightdecisions, need to be able to understand IFRS Although there are someindicators that IFRS in Vietnam will be difficult to apply in practice, such asdeficiencies in fair value recognition, there is no denying the benefits ofIFRS It eliminates transnational trade barriers through more reliable,transparent and comparable financial reporting.

In addition to benefiting domestic and foreign businesses, large and smalldevelopers and more developed economy provide practical benefits toaccountants and students in the field

2 Interviewers’ and researchers’ perceptions about challenges

of IFRS implementation in Vietnam for theaccountingprofession

Nowadays, the adoption of IFRS in financial statement is more populararound the world and Vietnam should not be an outlier to this generaltendency However, Vietnam would possess various difficulties in the process

of implementing IFRS, especially for the accounting profession who woulddirectly work with IFRS in their daily jobs From interviewees opinion, it‟was found that the challenges for accountants, auditors as well as for students

in accounting filed were mainly related to quality of human resource,understanding standards in English, the cost of training, and the complexities

of IFRS by nature The following subsections will discuss each of thesechallenges in turn

Quality of humanresource

According to interviewee 1, the first difficulty is scarcity of high qualityhuman resource for accounting profession in Vietnam who have knowledgeabout IFRS and good English skill Compared with the current internationaleconomic integration, Vietnam's accounting workforce faces manylimitations regarding capacity Accounting training in Vietnam is still heavilyfocused on theoretical aspects, the human resource of accountants is formally