Ltd Company Limited 2 CEO Chief Executive Officer 3 CIT Corporate Income Tax 4 COGS Cost of goods sold 5 E-invoice An electronic invoice 6 IT Information technology 7 PIT Personal Income
BANKING ACADEMY FACULTY OF ACCOUNTING AND AUDITING - GRADUATION THESIS TOPIC: ENHANCE THE ACCOUNTING FOR REVENUE, EXPENSES AND EVALUATION OF BUSINESS RESULTS AT TTP HOLDINGS JOINT STOCK COMPANY Student: Nguyen Tram Anh Class: K22CLCE Student code: 22A4020107 Lecturer: PhD Nguyen Tien Dat Hanoi, 2023 BANKING ACADEMY FACULTY OF ACCOUNTING AND AUDITING GRADUATION THESIS TOPIC “ENHANCE THE ACCOUNTING FOR REVENUE, EXPENSES AND EVALUATION OF BUSINESS RESULTS AT TTP HOLDINGS JOINT STOCK COMPANY” Student: Nguyen Tram Anh Class: K22CLCE Student code: 22A4020107 Lecturer: PhD Nguyen Tien Dat Hanoi, 2023 Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat DECLARATION I hereby declare that this thesis is my own work and effort and that has not been submitted anywhere for any award Where other sources of information have been used, they have been acknowledged The data and results described in the thesis are derived from the actual situation of the practice company Hanoi, 17 May, 2023 Nguyen Tram Anh Nguyen Tram Anh i K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat ACKNOWLEDGEMENTS I would like to express my deeply indebted and grateful gratitude to the Board of School directors of Banking Academy and all the teachers in the Faculty of Accounting and Auditing for helping me gain knowledge about my major as well as my practical knowledge In particular, I would like to express my deepest gratitude to PhD Nguyen Tien Dat for always accompanying me and supporting me to the fullest extent so that I could complete this research project completely I would also like to express my sincere thanks to the Board of Directors of TTP Holdings Joint Stock Company for facilitating me to practice at the company, I would like to sincerely thank the members in the accounting department for their help wholeheartedly guide, help and create the most favorable conditions for me to complete my graduation thesis well During my internship as well as in the process of completing my thesis, due to time constraints as well as knowledge, it is hard to avoid mistakes Therefore, I sincerely hope to receive the omission of the lecturers and also look forward to receiving the contributions to make the thesis better Finally, I would like to extend my heartfelt thanks to my entire family and friends They are always a great source of unceasing encouragement and support during my whole journey Sincere thanks! Nguyen Tram Anh ii K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat TABLES OF CONTENT INTRODUCTION .1 (1) Abstract (2) Study overview (3) Objectives (4) Subjects of the study (5) Scope of the study: (6) Research methods (7)The structure of the thesis .3 CHAPTER I: THEORICAL FRAMEWORK FOR ACCOUNTING REVENUE, EXPENSES AND EVALUATION OF BUSINESS RESULTS IN THE ENTERPRISE .4 1.1 Some basic concepts of revenue, expenses and Evaluation of business results .4 1.1.1 Basic concepts 1.1.1.1 The concept of revenue and other income 1.1.1.2 The concept of expense 1.1.1.3 The concept of Evaluation of business results 1.1.2 Roles and responsibilities of accounting for revenue, expenses and Evaluation of business results in the enterprise 1.1.2.1 Roles .7 1.1.2.2 Responsibilities 1.2 Accounting for revenue, expenses and Evaluation of business results in the enterprise 1.2.1 Accounting for sales revenue .8 1.2.2 Accounting for Sale deductions 10 1.2.3 Accounting for Cost of goods sold 11 Nguyen Tram Anh iii K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat 1.2.4 Accounting for Selling and administrative expenses 14 1.2.4.1 Accounting for Selling Expenses 14 1.2.4.2 Accounting for Administrative Expense .15 1.2.5 Accounting for Financial income and financial expenses 17 1.2.5.1 Accounting for Financial Income .17 1.2.5.2 Accounting for Financial Expense 19 1.2.6 Accounting for Other incomes and other expenses 21 1.2.6.1 Accounting for Other incomes 21 1.2.6.1 Accounting for Other expenses 23 1.2.7 Accounting for Corporate income tax .25 1.2.8 Accounting for Evaluation of business results 26 Conclusion of chapter 28 CHAPTER 2: STATUS OF ACCOUNTING FOR REVENUE, EXPENSE AND EVALUATION OF BUSINESS RESULTS AT TTP HOLDINGS JOINT STOCK COMPANY .29 2.1 Management organization and characteristics of revenue and expenses of TTP Holdings Joint Stock Company .29 2.1.1 Overview of business activities of TTP Holdings Joint Stock Company 29 2.1.1.1 History of TTP Holdings Joint Stock Company 29 2.1.1.2 Oriented development of TTP Holdings 30 2.1.1.3 Human resources and Management Organization of TTP Holdings 30 2.1.2 Business characteristics of TTP Holdings Joint Stock Company 33 2.1.2.1 Business sectors of TTP Holdings 33 2.1.2.2 Characteristics of revenue of TTP Holdings 34 2.1.2.3 Characteristics of expenses of TTP Holdings 35 2.1.3 Accounting policy of TTP Holdings 35 Nguyen Tram Anh iv K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat 2.2 Status of accounting for revenue, expenses and evaluation of business results at TTP Holdings Joint Stock Company 36 2.2.1 Accounting for sales revenue and other income .36 2.2.1.1 Structure of revenue of TTP Holdings in 2022 36 2.2.1.2 Accounting for Sales revenue 37 2.2.1.3 Accounting for Sale deductions 45 2.2.1.4 Accounting for Finance income 45 2.2.1.5 Accounting for Other income .46 2.2.2 Accounting for expense .46 2.2.2.1 Structure of expense of TTP Holdings in 2022 46 2.2.2.2 Accounting for Cost of goods sold 47 2.2.2.3 Accounting for Selling expenses 52 2.2.2.4 Accounting for Administrative expenses 52 2.2.2.5 Accounting for Financial expenses .55 2.2.2.6 Accounting for Other expenses 55 2.2.3 Evaluation of business results 55 2.2.3.1 Accounting for Corporate income tax 55 2.2.3.2 Accounting for Evaluation of business results 56 2.3 Assessment of the status of accounting revenue, expenses and evaluation of business results at TTP Holdings Joint Stock Company .58 2.3.1 Strengths 58 2.3.2 Weaknesses 60 Conclusion of chapter 63 CHAPTER 3: DISCUSSION OF ACCOUNTING REVENUE, EXPENSE AND EVALUATION OF BUSINESS RESULTS AT TTP HOLDINGS JOINT STOCK COMPANY .64 Nguyen Tram Anh v K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat 3.1 Development orientation of the Company 64 3.2 Recommendations to TTP Holdings .65 3.2.1 Enhancing the accounting system 65 3.2.2 Strengthen management accounting 66 3.2.3 Enhancing accounting methods .68 3.2.4 Enhancing documents and the document rotation process .69 3.3 Recommendations to the Government 70 Conclusion of chapter 71 FINAL CONCLUSION 72 REFERENCES 73 Nguyen Tram Anh vi K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat LIST OF ABBREVIATIONS No Acronyms Meaning Co Ltd Company Limited CEO Chief Executive Officer CIT Corporate Income Tax COGS Cost of goods sold E-invoice An electronic invoice IT Information technology PIT Personal Income Tax SCT Special Consumption Tax SHUI The combination of three compulsory insurance in Vietnam, including the Social insurance (SI); Health insurance (HI) and Unemployment insurance (UI) 10 VAT Nguyen Tram Anh Value Addex Tax vii K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat LIST OF TABLES AND FIGURES Name Page number Diagram 1.1: Accounting diagram of Account 511 - Sale revenue according to Circular 133/2016/TT-BTC Diagram 1.2: Accounting diagram of Account 632 - Cost of goods sold according to Circular 133/2016/TT-BTC Diagram 1.3: Accounting diagram of Account 642 – Business administration expenses according to Circular 133/2016/TT-BTC Diagram 1.4: Accounting diagram of Account 515 - Finance Income according to Circular 133/2016/TT-BTC Diagram 1.5: Accounting diagram of Account 635 - Finance Expenses according to Circular 133/2016/TT-BTC Diagram 1.6: Accounting diagram of Account 711 - Other Incomes according to Circular 133/2016/TT-BTC Diagram 1.7: Accounting diagram of Account 811 - Other expenses according to Circular 133/2016/TT-BTC Diagram 1.8: Accounting diagram of Account 821 - Corporate income tax according to Circular 133/2016/TT-BTC Diagram 1.9: Accounting diagram of Account 911 - Income Summary according to Circular 133/2016/TT-BTC Figure 2.1: Management Organization of TTP Holdings Joint Stock Company Figure 2.2: Structure of revenue of TTP Holdings Joint Stock Company in 2022 Table 2.1: Main accounts for recording revenue Figure 2.3: Output VAT invoice 1C22TYY No 27 dated July 30 2022 Figure 2.4: Recording of VAT invoice 1C22TYY No 27 dated July 30 2022 on FAST accounting software (1) Nguyen Tram Anh viii 12 15 17 19 21 23 24 26 30 35 36 39 40 K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat documents and completing procedures for customers Therefore, these delivery costs need to be aggregated and allocated to the Cost of Goods Sold - Third, about the document rotation process: The rotation process of documents between other teams and the accounting team is still not timely and slow sometimes At the company, there is still a situation where documents are stagnant or left out of the accounting books, leading to loss due to the lack of clear separation of responsibility for storing documents, no process of receipt and delivery of documents Papers such as Debit Note, Credit Note when receiving a notice from website, accountants should not wait until the end of the month when receiving the monthly report to receive the documents from the bank as currently doing This will helps the Accountant to gather the records easily , but it is not timely Nguyen Tram Anh 62 K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat Conclusion of chapter Based on the analysis of the current state of accounting procedure of revenue, expense and evaluation of the Company's business results under the honest observation and detail questioning, from which the real state of accounting revenue, expenses and evaluation of business results at TTP Holdings Joint Stock company have been clearly shown and described in detail to make comments on the positive and negative aspects of the company's accounting work under the observation, The characteristics described in Chapter will be the basis and premise for the implementation of Chapter - Discussion of accounting revenue, expense and evaluation of business results at TTP Holdings Joint Stock Company Nguyen Tram Anh 63 K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat CHAPTER 3: DISCUSSION OF ACCOUNTING REVENUE, EXPENSE AND EVALUATION OF BUSINESS RESULTS AT TTP HOLDINGS JOINT STOCK COMPANY 3.1 Development orientation of the Company In the current global pandemic situation, the company's urgent goal is to focus and optimize all available resources to maintain the monthly workload to ensure stable revenue for the future expenses and at the same time create jobs and stable income for all employees or members of the company When the epidemic is completely controlled, the medium and long-term plans and strategies will be promoted During that period, the Company continues to maintain the view of sustainable development with the goal of developing to become the top reliable consulting companies for domestic and foreign companies To achieve this goal, the Company has been aiming to improve service quality, brand and professionalism, on the basis of optimally exploiting the Company's resources and advantages In the first years, the Company is implementing the strategy of diversifying the types of service providers to be able to meet all the requirements of customers, thereby diversifying the customer types and bringing the more familiar image of the Company closer to customers who have a need to popularize the company's services However, in the long run, when the company has approached enough customers and identified the main types of customers, the company wants to focus on building key services representing the company in order to be able to develop stably The fact that more and more businesses operate in the same field today will affect the business situation and development of the Company, increasing competitiveness to survive in the market With the current reality as the current business results, although the revenue still increased compared to the previous year but still reported a loss after the operating period, the company is preparing new plans to overcome that situation Nguyen Tram Anh 64 K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat 3.2 Recommendations to TTP Holdings 3.2.1 Enhancing the accounting system The company needs to invest in the accounting training process for the accounting system in order to enhance the efficiency and performance of the accounting staff In addition to the quantity factor, the quality factor is more important The high professional level of accountants is a vital factor for the whole accounting system The peculiarity of accounting work is that it requires high accuracy, meticulousness, detail, errors are not allowed to occur because even a small error can potentially cause great losses to the business Moreover, accounting work increasingly requires expertise in each section, so every accountant needs to actively study, improve professional skills and regularly update accounting knowledge in a timely manner Therefore, the company should pay attention to fostering and improving the professional qualifications and professional ethics for accounting staff, such as: Firstly, there should be clear regulations on the responsibilities, rights, obligations and working regime of each accountant Second, the company should create conditions for accounting staff to participate in refresher courses, seminars, and exchange of accounting skills so that employees can update their knowledge, improve their professional qualifications, and minimize the risk of mistakes or unnecessary errors At the same time, the company must check and evaluate the working quality of employees in order to promote self-discipline to cultivate and improve the professional qualifications of employees Third, the company should have regulations on the form of rewards and incentives for accounting staff to perform well and effectively, especially debt collection, to help promote the sense of responsibility of employees at work On the contrary, the company should also have penalties and discipline if the employees not work well, causing many mistakes, seriously affecting the company's operations Finally, for further development in the future, it is necessary to recruit more accounting staff of the accounting consulting team At the same time, the accounting consulting service will also develop further and the amount of work on accounting advice for TTP Holdings' customers will also increase, therefore, a clear division between the consulting team of accounting services for customers and internal Nguyen Tram Anh 65 K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat accounting team for the company is essential and should be implemented soon to have a clear view of the revenue and expenses structure of the Company 3.2.2 Strengthen management accounting In order to match the current situation and future development of the company, the company needs to increase the human resources of the internal accounting team to further divide the accounting operations to each individual tasks This will help the accounting work be managed and organized more effectively, in order to provide information quickly, accurately and completely In order to be able to help the company recover enough and quickly the receivables from customers, in addition to assigning responsibility to specific employees, the company should conduct an assessment of the work completion progress to make the right time to request customers to pay for contracts of high value, as well as convenient for revenue accounting of the accounting department For expenses management, in order to achieve the highest expenses efficiency, the company should closely monitor the working time of employees, avoid neglect or prolong the time of work Processes for payment and cash advance must be specified in detail, clearly and closely so that everyone understands and properly implements them For management purposes, to help the Board of Directors monitor the efficiency and profitability of each service and have clear data about the COGS of each services that the company provides and whether the services are suitable and really profitable for the Company, accountants can build a table of allocation of direct labor costs according to the net revenue of each type of service to determine the ratio of costs for each group of services to account for the cost of goods sold The table of direct labor cost allocation can be suggested to build according to the following form: Nguyen Tram Anh 66 K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat Table 3.1: Recommended form for Table of direct labor cost allocation Table of direct labor cost allocation (Month) … (year)… Regular Irregular Interpretation Total consulting consulting and translation services services services Revenue … … … … Allocation rate …% …% …% …% Direct labor costs Salary Social insurance Health insurance Unemployment insurance In addition, the Company should invest more in selling expenses to build up the image and popularize the company's image and services further, both to help the company reach more customer groups and to increase the company's recruitment efficiency The company should develop a trade discount policy for long-term customers or discount payments for customers who pay before the due date to increase customer engagement, encourage customers to pay early, and help the company recover capital quickly Accordingly, accountants need to accurately record these discounts according to regulations, in order to properly record revenue and expenses, thereby determining the business results of the enterprise Nguyen Tram Anh 67 K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat 3.2.3 Enhancing accounting methods Revenue from service provision needs to be broken down by each type of service the company provides The company can open more detailed accounts of account 511 as follows: Table 3.2 Table of recommended detailed account for sale revenue Account Account’s name 511311 Revenue from regular consulting services 511312 Revenue from irregular consulting services 511313 Revenue from interpretation and translation services This helps the Board of Directors to track the efficiency and profitability of each type of service, helping the Board of Directors to have clear data on whether the services provided by the company are suitable and really profitable for the company or not From there, the Company can reduce the supply and develop the main types, bringing in large and stable profits When TTP Holdings reduces the focus service areas and increases the size of the company, it is possible to consider opening more detailed accounts such as Revenue from regular accounting services, Revenue from irregular accounting services, Revenue from regular legal consulting, Revenue from irregular legal consulting Fees for document delivery are being recorded as business administration expenses, which is unreasonable because most of these document delivery fees are fees for sending documents and procedures for customers Therefore, these delivery costs need to be aggregated and allocated to the Cost of Goods Sold Accordingly, accountants record this cost into Account 154 - Cost for work in process, at the end of the month, when the service is completed, it will be transferred to Account 632 Cost of goods sold of the corresponding service For example, the accounting details for the freight for transporting documents to customers which TTP Holdings provides regular consulting services is as follows: Nguyen Tram Anh 68 K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat When shipping fee is incurred: Debit 154 - Cost for work in process: Credit 1111 - Cash: At the end of the month, carry forward this cost to cost of goods sold: Debit 6323 - Cost of goods sold of the regular consulting service: Credit 154 - Cost for work in process: 3.2.4 Enhancing documents and the document rotation process The departments need to coordinate more closely with each other in the document rotation process At the same time, the accounting department also needs to proactively update the status of documents in a timely and regular manner, not waiting until the end of the month to summarize In particular, although it is possible to quickly follow up on the bank's website, the accountant still has to actively download the Credit Note to complete the set of documents in time, avoiding waiting for the bank to send the documents at the end of the month, which can easily cause shortages of documents, hindering work progress When the original documents are transferred, accountants need to check, classify and arrange separately in the correct order and content to facilitate data tracking and comparison The company should check and compare documents with the books periodically to avoid the fact that some documents are still delayed in being reflected in the books If the reconciliation results detect errors, the cause should be investigated, whether it is accidental due to mistake, limited qualifications or intentional errors of accountants Once the cause is found, appropriate remedial measures should be taken It is advisable to develop a reasonable document delivery and receipt process to more closely monitor the rotation and storage of documents For example: When receiving or handing over any documents, employees need to fully record in the receipt/handover book, accompanied by the document handover minutes Original documents must be scanned to store in soft copy to avoid loss and damage, and to store hard copies in the right places Nguyen Tram Anh 69 K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat 3.3 Recommendations to the Government The state has an important role in regulating the macro-economy through laws and financial policies To help businesses perform better in the economy need to: - Improve and enhance the legal environment Currently, many enterprises face difficulties and troubles in apply complicated economic procedures that affect the operation process of enterprises themselves The Government should take effort to create a synchronous and adequate legal environment to create conditions for enterprises to develop equally in the open economic market In addition, it is also necessary to simplify administrative procedures and improve the service attitude of state officials so that enterprises not face obstacles when working with state agencies In addition, the Government also needs to invest and develop in technology to further perfect the computerized system in accounting work, helping businesses achieve efficiency in the best way with correctness accurate and complete in accounting Helping accountants and auditors not need to spend a lot of time reviewing and shortening cumbersome procedures when working - Strengthen policies to support businesses The Government needs to effectively use its resources to promote the economic development of the whole country, develop policies to support capital and tax policies to create conditions to promote production and business activities for large, medium and small enterprises From there, businesses can achieve higher efficiency in business as well as in accounting work, which will help businesses make more accurate, correct and complete decisions In fact, the Government has issued Resolution 35/2016/NQ-CP on supporting and developing businesses until 2020 with the goal of building Vietnamese enterprises with competitiveness and sustainable development However, although the Government is very determined, many local management departments have not drastically implemented this resolution effectively Nguyen Tram Anh 70 K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat Conclusion of chapter On the basis of the analysis of the positive points and limitations in accounting of revenue and expenses and evaluation of business results presented in chapter along with the bases according to the guidance of the circular and Vietnamese accounting standards and the actual operation situation and development orientation at TTP Holdings Joint Stock Company, in Chapter 3, I made some recommendations to solve the remaining limitations From there, the company can see those issues to consider and possibly change in the future Nguyen Tram Anh 71 K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat FINAL CONCLUSION Through practical research on the situation of revenue and cost accounting and determination of business results at TTP Holdings Joint Stock Company, I had the opportunity to apply what I have learned into working practice TTP Holdings is a new enterprise and the business management system in general and the accounting system in particular is still in the process of being completed Due to limited time and experience, I have not been able to take part in each aspect of service provision, but only focus on accounting for revenue, expenses and evaluating business results of the company Thereby, I have grasped the accounting of revenue, expenses and evaluation of business results as well as the construction of table systems to monitor revenue and expenses In addition, I also noticed the inappropriate points that did not meet the management requirements in this accounting work, from which I could make recommendations and suggestions to further improve the company's business results I would like to sincerely thank the enthusiastic support of the Board of Directors and colleagues at TTP Holdings Joint Stock Company, along with the devoted and wholehearted guidance of PhD Nguyen Tien Dat in the process of completing this graduation thesis I look forward to receiving suggestions from teachers to improve my thesis Thank you sincerely! Nguyen Tram Anh 72 K22CLCE Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat REFERENCES Accounting textbook - Banking Academy Circular 133/2016/TT-BTC issued on August 26, 2016 about Accounting for small and medium enterprises Accounting Standard No 14: Revenue and other income Actual figures, documents and reports of TTP Holdings joint stock company Some graduation theses of seniors Nguyen Tram Anh 73 K22CLCE Nguyen Tram Anh Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat 74 K22CLCE Nguyen Tram Anh Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat 75 K22CLCE Nguyen Tram Anh Nguyen Tram Anh Lecturer: PhD Nguyen Tien Dat 76 K22CLCE