accounting for revenue and expenses and determining business results at tan cang logistics and stevedoring joint stock company

1 MINISTRY OF EDUCATION AND TRAINING HO CHI MINH CITY OF TECHNOLOGY AND EDUCATION FACULTY OF ECONOMICS  GRADUATION THESIS Ho Chi Minh City, November 2023 ACCOUNTING FOR REVENUE AND EX

INTRODUCTION ABOUT TAN CANG LOGISTICS AND

Company introduction

− Full Vietnamese name: Công ty Cổ Phần Đại Lý Giao Nhận Vận Tải Xếp Dỡ Tân Cảng

− International transaction name: Tan Cang Logistics And Stevedoring Joint Stock Company

− Legal representative: Lê Văn Cường

− Address: 470 Dong Van Cong Street, Quarter 2, Thanh My Loi Ward, Thu Duc City, Ho Chi Minh City

− E-mail: marketing@tancanglogistics.com.vn

+ Cargo transportation by car, inland waterways

+ Import and export freight forwarding services

+ Warehousing, inventory, and packaging services (except for pesticide trading)

Source: Finance - Accounting Dept 1.1.2 Formation and development

− In 2006 (predecessor): Tan Cang Logistics & Stevedoring Enterprise was founded under Decision no 82/2006/QD-BQP Tan Cang Logistics and Stevedoring Joint Stock Company was founded in 2007 with the help of a financial infusion from Tan Cang Overland Transportation Joint Stock Company In 2008 saw the official launch of the customs agent service In 2009: 17.000.000 shares were listed under the stock symbol TCL, and the first transaction was executed on December 24

− In 2010, the charter capital was raised to 186.999.050.000 VND by issuing 1.700.000 bonus shares to current owners In 2011, by issuing 6.300.000 shares to the public, raised the charter capital to 209.438.930.000 VND In 2012, the company's whole capital investment was assigned to Tan Cang Waterway Transport Joint Stock Company In 2013, the following things happened: restructuring capital at Tan Cang

128 - Hai Phong Joint Stock Company; providing funding for Tan Cang Offshore Services Joint Stock Company; transferring all the company's capital contributions to Tan Cang Overland Transportation Joint Stock Company

− In 2014, saw the purchase of 1 container transport ship and a lease from Tan Cang Shipping Service Joint Stock Company, as well as the opening of Depot Tan Cang - My Thuy In 2015, contributed funds to the establishment of Dong Nai Newport Logistics Joint Stock Company; transferred ownership of the Tan Cang Pioneer ship to Tan Cang Shipping Service Joint Stock Company In 2016, decided to establish customs clearing facility at Tan Cang - Nhon Trach In 2017, transferred the full the company's capital contribution to Tan Cang Shipping Service Joint Stock Company; decided to form Professional Team 2 of Nhon Trach Customs Branch working at ICD Tan Cang - Nhon Trach

− In 2018, opened the 12-story TCL Building and invested in the construction of 5.000 m 2 of warehouses at ICD Tan Cang - Nhon Trach In 2019, restructuring Tan

Cang Logistics Joint Stock Company in Dong Nai by raising charter capital and launching the cold cargo closure service at Depot Tan Cang - My Thuy The charter capital was increased to 301.584.360.000 VND In 2020, Depot Tan Cang - My Thuy

2 was expanded and operational In 2021, launched the SITC's chilled container operating service at ICD Tan Cang - Nhon Trach and established the freight forwarding zone at Tan Cang - Cat Lai port

− In 2022, opened the empty container pickup service from the Cai Mep region to ICD Tan Cang - Nhon Trach, as well as offering logistical services for Maersk Shipping Lines in Dong Nai, Binh Duong, and Ba Ria - Vung Tau It achieved the Top 3 Listed Enterprises with the most popular IR activities - IR Awards 2022 as well as the Top 3 Listed Enterprises with the highest rating of IR activities by financial institutions - IR Awards 2022

Tan Cang Logistics and Stevedoring Joint Stock Company is a subsidiary of Saigon New Port Corporation, operating under the model of parent company - subsidiary company, performing independent business accounting according to the Law on Enterprises and the operating charter of the joint stock company

The business offers suggestions for carefully controlling personnel and equipment to maximize economic effectiveness Directly arranged for transportation- related assistance services: Ship supply, customs clearance, logistics, and marine brokerage services are just a few of the services offered for import and export freight forwarding Ground leveling, building civil engineering projects, trade in machinery and equipment and machine components, as well as services for loading and unloading products and packing Direct assistance with purchasing and selling containers, trailers, leasing machinery and equipment, and purchasing and selling tangible equipment for canal transport, repair and maintenance of transportation equipment, and road passenger transport

The company's operating objective is to continuously maintain and develop production, business, trade and service activities in the fields and business lines that the company has registered in accordance with the provisions of law Current to maximize company profits; improve and enhance the value of the company; improve

7 income, working environment conditions, and lives of employees in the company, ensuring the best benefits for shareholders; Carry out obligations to the State budget in accordance with the provisions of law, and at the same time successfully complete economics and defense tasks assigned by Saigon Newport Corporation

Concentrate on growing sectors that are related to the business's core, important, and strong skills, such as port operations, warehousing, and support services for port operations To ensure efficiency and sustained development, investment projects must have a long-term lease and partnership duration Keep spending money on important projects: Projects to build and operate warehouses at ICD Tan Cang - Nhon Trach and to utilize TCL Depot - Long Binh

Focus on enhancing service quality; continue to maximize benefits and maintain efficient operations in all areas and business lines of the firm; optimize the performance of the company's services to guarantee efficient production and business operations

Along with aggressively searching out and creating new business opportunities, long-term, sustainable services, and land funding to keep up the expansion of Depot/ICD exploitation, businesses must also actively seek out and create new business establishments When planning forwards to invest in infrastructure, we will evaluate the market demands Develop the Company into a powerful, enduring, and well-known brand in the domestic and regional markets; maintain average growth of at least 5% annually Using information technology in business administration and management; emphasizing the hiring and training of top-tier staff to be prepared for the company's upcoming initiatives Enhance management capabilities, ensure efficient use of money, and carry out financial work in a transparent, efficient, and in line with actual company conditions.

Management apparatus

According to the business features of the firm and the charter of organization and operations approved by the Board of Members, the management apparatus of the company is divided into departments as illustrated in the diagram below:

Diagram 1 1 Organizational diagram of the company

Source: Administration - Warehouse Dept 1.2.2 Functions and tasks of each department

General Meeting of Shareholders: Approving the development orientations of the company Making the decisions on amendments and supplements to the charter; Electing, dismissing the Board of Directors and members of the Board of Supervisors Approving the company's annual financial statements

Board of Directors: General management of all activities of the company, supervision of the Director and members of the Board of Supervisors through reports at regular meetings of the Board of Directors, extraordinary meetings,

C at L ai - E aster n Sai Go n J SC

Do n g Nai New p o rt L o g is tics J S C T an C an g - B en T h an h C o rp o ratio n

T an C an g 128 - Hai Ph o n g J SC

FIN ANCE - AC C OUNT IN G DE PT

PLAN NI NG - B USI NE SS DE PT ADM INI STRATI ON - W A R E HOUSE DE PT DE PT OF L AB O R O R GANI Z AT ION - SALA R Y T E C HNI C AL MA T E R IAL S DE PT

INVE STM E NT - L E GAL DE PT DI SP AT C H D E PT IC D T AN C AN G -NHON T R AC H ME C HANI C AL DE PT

9 implementation of strategies, objectives, contents, and business plans approved by the General Meeting of Shareholders and the implementation and organization of the implementation of resolutions of the Board of Directors

Supervisory board: Responsible for supervising the Board of Directors in the management and operation of the company, responsible for the General Meeting of Shareholders for monitoring the financial situation of the company

General manager: Including the Director and Deputy Director; in the Director has the right to make decisions about matters pertaining to the company's day-to-day operations without coming under the authority of the Board of Directors, on behalf of the company to actively negotiate, make decisions about, and sign transactions and contracts to ensure the company's effectiveness dependent on the execution of production and business plans The Deputy Director oversees assisting the Director in running the business, overseeing each distinct area of work, and routinely reporting to the Director on the issues that need to be resolved

Finance - Accounting Department: Strictly manage and supervise effectively all economic and financial activities, provide adequate, timely, honest, public, and transparent to meet the requirements of organization, management and administration of the company and financial decisions within the company

Planning - Business Department: Receiving and synthesizing information, advising the General manager on the following aspects: Production and business planning, investment and development projects, marketing - external affairs

Administration - Warehouse Department: Responsible for advising and assisting the General manager on the organization of administrative - logistical security, performing the management of defense and security tasks fully, timely, and production and business of the company and completing the assigned tasks

Department of Labor Organization - Salary: It has the function of advising the

General manager on the organization and construction of labor resources, wages, social policies, and labor safety in enterprises in accordance with the provisions of law

Investment - Legal Department: Ensuring that all activities of the enterprise can operate in accordance with the law, helping the management to perform tasks such

10 as, participating in the negotiation and negotiation of important contracts of the enterprise with partners in business, cooperation contracts, investment projects to ensure that they are not illegal, legal errors can lead to damage to the enterprise

Technical - Materials Department: Directly organize the implementation of technical and material assurance, equipment procurement and professional training, to improve the skills of workers, repair quality and efficiency of using technical equipment, meet the requirements of production and business activities of the company and complete other assigned tasks

Dispatch Department: Advising the Party Committee - General manager on measures to strictly manage the company's system in lifting, determining the location of containers and managing warehouses

ICD Tan Cang - Nhon Trach: As a gathering point for import and export goods, connecting Nhon Trach area with Tan Cang - Cat Lai port, Tan Cang - Hiep Phuoc port, Tan Cang - Cai Mep deep-water port cluster, advising the Party Committee - General manager on strict and accurate management measures of the output of Tan Cang Nhon Trach

Mechanical Department: Advising the Party Committee - General manager on measures to strictly manage and effectively exploit technical means and equipment and directly organize the handling and transportation of internal goods in the port by the crane according to the production and business plan

Subsidiary & Affiliated companies: Providing the full range of services required and mobilized by the parent company In addition, subsidiaries and affiliated companies are also allowed to conduct their own business with their own customers to the extent permitted

Accounting apparatus

Source: Finance - Accounting Dept 1.3.2 Functions and tasks of departments

Chief Accountant: Lead and manage the operation of the department according to its competence and tasks, assign tasks to each accountant in the department Take responsibility for the operation of the department and be responsible to the General manager as well as the law for the inspection of the financial activities of the company

General Accountant: Monitor department operations, review and synthesize data Directly check, supervise, and monitor the work of everyone in the room

Responsible for checking data, analyzing, preparing general books, preparing accounting documents, ledgers and preparing annual settlement reports, setting up funds, filing of returns and corporate income tax declarations Prepare value added tax reports and monthly personal income tax reports

Treasurer: Record and monitor the cash collection and payment situation, check invoices at Depots before synthesizing monthly tax reports; store documents, economic contracts, vouchers for book entry, accounting books as prescribed, etc

Cash Accountant: Monitor and manage cash receipts and expenditures at the fund, check and compare documentary data with data on the cash book to coordinate

Fixed Assets - Capital Construction Accountant

Revenue - Cost Accountant Cat Lai Area - Salary Accountant

125 Area, Cash at Bank Accountant

12 cash flow appropriately when paying to company operations Prepare cash receipts and cash payments

Revenue - Cost Accountant Nhon Trach Area: A summary of the revenue and expenses for the Tan Cang Nhon Trach port area's terrestrial port exploitation services, storage services, dry and cold container transportation services, etc

Revenue - Cost Accountant My Thuy Area: A summary of revenue and expenses of management services, empty container exploitation (dry and cold), packing and unloading cold goods at the yard in My Thuy area

Revenue - Cost Accountant Cat Lai Area, Salary Accountant: A Summary of revenue and expenses of multi modal transport services combined with other modes of transport in the Cat Lai area; allocating salaries, social insurance, and policies to employees

Revenue - Cost Accountant 125 Area, Cash at Bank Accountant: A summary of revenue and expenses of rice packing services at the wharf 125 in Tan Cang - Cat Lai port area; monitor bank accounts, receivables and payable through banks Closely check the implementation of contracts and bank loan agreements

Fixed Assets - Capital construction Accountant: In charge of monitoring the accounting of technical supplies, spare parts, fuel, construction investment, major repair of fixed assets, cost of leasing yards, registration, inspection, cost of tools and tools, office rental, monitoring the situation of fixed assets, monthly depreciation of fixed assets

Revenue - Cost Management Accountant: In charge of summarizing monthly service revenue at the company; monitoring transportation, loading, and unloading expenses, telephone expenses, service gap expenses, allowances, receivables from customers, bonus funds, welfare funds, trade union funds; monitoring the company's share book information, etc

1.3.3 The current accounting policies in the company

− Accounting policies: Circular No 200/2014/TT-BTC dated December 22,

2014, and Vietnamese Accounting Standards - VAS issued by the Ministry of Finance

− The annual year of the Company shall start from January 01 and end on December 31 of each year

− Monetary unit: Vietnam Dong (VND)

− VAT declaration by deduction method

− Inventory accounting by the method of regular declaration Calculate the export price according to the weighted average method at the end of the period

− Depreciation method: Straight-line depreciation method

− Tan Cang Logistics And Stevedoring Joint Stock Company use the following accounting form: Computerized accounting form

− Currently the company is using Lemon 3 accounting software with Excel support

− Decentralization in the company's accounting work: The Chief Accountant and General Accountant have full access to data in the software Accountants will be assigned data access rights depending on assigned work tasks

Diagram 1 3 Order of recording accounting books in a diagram

The accounting of major operations is carried out as follows:

Every day, relying on the vouchers and the allocation and accounting tables that enter data into the software in a chronological order, the software will automatically update the information in the Ledger and related detailed books

At the end of the accounting period, the accountant performs the closing operation and prepares financial statements The reconciliation between aggregated

Print the data and reportsat the end of the year

14 data and detailed data is done automatically according to the information entered during the period Accountants can check and compare data between accounting books and financial statements

Figure 1 2 Lemon 3 Accounting Software Interface

Chapter 1 provides an overview of the history of formation and fields of operation of Tan Cang Logistics And Stevedoring Joint Stock Company Besides, chapter 1 also introduces the detail about the organizational system, functions, and duties of the departments in the company, especially the functions and duties of accounting department, the accounting regimes, policies, forms, and accounting software applied at the company The organizational structure of the company is very strict and fair, each department is assigned clear functions and tasks

THEORETICAL UNDERPINNINGS OF REVENUE AND

Concepts and tasks of accounting to determine business results

− According to Vietnamese Accounting Standard No 14, “Turnover means the total value of economic benefits gained by an enterprise in an accounting period, which arise from the enterprise’s normal production and business operations, contributing to increasing the owner’s capital”

− According to Vietnamese Accounting Standard No 01, “expenses are the total value of amounts which reduce economic benefits in the accounting period in the forms of amounts spent, asset depreciation amounts, or give rise to liabilities leading to a decrease in the owners’ equity, excluding amounts distributed to shareholders or owners”

− Business result is the amount of profit or loss brought about by the business activities of the enterprise

2.1.2 Duties of revenue and expenses accounting and determination of business results

− Calculate all revenue generated in the period, including revenue from sales of goods and services, financial revenue, and other revenue Then, track revenue by item, region, sales staff according to management standards

− Monitor and timely record sales discounts, trade discounts, returned sales to calculate reasonable net sales income

− Determine the cost of products sold in the period

− Calculate all expenses incurred in the period, including expenses related to selling expenses, corporate administrative expenses, financial expenses, depreciation expenses, allocation of prepaid expenses, interest expenses, accrued expenses and other expenses

− Prepare salary and bonus tables for employees, which include deductions for trade union, social insurance, health insurance, etc

− Accrued bad debts, unemployment benefits, warranty expenses, restructuring expenses

2.1.2.3 Accounting tasks to determine business results

Calculate net revenue, gross profit from sales and service provisions, net profit from operations, other profits, total pre-tax profit, and current business income tax expenses Earnings per share of joint-stock enterprises, profits after enterprise income tax and deferred business tax expenses.

Accounting of revenue and other incomes

2.2.1 Accounting for turnovers from selling goods and provisions of service

According to Vietnamese Accounting Standard No 14, “Turnovers from selling goods and provisions of service is defined as the entire amount obtained, or will be obtained, from transactions and transactions that generate revenue such as sales of products and goods, provision of services to customers including surcharges and fees collected in addition to the selling price (if any)”

According to Article 79, Section 1.6.10 of Circular No 200/2014/TT-BTC, principle on recording the turnovers for the sale of goods and provisions of services include:

− Accrual basis: Revenue recognized at the time of the transaction, when certain economic benefits are obtained, is determined according to the fair value of the amounts entitled to be received, irrespective of whether money has been collected or will be collected

− Matching: When recognizing a revenue, an appropriate expense must be recognized

− Prudence: Revenue and income will be recognized when there is credible evidence of financial gain

According to Article 79, Section 1.3 of Circular No 200/2014/TT-BTC, an enterprise shall only record turnovers from selling goods if simultaneously satisfies the following conditions:

− The enterprise has transferred the majority of risks and benefits associated with the right to own the products or goods to the buyer

− The enterprise no longer holds the right to manage the goods as the goods owner, or the right to control the goods

− Turnover has been determined with relative certainty

− The enterprise has gained or will gain economic benefits from the good sale transaction

− It is possible to determine the expenses related to the goods sale transaction

− Cash receipts, Credit notes of the bank, etc

Account 511 “Turnovers from sales and provisions of services” does not have ending balance and comprises six level 2 accounts in detail:

− Account 5112: Turnovers from finished goods

− Account 5113: Turnovers from service provision

− Account 5114: Subsidized or price supported turnovers

− Account 5117: Turnovers from investment property

2.2.2 Accounting for revenues from financial activities

Documents used

− Sales invoice or VAT invoice

− Credit notice of the bank, etc.

Account applied

Account 515 “Revenues from financial activities” does not have ending balances

+ VAT payable under direct method (if any)

+ Transferring net revenues from financial activities into account 911 “Income Summary”

Revenues from financial activities incurred in the period

Account 515 does not have ending balances.

Accounting flowchart of revenues from financial activities

Accounting for other income

According to Article 3 of Vietnamese Accounting Standard No 14, “Other incomes mean revenues contributing to increasing the owner’s capital, which are generated from operations other than turnover-generating operations”

− Decision on liquidation or sale of fixed assets

− Tax receipt, fines receipt, ect

Account 711 “Other income” does not have ending balance

+ VAT payable (if any) computed under direct method on Other Income of business which pay VAT under direct method

+ At the end of the account period, posting

Other Income generated during the period to

Other income incurred during this period

Account 711 does not have ending balance

Source: Article 94, Section 2 of Circular No 200/2014/TT-BTC 2.2.3.3 Accounting flowchart of other income

Source: The author synthesizes based on Circular No 200/2014/TT-BTC

Accounting for revenue deductions

According to Article 3 of Vietnamese Accounting Standard No 14, “Trade discount means a reduction of the listed price granted by the selling enterprises to the buyers of large volumes of goods”

According to Article 3 of Vietnamese Accounting Standard No 14, “Sales allowances means a price reduction granted to the buyers due to the goods’ inferior quality, wrong specifications or old-fashionedness”

According to Article 3 of Vietnamese Accounting Standard No 14, “Sales returns means a sum of money reduced by the sellers for the buyers who make full payment for the goods before the contractual deadline”

− Sales invoice or VAT invoice

− Minutes of agreement of the buyer and seller on the return of goods

− Minutes of discount agreement (if any), etc

Account 521 “Revenue deductions” does not have ending balance and comprises 3 level 2 accounts in detail:

+ Trade discount accepted to settle for customers

+ Sales allowances agreed for buyers

+ Revenues sales returns of which buyers are refunded, or which are deducted from accounts receivable of customers about sold products, goods volume

At the end of the account period, transferring the total trade discount, sales allowance, and revenues of sales returns to account 511 -

“Revenue from sales and service provisions” to determine net sales of the reported period

Account 521 does not have ending balance

Source: Article 81, Section 2 of Circular No 200/2014/TT-BTC 2.3.6 Accounting flowchart of revenue deductions

Source: The author synthesizes based on Circular No 200/2014/TT-BTC

Cost accountant

2.4.1 Accounting for cost of goods sold

According to Article 89, Section 1 of Circular 200/2014/TT-BTC, “Cost of goods sold is the actual ex-stock price of the product (or including the purchase cost allocated to the goods sold in the period for commercial enterprises), or the actual cost of services, completed services and other items included in the cost of goods sold in the period to determine the business results in the period”

Account 632 “Cost of goods sold” does not have ending balances

For activities of production and trade, this account records:

+ Transferring cost price of products, goods, services sold during period

+ Cost price of products, goods, services sold during the period

+ Expenses of raw materials, materials, part of labor expenses in excess of normal level, and fixed overhead cost unallocated and added to expenses of goods during the period

+ Waste, loss of inventory after excluding compensation received from responsible individuals

+ Expenses of building, of business’ own made fixed assets in excess of normal level, which are not added to prime cost of firm’s own made tangible fixed assets

+ Provision for devaluation in inventory value (difference between allowances for decrease in inventory value planned for this year and redundancies of allowances planned for last year)

For activities of invested business real estate, this account records:

+ Depreciation of investment real property for lease in the period

+ Expenses of upgrading and improving investment property which is not eligible to be charged to prime cost of investment property

+ Expenses incurred from operation of investment property lease in period to account 911 “Income Summary.’’

+ Transferring total expenses of investment property business incurred in period to determine trading results

+ Remission of provision for devaluation in inventory value at fiscal year-end (negative difference between provision planned for this year and that of last year)

+ Sales returns to be stored

+ Remission of accrued expense for real estate determined to be sold (the difference between the accrued expenses higher than actual expenses incurred)

+ Trade discounts, sales allowance received after purchasing consumed goods

+ The import tax, special excise tax, environmental protection tax calculated to the value of goods purchased when delivering goods for sale, but such taxes are refunded

+ Net book values of investment property liquidated in period

+ Expenses of selling, liquidating transactions of investment property, incurred in the period accrued expense for real estate determined to be sold

Account 632 does not have ending balances

Source: Article 89, Section 2 of Circular No 200/2014/TT-BTC 2.4.1.3 Accounting flowchart of cost of goods sold

Flowchart 2 5 Account 632 (applies perpetual inventory method)

Source: The author synthesizes based on Circular No 200/2014/TT-BTC 2.4.2 Accounting for selling expenses

According to Article 91, Section 1 of Circular 200/2014/TT-BTC, “Selling expenses are expenditures that enterprises have spent in process of selling products, goods, providing services, including publicity expenses, demonstration expenses, advertising expenses, sale commission, warranty charges of goods and products (excluding construction activity), maintenance charges, cost of packing, transportation, etc”

− Payroll sheet, salary allocation table (if any)

− Delivery notes for materials, tools and supplies; Allocation table of raw materials, tools, and fixed assets

− Allocation table of prepaid expenses

− VAT invoices, sales invoices, etc

Account 641 “Selling expenses” does not have ending balances and comprises 7 level 2 accounts in detail:

− Account 6412 - expenses of materials, package

− Account 6413 - expenses of tools, supplies

− Account 6414 - Depreciation expenses of fixed assets

− Account 6417 - expenses of outsourcing services

Expenses incurred relating to the process of selling products, goods, rendering services incurred in period

+ Items reduced selling expenses in the period

+ Transferring selling expenses to Dr

911 “Income Summary” to calculate operating results in the period

Account 641 does not have ending balances

Source: Article 91, Section 2 of Circular No 200/2014/TT-BTC 2.4.2.3 Accounting flowchart of selling expenses

Source: The author synthesizes based on Circular No 200/2014/TT-BTC

2.4.3 Accounting for general administration expenses

According to Article 92, Section 1 of Circular 200/2014/TT-BTC, “General administration expenses are expenditures that enterprises have spent related to administrative management and business administration activities of enterprises”

− Payroll sheet, salary allocation table (if any)

− Delivery notes for materials, tools and supplies; allocation table of raw materials, tools, and fixed assets

− Allocation table of prepaid expenses

− VAT invoices, sales invoices, etc

Account 642 “General administration expenses” does not have ending balance and comprises 8 level 2 accounts in detail:

− Account 6421 - Expenses of administrative staffs

− Account 6422 - Expenses of administrative materials

− Account 6423 - Expenses of office requisites

− Account 6424 - Depreciation expenses of fixed assets

− Account 6427 - Expenses of outsourced services

+ General administration expenses actually incurred in the period

+ Provision for bad debts, provisions for payables (positive difference between provision for this period and unspent provision for last period)

+ Items reduced general administration expenses

+ Returning provision for bad debts, provisions for payables (negative difference between provision for this period and unspent provision for last period)

+ Transferring general administration expenses to account 911 “Income Summary”

Account 642 does not have ending balance

Source: Article 92, Section 2 of Circular No 200/2014/TT-BTC 2.4.3.3 Accounting flowchart of general administration expenses

Source: The author synthesizes based on Circular No 200/2014/TT-BTC 2.4.4 Accounting for financial expenses

According to Article 90, Section 1 of Circular 200/2014/TT-BTC, “Financial expenses are expenses or losses relating to financial investment activity, expenses of lending and borrowing, expenses of capital contributed to joint venture, to associates, losses from short-term security transfer, expenses of security selling transaction;

32 provision for business security decrease, provision for losses from investment in other units, losses incurred when selling foreign currency, losses from exchange rate, etc”

− Sales invoice or VAT invoice

− Debit note from the Bank, etc

Account 635 “Financial expenses” does not have ending balances

+ Interests expenses of loan, of credit purchases, of financial lease

+ Losses from selling foreign currency

+ Losses from liquidating, transferring investments

+ Loss on exchange rates incurred in period; Losses on exchange rates revaluated at fiscal year-end of accounts derived from foreign currencies

+ Provision for decreases in business security price, provision for loss from investment in other units

+ Expenses of other financial investment activities

+ Return of provision for business security price decrease, provision for loss from investment in other units (difference between provision planned for this period and that of last year) + Items recorded a decrease in financing expenses

+ At the end of the account period, closing out total expenses incurred in the period to determine trading results

Account 635 does not have ending balances

Source: Article 90, Section 2 of Circular No 200/2014/TT-BTC 2.4.4.3 Accounting flowchart of financial expenses

Source: The author synthesizes based on Circular No 200/2014/TT-BTC 2.4.5 Accounting for other expenses

According to Article 38 of Vietnamese Accounting Standard No 01, “Other expenses include expenses other than production and business expenses arising in the process of normal business operations, such as expenses for liquidation and sale of fixed assets, fines imposed by customers for contract breaches, etc”

− Decision on liquidation or sale of fixed assets

− Tax receipt, fines receipt, etc

Account 811 “Other expenses” does not have ending balance

Accounting for other expenses At end of account period, posting total other expenses incurred during period to Acc 911 “Income Summary

Account 811 does not have ending balance

Source: Article 94, Section 2 of Circular No 200/2014/TT-BTC 2.4.5.3 Accounting flowchart of other expenses

Source: The author synthesizes based on Circular No 200/2014/TT-BTC

2.4.6 Accounting for business income tax expenses

According to Article 3 of Vietnamese Accounting Standard No 17, “Income tax expense (tax income) is the aggregate amount of current income tax expense and deferred income tax expense included in the determination of profit or loss for the period”

Corporate income tax finalization declaration

Account 821 “Business income tax expenses” has no ending balance and comprises 2 level 2 accounts in detail:

− Account 8211 - Current business income tax expenses

− Account 8212 - Deferred business tax expenses

+ Business income tax expenses currently incurred during the year

+ Current business income tax of previous years payable additionally due to detecting insignificant errors of the previous year recorded an increase in current business income tax expense of the current year

+ Deferred income taxes expenses incurred during year from recording deferred income tax payables (positive differential between deferred income tax incurred in year, and deferred income tax payables which were returned during the year)

+ Recording deferred income tax expenses (positive differential

+ Current business income tax actually paid in a year, which is smaller than income tax expenses temporarily payable, will be deducted from current business income tax expenses recorded during the year

+ Business income tax payable recorded a decrease due to detecting insignificant errors of the previous year and recorded an increase in current business income tax expense of the current year

+ Decrease record of deferred business income tax expenses and recording deferred income tax assets (positive difference between deferred income tax incurred in year and deferred

36 between deferred business income tax which were returned in a year, and deferred income tax incurred during the year)

+ Posting differential between amount of

Cr 8212 “Deferred income tax expenses”, which is greater than amount of Dr 8212 “Deferred income tax expenses” incurred in period, to Cr

911 “Income Summary” income tax assets returned during year)

+ Decrease record of deferred income tax expenses (positive differential between deferred income tax payables which has been returned during year and deferred income tax payables induced during year)

+ Transferring positive difference between current income tax induced in year, and decreasingly recorded amount income tax expenses in year, to Account 911 “Income Summary” + Transferring positive differential between amount at Dr 8212, and amount at Cr 8212 “Deferred business income expenses” induced in period, to Dr 911 “Income Summary”

Account 821 has no ending balance

Source: Article 95, Section 2 of Circular No 200/2014/TT-BTC 2.4.6.3 Accounting flowchart of business income tax expenses

❖ Accounting for current business income tax expenses

❖ Accounting for deferred business tax expenses

Source: The author synthesizes based on Circular No 200/2014/TT-BTC

Accounting for income summary

According to Article 30 of Vietnamese Accounting Standard No 01, “Profits are used as a measure of the business results of enterprises The elements directly related to the profit determination are revenues, other incomes and expenses”

According to Article 96, Section 1 of Circular No 200/2014/TT-BTC:

• Net profit from operations = (Net revenues from sales and service provisions + Financial income) – ( expenses of goods sold + Financial expense + Selling expense + Enterprise administrative expense)

• Other profit = Other income – Other expenses

• Total pre-tax profit = Net profit from operations + Other profit

• Profits after enterprise income tax = Total pre-tax profit – Business income tax expenses

Account 911 “Income summary” does not have ending balance

+ expenses of products, goods, investment perpetration and services which were sold

+ expenses of financial activities, income tax expenses and other expenses

+ Selling expenses and General administration expenses

+ Net revenues from products, goods, investment properties and services sold in period

+ Revenues from financial activities, Other Income, and decreased record in business income tax expenses

Account 911 does not have ending balance

Source: Article 96, Section 2 of Circular No 200/2014/TT-BTC 2.5.3 Accounting method for determining business results

Source: The author synthesizes based on Circular No 200/2014/TT-BTC

In Chapter 2, the author has presented an overview of the basic theories of accounting to determine the business performance of an enterprise, which will help readers have a background on the theoretical basis of accounting for determining business performance At the same time, the accounting principles, accounting methods and some basic account diagrams have been systematized for practical analysis to help readers understand and grasp the basic knowledge This is the foundation for readers to understand deeper the content of the following chapters

CHAPTER 3: THE COMPANY'S CURRENT REVENUE AND EXPENSES

ACCOUNTING SITUATION AND BUSINESS RESULTS

Revenue accountant

3.1.1 Accounting for turnovers from selling goods and provisions of service

Turnovers from selling goods and provisions of service of the Company are generated from sources such as: Container loading and unloading at the yard, container delivery services, depot services, goods closing and withdrawal services, customs clearance services, office leasing, vehicle leasing, etc The company's revenue is recognized by each type of service and region

The time of revenue recognition is when the company completes the service and is confirmed by the customer to have completed the service through valid documents certified by both parties After performing the service, the commercial team of the Planning - Business Department of the Company will issue an invoice to the customer to collect money immediately, and return the set of documents to the Finance - Accounting Department for accounting to record revenue

3.1.1.2 Documents used a) Documents used in connection with transportation services, stevedore service, warehousing

Diagram 3 1 Process of circulating revenue vouchers for transportation services, stevedore service, warehousing

Conditional on the arising operations, the production synthesis team of the Business Department will prepare a production summary based on the data collected

Production report Payment sheet VAT invoice

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41 on the TTOS system and CMS (Depot/ ICD mining management software) with the digital signature of the Deputy Director, then send it by email to the customer to sign for confirmation When receiving the customer's consent, the commercial team will proceed to apply the price and prepare the Payment sheet After applying the price, the commercial team will send the Payment sheet to the customer for approval and then submit it to the Director for signing and issue a VAT Invoice with the company's digital signature and send it by email to the customer Revenue accountant is based on a set of documents including Payment sheet, VAT invoice that the commercial team sends to enter data into the accounting software and print the Debit note to save the documents b) Documents used related to the revenue from stuffing/unstuffing services (bagged rice, fertilizer, rice husk, coconut fiber, etc.), iron coils, machines

Diagram 3 2 Rotation process for revenue from stuffing/unstuffing services iron coils, machines

When customers need to stuff/ unstuff services (30 kg/bag), or iron coils or machines, they will contact by mail with the Dispatch Department to register the quantity and time of goods and enclose the Booking confirmation that customers have worked with the carrier before Next, the commercial team of the company will rely on Booking confirmation to make a Request payment letter and wait until the customer transfers the payment for the service, the Dispatch Department will let the workers carry out the goods After completing the service, the commercial team will issue a VAT invoice with digital signature and send it by email to the customer, then send the set of documents via internal mail to the Accountant When the accountant receives the VAT invoice with the attached documents, they will

Request payment letter VAT invoice

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42 check and enter the data The set of documents includes the Booking confirmation, the Request payment letter, and the VAT invoice recorded by the Accountant in the Bookkeeping (GS) file according to the order number recorded on the document for monitoring

Use the detailed 511 account according to each revenue item of the company: Account 51130: Turnovers from loading and unloading services at the yard Account 51131: Regional 125’s services turnovers

Account 511321: Turnovers from shipping services

Account 51133: Turnovers from services in Tan Cang - Nhon Trach area

Account 511371: Turnovers from joint venture activities at Depot 6 - IMO Account 511372: Turnovers from joint venture activities at Tan Cang - My Thuy Account 511373: Turnovers from joint venture activities of Office Building Account 51138: Turnovers from rental vehicles

Accounts used related to revenue:

Account 1310: Receivable for internal unit service fee

Account 1311: Receivable for external service fees, transfer goods

Account 1312: Receivable for stuffing/unstuffing services fees

Account 1313: Receivable for service fee at Nhon Trach wharf

Account 1319: Other service fee receivable

➢ Account 333 - Taxes and other payables to the State:

Transaction 1: On December 26, 2022, make a Receivable Debit Note of Tan

Cang - Phu Huu JSC with the number of GS/089/12/2022, the internal transshipment service fee of the container based on VAT Invoice No 2115; and the lifting and transshipment fee of the container based on VAT Invoice No 2128; and attached to the Payment Sheet (Appendix 1):

Transaction 2: On December 26, 2022, make a Receivable Debit Note of Tan

Cang - Ben Thanh Company for renting a tractor truck with the number GS/091/12/2022 based on VAT Invoice No 2151, and Payment Table (Appendix 2):

Transaction 3 On December 30, 2022, make a Receivable Debit Note for

Maersk shipping lines and shipping containers with the number GS/173/12/2022 based on VAT Invoice No 2320, and Request payment letter (Appendix 3):

Transaction 4: On December 31, 2022, make a Receivable Debit Note of Kien

Vang Logistics Co., Ltd for transportation fee in Tan Cang - Nhon Trach area with the number of GS/180/12/2022 based on VAT Invoice No 10194, and Request payment letter (Appendix 4):

Transaction 5 : On December 31, 2022, make a Receivable Debit Note of Binh

Dinh Food JSC with the number of GS/321/12/2022, the fee for closing rice from the barge to the container based on VAT Invoice No 1659, attached with the Request payment letter, and Booking confirmation (Appendix 5):

Transaction 6: After the arising economic transactions are accounted into the software, the software will automatically update the data in the accounting books At

44 the end of the accounting period, automatic closing entries will be made on the software, and data will be transferred to determine business results Closing entry:

3.1.2 Accounting for revenues from financial activities

Revenues from financial activities of the company are mainly from interest on bank deposits (with and without bank term), interest on investment in shares and bonds, receiving dividends from subsidiaries and associated companies (Dong Nai Newport Logistics JSC, Tan Cang - Ben Thanh Corporation, etc.) and payment exchange rate differences (from fixed asset investment activities, customer payments, etc.)

− Interest sheet detailed by loan contract

− Detailed accounting book of the bank's account

Diagram 3 3 Rotation process for financial activity revenues

Dependent on the detailed accounting books of the bank account, the Credit note, the interest notes of the bank, the accountant will check the relevant contracts, records, and documents to account for the revenue of financial activities in the software Accounting data will be automatically updated by the software into the general ledger and the detailed ledger, at the end of the accounting period, the accounting entries will be automatically transferred to determine the business results

Documents: The detailed accounting books of the bank's account, Credit note, Interest slip, dividend payment notice will be saved according to each company account opened at the bank

Detailed accounting book of the bank's account

Credit note Interest sheet Notice of dividend payment, etc

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Accountants can log into the company's account at the bank to monitor and update the status of financial activities revenue and bank transactions as quickly and promptly as possible

The company uses account 515: Revenues from financial activities, detailed by each revenue item As follows:

Account 5151 Revenue from interest on bank deposits

Account 5152 Revenue from interest on investment in stocks and bonds Account 5153 Exchange rate differences

Accounts used in connection with revenue from financial activities:

Account 13881 Receivable of compensation fees

Transaction 1: On June 30, 2022, the accountant made a Debit Note for the number of GS/323/06/2022 invoices accounting for the dividends receivable from Cat Lai Port JSC according to Decree No 17/NQ-DHDCD/CLL at a rate of 24%, enclosed with the information disclosure table on the portal of the State Securities Commission, and the Minutes of the 2022 Annual General Meeting of Shareholders

Transaction 2: On September 30, 2022, the accountant made a Debit Note for the GS/304/09/2022 book entry, receivable from Tan Cang - Ben Thanh Company for the dividend at the rate of 25% according to the Decree of the General Meeting of Shareholders 2022, accompanied by relevant documents such as: Information disclosure table on the portal of the State Securities Commission, and Minutes of the Annual General Meeting of Shareholders (Appendix 8):

Transaction 3: On December 21, 2022, receiving the dividend payment notice and Credit Notice of MB Bank on the payment of dividend by Cat Lai - Eastern Sai Gon JSC in 2021, the amount of 500.000.000 VND:

Relying on the Credit Note of MB Bank (Appendix 9), the accountant will compare with the dividend notice and the detailed accounting book of the depositing bank's account, to account in the software, the data will be automatically updated in the accounting book

Dr 112111 - Demand deposit at MB Bank: 500.000.000

Transaction 4: On December 28, 2022, receiving the detailed accounting book of the account, Interest slip and Credit Note No GBC/193/12/22 of ACB Bank on the payment of interest of the current account at ACB Bank, the amount of 305.021 VND:

Dr 11212 - Demand deposits at ACB Bank: 305.021

Transaction 5: On December 31, 2022, the accountant made a Debit Note No

GS/276/12/2022 to record interest on term deposit accounts at banks according to the summary table of term deposits at MB banks (Appendix 10):

Transaction 6: At the end of the accounting period, general accountants will carry out the closing entries to determine business results:

Cost accountant

3.2.1 Accounting for cost of goods sold

Diagram 3 6 Process of circulating cost of goods sold documents

Check unit price and output

Transfer acc 154 to acc 632 on Lemon accounting software

To complete the very large number of services that need to be provided every day and achieve high efficiency, in addition to the services performed by the Company itself, the Company also signs contracts with many partners who are subcontractors (called subcontractors) satellite company – to jointly perform services for the Parent Company as well as for other customers) Costs paid to satellite companies - Outsourced service costs account for about 30%-45% of the Company's total costs per period

At the end of each month, based on the summary table of service output confirmed by both parties and relevant documents, satellite companies will issue a VAT invoice and send it to the Company as a basis to record cost of goods sold through account 627 Account 627 is detailed for each type of service (for example: Account 62752: Cost of transportation, loading and unloading vehicles; Account 62770: Expenses Container loading and unloading fees at the yard; Account 627781: Port transfer service costs, etc.)

After that, the accountant synthesizes all production expenses including Direct materials expenses (Account 621), Direct labor cost (Account 622), Manufacturing overhead expenses (Account 627) and then gathers on Account 154 - Work in progress Later transfer all expenses from account 154 to account 632 - Cost of goods sold At the end of the period, the accountant will make a transfer entry on the software to determine the business results

The company uses account 632: Cost of goods sold

Transaction 1: On September 30, 2022, the accountant transferred the cost price in September 2022, voucher number GS/312/09/2022 (Appendix 18) After compiling the set of costing expenses for each service, the accountant will carry out the accounting and transfer of Work in progress to the Cost of goods sold on the software and printed the slip:

On September 30, 2022, the accountant made the closing entry of the Cost of

51 goods transfer in September 2022 with the entry voucher number GS/312/09/2022

Transaction 2: On October 31, 2022, the accountant transferred the cost price in October 2022, voucher number GS/300/10/2022 (Appendix 19) After compiling the set of costing expenses for each service, the accountant will carry out the accounting and transfer of Work in progress to the Cost of goods sold on the software and printed the slip:

On October 31, 2022, the accountant made the closing entry of the Cost of goods transfer in October 2022 with the entry voucher number GS/300/10/2022 (Appendix

Transaction 3: On November 30, 2022, the accountant transferred the cost price in November 2022, voucher number GS/299/11/2022 (Appendix 20) After compiling the set of costing expenses for each service, the accountant will carry out the accounting and transfer of Work in progress to the Cost of goods sold on the software and printed the slip:

On November 30, 2022, the accountant made the closing entry of the Cost of goods transfer in November 2022 with the entry voucher number GS/299/11/2022

Transaction 4: On December 31, 2022, the accountant transferred the cost price in December 2022, voucher number GS/356/12/2022 (Appendix 21) After compiling the set of costing expenses for each service, the accountant will carry out the

52 accounting and transfer of Work in progress to the Cost of goods sold on the software and printed the slip:

On December 31, 2022, the accountant made the journal entry for transfer of Cost of goods in December 2022 with the book entry voucher GS/356/12/2022

Transaction 5: At the end of 2022, the cost of goods sold transferred to determine the company's business results is:

The company's selling expenses are the cost of advertising commissions to rice terminals, the cost of service commissions paid directly to customers at rice terminals or shipping lines This expense is only recognized when it is certified by the Director and the Finance - Accounting department In addition, there are expenses related to stationery, printing for sales, etc

Diagram 3 7 Process of circulating documents of advertising expenses

After receiving the full set of documents, the Accountant checks and records the cost: Debit Acc 6415 (Advertising expenses, rice harbor commissions)/ Credit Acc

3318 (Payable to other sellers) When paying, the accountant makes a Payment voucher, which is signed and received by the Treasurer, the receiver, the Chief Accountant, and the Director: Debit Acc 3318 (Payable to other sellers)/ Credit Acc

The plan is approved by the

VAT invoice Request payment letter

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Diagram 3 8 Process of circulating vouchers of rice wharf commission

In the month when the customer pays for the rice closing service, the Business Department will make a proposal to encourage the customer to close the rice and send it to the Finance - Accounting department, at which time the accountant will make a Payment order with the Payment voucher, signed, and received by the maker, the Chief Accountant and the Director

The company uses account 641: Selling expenses, details for each expense item: Account 6415: Advertising expenses, rice harbor commissions

Account 6417: expenses of outsourcing services

Account used in relation to expenses:

Account 1331: Deductible VAT of goods or services

Account 3310: Payable to suppliers and service providers

Account 3311: Payable to suppliers for capital construction

Account 3312: Payable to suppliers for purchase of raw materials, supplies, repair of machinery and equipment

Account 3313: Payable to suppliers for purchase of fixed assets Account 3314: Payable to suppliers for repair of works

Account 3318: Other payables to suppliers

Transaction 1: On January 17, 2022, the accountant makes a credit note to pay the advertising money Bao Dau Tu with the entry voucher number GS/016/01/2022, according to VAT invoice No 01, enclosed with related documents including the Plan

Table recommendations to encourage customers to pack rice

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54 table, Decision tables, Statement, Appraisal report, Minutes of contract negotiation, Advertising contract, Product delivery slip and liquidation of contract (Appendix 23):

Transaction 2: On December 28, 2022, the accountant made a payment order with a payment voucher to pay the November 2022 rice commission for Bui Minh Tam, voucher number GBN/137/12/22, amount of 20.529.000 VND and attached Request for encouraging customers to pack rice, and Minute of agreement (Appendix

Cr 11212 - Demand deposits at ACB Bank: 20.529.000 The company will retain 10% personal income tax from the commissions that customers receive, so that at the end of each month the company will pay personal income tax to customers who receive rice commissions

Transaction 3: On December 31, 2022, the accounting accountant must pay

CMA-CGM Vietnam JSC the customer consulting fee at Depot Tan Cang - My Thuy with the registration document No GS/297/12/2022 according to VAT invoice No

4854 and VAT invoice No 4912, attached to the payment table of customer consulting fee (Appendix 25):

Transaction 4: On December 31, 2022, the accountant accounts for the payment of customer gift expenses according to VAT invoice No 2376, with the recording document GS/304/12/2022, attached to VAT invoice No 5344 and the Plan (Appendix

Transaction 5: On December 31, 2022, the accounting accountant must pay An

Binh Advertising Media Co., Ltd the fee for organizing customer conferences according to VAT invoice No 54, with the recording document No GS/352/12/2022, together with related documents including: Proposal, Plan table, Guest list, Estimated Quotation, Quotation for conference and party services, Service contract, Minutes of confirming the workload, Minutes of contract liquidation (Appendix 27):

Transaction 6: Transaction 6: At the end of 2022, transfer selling expenses to determine business results:

3.2.3 Accounting for general administration expenses

Income summary accountant

3.3.1.1 Content to evaluation of Income summary

At the end of the accounting period, the accountant will deduct depreciation of fixed assets, allocate expenses, inventory raw materials and cash funds, etc After that, the accountant will make the closing entries

At the end of each month, the general accountant will close the accounting books of the previous month to open the accounting books of the next accounting period On December 31, the general accountant will close the accounting books to make a report and determine business results

The financial statements are prepared on an accrual basis

Account 9111: Determination of business results

Account 9112: Determination of financial performance

Account 9113: Determination of Other performance

At the end of the accounting year, the accountant performs automatic revenue and expense transfer entries on the software to determine the business results in 2022

Transaction 1: Transfer of revenue to determine business results:

Transaction 2: expenses transfer to determine business results:

− Transferring cost of goods sold:

− Transferring general and administrative expenses:

− Transferring current income tax expenses:

After closing, accountants will make business results reports on the software in combination with excel based on:

Figure 3 2 Income Statements Source: Financial report for 2022 from Tan Cang Logistics

Chapter 3 describes the actual situation of accounting for revenue and expenses and determining business performance at Tan Cang Logistics And Stevedoring Joint Stock Company For each revenue and expense, there are relevant documents, the process of transferring documents, arising transactions, etc., and other documents used to determine business performance Through the analysis, the company’s business situation is relatively good, it is still possible to make a profit, but the costs are still high resulting in lower profits than in previous years The company must actively take measures to quickly remedy this situation to bring the company to the highest efficiency and operate more effectively This is the basis for comments and recommendations to improve the determining business performance accounting work at the company

REMARKS AND RECOMMENDATIONS

Basis for making remarks

To make comments, the author has relied on:

− Circular No 200/2014/TT-BTC issued by the Ministry of Finance on December 22, 2014

− The Vietnamese Accounting Standards (VAS) system is issued by the Ministry of Finance

− Charter - Regulation 2022 of Tan Cang Logistics And Stevedoring JSC.

Concluding remarks

− Accounting books are a place to summarize all economic transactions that have arisen, depending on the form of accounting used by enterprises, which will use the appropriate types of books In the company, the arising economic transactions are accounted for and reflected on Lemon accounting software through the general ledger and journal number All entry vouchers will be printed, signed, and approved by the Chief Accountant and saved with the original voucher to form a special, complete and convenient “Accounting Book”

− Thanks to the support of Lemon 3 accounting software, the bookkeeping of the accountant has been lighter, faster, and easier to check and track the responsibilities of each accountant Accountants only need to account for and accurately reflect economic operations on bookkeeping vouchers, the software will automatically update and synthesize the bookkeeping vouchers in a general ledger or journal This avoids errors in the process of recording and transferring books of manual accounting

− In general, during operation, the Company has used documents in a complete manner, in accordance with the prescribed form and reasonable rotation The way to store documents is also very scientific and logical through the arrangement in the right order and classification according to each type of document to be most convenient for search and lookup The process of approving documents is quite strict,

71 avoiding errors in recording arising economic transactions According to the specific requirements of the chief accountant: when making a Collection order - Payment order, the accountant shall make an additional Cash receipt - Payment voucher with the content reflecting the accounting account and the name of the person making the Collection order - Payment order so that the accountant can store it internally, avoid loss and conveniently monitor the number of documents on the relevant Collection order - Payment order

− The way to store each document file is very convenient for searching and looking up Each accountant has a dossier cover to store the vouchers in each accounting section that the accountant makes, clearly assigning each manager a certain number of vouchers; When it is necessary to get the type of voucher to look up, it is necessary to notify the accountant managing that voucher The accountant is also very careful in arranging the right vouchers according to the booklet name and serial number to save them properly and storing the booklet in the right area

− Each department, each type of service that the accountant undertakes has clear regulations on documents and the process of document rotation The accountant’s all check very closely on the types of documents In particular, the accountants also check once again the work of the production synthesis team of the Business - Planning department by accessing TTOS and CMS software to check if the output in the Production report is accurate

The Company's account system is very elaborate and detailed, serving quite well for tracking subjects with detailed accounts Some evidence can be given:

− Account 511 - Turnovers from sales and provisions of services, detailed into multiple accounts for detailed revenue tracking for each service activity and region + Account 51130: Turnovers from loading and unloading services at the yard

+ Account 511321: Turnovers from shipping services

+ Account 51133: Turnovers from services in Tan Cang - Nhon Trach area + Account 51136: Depot’s service turnovers

+ Account 511371: Turnovers from joint venture activities at Depot 6 - IMO + Account 511372: Turnovers from joint venture activities at Tan Cang - My Thuy

+ Account 511373: Turnovers from joint venture activities of Office Building + Account 51138: Turnovers from rental vehicles

− Account 642 - General administration expenses with expense accounts detailed up to level 5 for each activity

+ Account 64211: Expense for salary of managerial staff

+ Account 64212: Expense for social insurance, health insurance, unemployment insurance

+ Account 6423: Cost of office supplies

+ Account 6424: Depreciation expenses of fixed assets

+ Account 64270: Office electricity and water consumption expenses

+ Account 64271: Office supplies, printing, and newspaper expenses

+ Account 64274: Telephone, postal, courier charges

+ Account 64276: Expenses for registration and vehicle inspection

+ Account 64277: Expenses for legal and consulting services

+ Account 64278: Cost of repairing vehicles, management offices

+ Account 64281: Payment of per diem

+ Account 64282: Cost of professional training, coaching, recruitment + Account 64283: Expense for foreign transactions and reception

+ Account 64284: Expenses for military equipment and labor protection + Account 64285: Meal expenses

The system of detailed tracking accounts for each activity, good support for revenue - cost analysis to evaluate the effectiveness of activities; There are certain correspondences between the accounts to make accounting easier When an economic transaction arises, the fact that the accounts are detailed has helped the accountant determine which account’s value should be included in, thereby preventing confusion In addition, revenues, expenses, receivables, and payables reflect the true nature, avoiding the situation that many types of expenses, receivables, and payables are generally recognized in an unclear way

The company has mainly service activities of transportation and unloading, so there are no revenue deductions, so in the accounting system, it does not use account

521, so the indicator “Revenues from sales and service provisions” on the income statement, which is also “Net revenues from sales and service provisions”

Every month, drivers are rewarded or fined an amount corresponding to the gasoline/oil they have used compared to the fuel consumption norms set by the company This helps the company save fuel and avoid fuel fraud and adds a bonus to the driver's monthly salary

Every month, general accountants will close the books to ensure that the data in the month is not edited in the following months, then print out and store it as prescribed However, due to the characteristics of the work, the closing of books has not been done by regulations, and the printing of accounting books is also often delayed This must be overcome to avoid unintended modifications in the accounting books and to help the entire accounting process work properly and by the provisions of accounting law

− The Production report is often delayed, the production synthesis team often makes errors and mistakes in the process of preparing the Production report This causes the revenue recognition process to be slowed down accordingly Thus, although the workflow is quite logical, productivity is still reduced This problem also

74 shows that the system of providing information between departments has some limitations

− The reimbursement process does not accurately reflect that the cost is equal to the advance amount When the staff member receives an advance payment, the Treasurer makes a cash receipt for the entire amount of the advance, then makes a payment voucher to record the actual cost incurred based on the documents provided by the advance staff

− The Planning - Business department has not strictly managed the issuance and cancellation of VAT invoices, although this is the department responsible for managing and tracking all invoices, it does not know exactly how depots use invoices, how many invoices are canceled in the month, etc The irrationality is that at the end of the month, the accountant is the department that checks and prepares the Output invoice listing to submit to the Tax Department In fact, accountants often face difficulties in this stage

The management of the cost of goods sold is not good In 2021, the cost of goods sold was 956.134.002.384 VND, by 2022, the cost of goods sold was 1.096.142.256.914 VND, the company's cost of goods sold increased sharply by 14,64% compared to the previous year The increase in the cost of goods sold is partly due to the increase in service revenue, it can be seen that service revenue in 2021 was 1.153.230.883.922 VND, in 2022 was 1.319.352.930.810 VND, an increase of 14,40% compared to the previous year In addition, the company's high cost of goods sold is mainly due to objective reasons beyond the control of enterprises such as the increase in the inflation rate, the increase in input prices, and the increase in workers' wages due to the state's policies to increase the basic salary The high cost of goods sold leads to high service prices, reducing the competitiveness of services provided.

Recommendations

In the process of accounting for operations related to business management expenses, the accountant should detail the department used (such as Planning - Business department, Investment - Legal department, etc.) to facilitate the monitoring

75 and management of expenses to come up with cost reduction plans to maximize profits

− The production synthesis department needs to quickly complete the work in time to transfer the information to the Planning - Business Department in time Communication between departments and with the parent company must be strengthened so that the information about the output is synthesized quickly and conveniently for the next stages There should be stricter regulations on the time of submission of documents, regulations on responsibility for errors in the process of the Production team in the Planning - Business Department taking output from the software

− The Planning - Business Department should assign 1 employee A to be responsible for summarizing the data on the TTOS and CMS systems, thereby making a production summary table In the next stage, the Sales Department sends 1 employee B to check and review the Production report and related documents If the documents are correct, they will be submitted to the Manager of the Department for approval and then invoiced On the contrary, if there are errors, they must be checked and reviewed At the same time, employee B will be responsible for circulating invoices to the Finance - Accounting department through the signing and receipt on the voucher delivery book, and that employee will directly monitor the issuance and cancellation of invoices at the Depot If the document transfer time is over, this delay will be borne by the Sales Department

Flowchart 4 1 Flowchart of document transfer process

− The reimbursement process can be changed to make it simpler When reimbursement is desired, the staff to be reimbursed will prepare a Reimbursement confirmation form, which states:

+ Detailed list of documents confirming the payment (number, date, document name, content, amount)

+ Attached are as follows: original documents

All the above documents must be certified by the head of the department directly managing the advance staff before the Finance - Accounting Department receives these documents At this time, the accountant will make a cash receipt to recover the unused money, and account: Debit Account 6 / Credit Account 1412 (Internal

The cost of goods sold by the company accounts for a high proportion of 83,08% of the company's net revenue This rate is higher than other enterprises in the same industry when compared to Dinh Vu Port Investment and Development JSC (46,92%),

Da Nang Port JSC (61,39%), and Port of Hai Phong JSC (66,31%)

Table 4 1 Cost of goods sold ratio to Net revenue

Compile data on TTOS and CMS systems Prepare

Checking and reviewing the Production report

Allow the issuance of Invoices, sign for full approval

Rotation time (last day of the month) Disapprove

Be accountable invoice rotation Track invoice cancellations

Tan Cang Logistics And Stevedoring JSC

Dinh Vu Port Investment and Development JSC

Port of Hai Phong JSC

The company's inputs are mainly petroleum, labor, and equipment production expenses To reduce the cost of capital, the company should build a management system to control the cost of goods sold through the preparation of direct labor cost estimates, direct material expenses, general production expenses, so that the management can control the cost flexibly In addition, the increase in cost of capital is partly since domestic gasoline prices are always fluctuating erratically Therefore, the Company should determine a reasonable reserve of raw materials by building a system of warehouses for raw materials, fuels, and machinery and carry out the distribution of raw materials and fuels to the production department in a scientific manner based on the consumption norms developed by the Company Or the company can use other types of alternative energy to suit the scale of each type of service, such as converting some vehicles (forklifts, terminal tractors, etc.) using gasoline/oil to use electricity

For labor expenses, the company can review and restructure personnel by rearranging work to suit the capacity of everyone, completing the regulations on compensation in accordance with the actual situation and continuing to promote the labor productivity of ministries and employees As for the cost of equipment production and transportation, the company should expand to find suppliers to avoid being forced to price through the comparison of price lists of different suppliers

➢ Anticipated growth rate of service revenue in 2023 after applying the suggestions:

▪ Average growth rate of Net revenue in 2022

▪ Net revenue in 2023 = Net revenue in 2022 * (1 + % Average growth rate of

Through the above calculation, the company's expected net revenue in 2023 will reach about 1.457 billion VND, an increase of nearly 10,42% compared to 2022 Assuming the cost of goods sold in 2023 will be 1.195 billion VND (accounting for 82% of the net revenue in 2023) In particular, the percentage of all types of expenses (Material cost, Labor cost, Fixed asset depreciation cost, External service cost, and Other expenses) is calculated by taking the cost of each type division for cost of goods sold based on data in the notes to the financial statements for 2022

Figure 4 1 Cost of services provided

Source: Financial report for 2022 from Tan Cang Logistics Table 4 2 Estimated cost of goods sold in 2023

Fixed assets depreciation 25.252.307.147 2,30% 27.521.229.683 2,30% Outside services 930.594.448.283 84,90% 1.014.208.460.402 84,90%

➢ Anticipated growth rate of profit after tax in 2023 upon proposal implementation:

The company's profit after tax in 2022 is 124.510.971.392 VND, net income will also be 124.510.971.392 VND Based on the Minutes of the 2023 Annual General Meeting of Shareholders, the dividend distributed to shareholders is 67.278.359.046 VND

Rely on the formula, calculates the following criteria:

▪ Retained earnings in 2022 = Beginning period retained earnings + Net income

▪ Roe 2022 = Profit after tax in 2022

▪ Growth Rate in 2022 = Retention ratio in 2022 * ROE2022

▪ Expected profit after tax in 2023 = Profit after tax in 2022 * (1 + % Growth rate in 2022)

Table 4 4 Expected growth rate in 2023

The company's expected profit after tax in 2023 is 138.759.339.326 VND, corresponding to net income will also be 138.759.339.326 VND Suppose the

81 dividend distributed to shareholders in 2023 will be equal to 2022, which is 67.278.359.046 VND

Rely on the formula, calculates the following criteria:

▪ Retained earnings in 2023= Beginning period retained earnings + Net income

▪ Average growth rate of equity in 2022

Equity in 2023 = Equity in 2022 * (1+ % Average Growth Rate of Equity in 2022)

▪ Roe 2023 = Profit after tax in 2023

▪ Growth Rate in 2023 = Retention ratio in 2023 * ROE2023

Conditional on (Table 4.3) and (Table 4.4), the expected retained earnings in

2023 increased sharply compared to 2022 (up 20,17%) The increase in retained earnings in 2023 compared to 2022 will give the Company resources to use for the investment in business expansion and other business activities of the unit In addition, when the Retention ratio of 2023 (51,51%) compared to 2022 (47,77%) increased to 3,74%, it shows that the Retention ratio still accounts for a relatively high proportion of after-tax profits

Through the above analysis and evaluation, it can be seen that the Company is planning to focus capital and retain many profits on expanding business activities in the logistics centers of the southern key economic zone (Binh Duong, Dong Nai, Ba Ria - Vung Tau, etc.), continue to promote investment in projects of the core capacity of the enterprise such as port exploitation, warehousing and ancillary services for port exploitation activities

Facing the increasingly fierce competition of companies in the same industry in the exploitation of depot, transportation services, logistics, warehousing services, etc, along with economic, political instability, epidemics, and natural disasters in the world, it will profoundly affect Vietnam's economy The Company needs to quickly grasp the trends and requirements of the market, invest in time, and anticipate the market demands to sustainably develop key service industries with the Company's strengths At the same time, the company should constantly improve service quality and operating capacity in existing areas; increase customer connection to increase output; actively monitor and coordinate with functional departments to market new customers to use the company's services

Based on fact, this chapter has analyzed and evaluated the strengths and weaknesses of the accounting system at the company Through extensive research and analysis of the company's finances, the author has discovered and analyzed the advantages for the company to continue and promote, in the other hand overcome the shortcomings From there, several recommendations are proposed to improve the accounting of revenue and expenses and determine business performance All have been proposed and recommended through this chapter 4

Through the internship at Tan Cang Logistics and Stevedoring Joint Stock Company, the author had the opportunity to learn about the history of the company's development as well as its organizational structure At the same time, the author has systematized the theoretical basis of revenue and expense accounting and determined business results, to have an overview of the actual accounting work During the internship at the company, the author has a better understanding of what the work of an accountant will include, through how to circulate vouchers in the enterprise; how to arrange and store vouchers; how to solve transactions arising at the enterprise; recording revenue, expenses and accounting operations made before the transfer, closing the book to determine business results for an accounting period in practice Through the synthesis and analysis, in general, in 2022, the company was still on the path of good development, profit after tax in 2022 increased by 11,68% compared to 2021 The accounting work at the company complies with accounting standards and regimes as prescribed by the state The arising economic transactions are handled in accordance with the order and process, the system of accounts at the enterprise is monitored very specifically and in detail according to each object and item However, there are still some limitations that need to be overcome, so the author has made a few recommendations that can help the accounting work at the company be more complete

That is extremely vital for myself, I also understand the importance of accounting in general and accounting to determine business results in particular for the development of the company Accountants who determine business results will provide data and statistics to the Board of Directors to decide appropriately to foster the company Despite trying to apply the knowledge learned at university and the help of colleagues in the company, but because of the limited knowledge and experience, the article cannot avoid errors The author hopes that you can give suggestions and recommendations so that the author can gain more knowledge and experience for myself