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State Audit Reveals Major Investment and Accounting Flaws at MB and PVI
🇻🇳 Vietnam /Economy & Trade

State Audit Reveals Major Investment and Accounting Flaws at MB and PVI

From Thanh Niên · (6d ago) Vietnamese Critical tone

Translated from Vietnamese, summarized and contextualized by DistantNews.

TLDR

  • Vietnam's State Audit Office has reported significant issues in the financial operations of MB and PVI, two major financial institutions.
  • The audit revealed numerous ineffective or low-yield investments, with hundreds of billions of dong potentially unrecoverable.
  • Both MB and PVI are noted to have had issues with accounting accuracy, including misstated revenues and expenses.

A recent report from the State Audit Office of Vietnam has cast a shadow over the performance of two prominent financial entities, MB and PVI, revealing substantial financial irregularities and questionable investment practices. While both institutions reported profits and met safety standards, the audit uncovered a concerning pattern of ineffective investments and accounting discrepancies that raise serious questions about their financial management.

The audit results show that the audited financial organizations, banks, and insurance companies basically ensure safety indicators in operations and profitable business.

— State Audit Office of VietnamAcknowledging the overall profitability and safety of the audited institutions.

The audit highlighted that PVI, in particular, has made numerous investments that are either yielding poor returns or have become essentially worthless. These include significant amounts in stocks of the Bank for Foreign Trade of Vietnam (DongA Bank) which have been written off, and substantial investments in bonds and deposits with entities like Song Da Thang Long and Oceanbank, where recovery prospects appear dim. The report also points to PVI's inaccurate accounting of insurance revenue and improper reductions in premiums, indicating a lack of diligence and adherence to regulations.

However, the audit authority also pointed out many existing problems and limitations in the operations of these two units.

— State Audit Office of VietnamIntroducing the negative findings of the audit.

Similarly, MB is facing scrutiny for its investment portfolio, with several unlisted stock investments totaling billions of dong showing poor performance or lack of transparency. The audit also identified issues with MB's accounting of accrued interest, guarantee fees, and payment service fees, as well as improper accounting for employee medical expenses. Furthermore, MB's classification of non-performing loans was found to be inconsistent with regulations, potentially masking the true extent of its financial risks. These findings by the State Audit Office underscore a critical need for enhanced oversight and stricter financial discipline within Vietnam's banking and insurance sectors.

Hundreds of billions of dong in investments 'whose recovery date is unknown' at Bao Minh PVI.

— Thanh NiênHighlighting a specific concern regarding PVI's investments.
DistantNews Editorial

Originally published by Thanh Niên in Vietnamese. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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