Principles for Preparing and Presenting Financial Statements when Changing the Accounting Period from Jan 01, 2026

The Principles for preparing and presenting financial statements when changing the accounting period are specifically regulated in Circular 99/2025/TT-BTC and officially applied from January 01, 2026. Compliance with these regulations helps enterprises minimize risks and facilitates tax settlement and auditing. This article summarizes the current regulations and provides specific instructions.

Regulations regarding changes to the accounting period

Based on Clause 14, Article 3 of the Law on Accounting 2015 (amended and supplemented in 2024), an accounting period is the determined time from the start of recording accounting books to the closing of books to prepare financial statements.

According to Point a, Clause 1, Article 12, the annual accounting period is 12 months (Jan 01 to Dec 31). However, entities with specific organizational or operational characteristics may choose a different annual accounting period:

• A full 12-month period according to the calendar year.
• Starting from the first day of the first month of a quarter to the last day of the last month of the previous quarter in the following year (e.g., April 01 of this year to March 31 of the next year).

Note: The selection or change of the annual accounting period must be notified to the finance and tax authorities to synchronize data.

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Principles for preparing and presenting financial statements when changing the accounting period from January 1, 2026.

When converting the accounting period from Jan 01, 2026, enterprises must adhere to the principles in Article 21 of Circular 99/2025/TT-BTC. Specifically, enterprises must prepare a separate set of Financial Statements for the transitional period between the two accounting periods of the old and new fiscal years.

For the Statement of Financial Position

Based on Clause 2, Article 21, Circular 99/2025/TT-BTC:

• The entire balance of assets, liabilities, and owner’s equity at the end of the accounting period before the conversion is recorded as the opening balance of the new accounting period.
• This is presented in the “Beginning of year” column.

For the Statement of Income and Statement of Cash Flows

For the period from the end of the old accounting period to the time of changing the accounting period:

• “Current period” column: Presents data from the end of the old accounting period to the time of the change (the transitional period).
• “Previous period” column: Presents corresponding data from the previous accounting period OR data of the 12 months of the immediately preceding fiscal year.

Explanatory notes to financial statements when changing the accounting period

Notes to Financial Statements explain material changes in accounting policies and periods. Based on Clause 4, Article 21, Circular 99/2025/TT-BTC, enterprises must clearly disclose:

• The reason for changing the annual accounting period end date.
• Corresponding figures for comparison presented in the Statement of Income, Statement of Cash Flows, and related Notes.
• Non-comparability: If the “Previous period” figures are for 12 months while the “Current period” (transitional) figures are shorter, the enterprise must disclose the lack of comparability between the reporting period and the comparative period according to Vietnam Accounting Standard (VAS) No. 21 – Presentation of Financial Statements.

Frequently Asked Questions

Below, Long Phan Consulting provides some frequently asked questions related to the transition of accounting periods and the preparation of financial statements according to the new regulations. We invite interested clients to refer to the following information:

Is a separate Financial Statement required for the transitional period from Jan 01, 2026?

Yes. It is mandatory. When changing the annual accounting period, the enterprise must prepare a separate set of Financial Statements for the period between the two accounting periods of the old and new fiscal years to ensure data continuity. (Legal Basis: Clause 1, Article 21, Circular 99/2025/TT-BTC).

To which agency must the change be notified?

Enterprises must notify the finance authority and the direct managing tax authority. This ensures synchronization of management data and tax obligations. (Legal Basis: Point a, Clause 1, Article 12, Law on Accounting 2015, amended 2024).

How is the opening balance of the new period determined?

The opening balance of the new period is the entire closing balance of assets, liabilities, and owner’s equity at the end of the accounting period before conversion. (Legal Basis: Clause 2, Article 21, Circular 99/2025/TT-BTC).

Where is the opening balance presented on the Statement of Financial Position?

It is presented in the “Beginning of year” column of the new accounting period’s Statement of Financial Position (the transitional period). (Legal Basis: Clause 2, Article 21, Circular 99/2025/TT-BTC).

What if the “Previous period” is 12 months but the “Current period” is shorter?

The enterprise must disclose the non-comparability of the information between the reporting period and the comparative period in the Notes to Financial Statements, in accordance with VAS 21. (Legal Basis: Point b, Clause 4, Article 21, Circular 99/2025/TT-BTC).

Conclusion

Strict adherence to the Principles for preparing and presenting financial statements when changing the accounting period ensures transparency and legal compliance. To ensure your business interests and schedule, please contact Long Phan Consulting Company via Hotline 1900636389 for timely and professional legal support.