The preparation and analysis of financial statements in DUYENHAI Trading and Manufacturer, Ltd

i

MINISTRY OF FINANCE
ACADEMY OF FINANCE

Student:

Lương Thanh Tùng

Class:

CQ54/21CL.02

Topic: “The preparation and analysis of financial statements in
DUYENHAI Trading and Manufacturer, Ltd”

GRADUATION THESIS
Major:

Business Accounting

Supervisor: MSc . Nguyễn Bá Linh

HÀ NỘI, Year 2020

Lương Thanh Tùng – CQ54/21CL.02


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LETTER OF DECLARATION

I hereby declare that this thesis the results of my own research and
has never been published in any work of others. During the process of making
this thesis, I have seriously taken research ethics; all findings of this project
are results of my own research and surveys; all references in this project are
clearly cited according to regulations.
I bear full responsibility to the fidelity of the number and data and
other contents of my work.

Hanoi,(day)… … (month)… … … (year) 20…..
Student
(Signature and Full name)

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ACKNOWLEDGEMENT
Firstly, I am deeply indebted to my supervisor MSc. Nguyen Ba Linh
whose help, stimulating suggestions and encouragement helped me all the
time of research for and writing of this thesis.
I also want to thank Duyehai Trading and Manufacturer, Ltd for giving
me permission to commence this thesis in the first instance, to do the
necessary research work and to use departmental data.
I have furthermore to thank the Vice Director and Chief Accountant as
well as all seniors at Duyenhai Trading and Manufacturer, Ltd who gave and
confirmed this permission and encourage me to go ahead with my thesis.
Friends from Accounting Faculty also supported me in my thesis; I want
to thank them for all their support, interest and valuable conversations.

Especially, I would like to give my special thanks to my family whose
patient love enabled me to complete this work.
Finally, because of limitation of time and knowledge, mistakes are
unuavoidable, so I wish to have more opportunities. I also wish to receive
more contribution and suggestions to make my thesis better.

Lương Thanh Tùng – CQ54/21CL.02


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ABSTRACT
In the modern economic, Viet Nam business organizations face not only
opportunities but also great chanllenges. In order to catch up with the progress
and avoid being “eliminated”, all organizations are expected to always
perfecting and developing their managing system, especially on the aspect of
accounting, for having a good accounting system plays an important role in
making decisions and policies. If by any chance a certain item on the reports
(including balance sheet, cash flow statement, income statement) was
mispresented, any decisions based on that result may become unsuitable,
which will lead to failure. Therefore, my thesis with the topic “The
preparation and analysis of financial statements in Duyenhai Trading and
Manufacturer, Ltd” will point out the importance of financial statements,
components of financial statements and analysis of financial statements.
The main content is reflected in three chapters. The first chapter is about
the general theory of financial statements preparation and analysis in
enterprises. In chapter 2, by taking a scenario in Duyenhai Trading and
Manufacturer, Ltd, the thesis focuses on a real practice of preparing and
analyzing their financial statements. From that, chapter 3 points out some of
company’s strength and weaknesses and suggests some solutions to improve

the preparation and analysis of company’s financial statements.
In conclusion, the thesis has already been complete in comparison wiith
proposed objectives and targets in the introduction.

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LIST OF DIAGRAMS
No.
2.1

2.2

Content of diagram
Management mechanism in Duyenhai Trading and
Manufacturer Company, Ltd
Accounting system in Duyenhai Trading and Manufacturer
Company, Ltd

Pages
70

72

LIST OF TABLES
No.

Content of table

Pages

2.1

Main indicators reflects business results of the company

68

in 2019
2.2

Main indicators reflects financial position of the

69

company in 2019
2.3

Analysis of business results of the company in 2019

83

2.4

Overall assessment of company’s performance

85

2.5

Company’s financial structure

87

2.6

The asssets structure of the Company

89

2.7

Overview of company’s liquidity

91

2.8

Overall assessment of company’s debt ratio

93

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TABLE OF CONTENT
PREFACE..................................................................................................................................1
Sincerely thanks!........................................................................................................................3

CHAPTER I...............................................................................................................................4
GENERAL THEORY OF FINANCIAL STATEMENTS PREPARATION AND ANALYSIS
IN ENTERPRISES...................................................................................................................4
1.1. General overview of financial statements and financial statements analysis in
enterprises.....................................................................................................................................4
1.1.1. The basics of financial statements..................................................................................4
1.1.1.1. Financial accounting information................................................................................4
Accounting is the process of identifying, measuring, and communicating economic
information to permit informed judments and decisions by the users of the information, as
defined by The American Accounting Association. This information is primalily
financial−stated in money terms. Accounting, then, is a measuring and communicating tool
used to reflect on the activities of profit−seeking business organizations and not−for−profit
organizations. As measurement and communication process for business, accounting supplies
information that permits informed judments and decisions by users of the data........................4
Accounting information is the information that arises from business transactions. Once
identified, the information is then classified and recorded, and it eventually finds its way into
various reports..........................................................................................................................4
The process of providing information....................................................................................4
1) Identify stakeholders (users of accounting information): usually, the users of accounting
information are divided into two factions:.................................................................................4


Internal users: includes owners, managers, employees......................................................4



External users: includes customers, creditors, government................................................4

2) Assess stakeholders’s informational needs: each kind of user has a different motives and
objectives, therefore holds different needs of accounting information......................................4


Owners: need to assess how well their business is performing. They are also interested in
knowing how risky their business is and can be........................................................................5


Managers: need accounting information to plan, monitor and make business decisions....5


Employees: need accounting information to get a better understanding of the company’s
business, so that they may have proper plans for future development.......................................5

Investors: need accounting information to know how well their investment is performing,
therefore decide should they keep investing or stop..................................................................5

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
Lendors: need accounting information to assess their credit worthiness, their ability to
pay back loan.............................................................................................................................5

Suppliers: need accounting information to assess the credit-worthiness of its customers
before offering goods and services on credit.............................................................................5

Tax Authorities: need accounting information of suppliers and consumers in order to
identify potential tax evaders. Occasionally, tax authorities conduct audits of the tax returns
filed by businesses in order to verify the information with the underlying accounting records. 5
3) Design the accounting information system to meet stakeholders’s needs..............................5
An accounting information system (AIS) is a structure that a business uses to collect, store,

manage, process, retrieve and report its financial data so it can be used by accountants,
consultants, business analysts, managers, chief financial officers (CFOs), auditors,
regulators, and tax agencies......................................................................................................5
4) Record economic data about business activities and events..................................................5
5) Prepare accounting report for stakeholders...........................................................................5
1.1.1.2. Definition and objectives of financial reporting...........................................................6
a)

Definition..........................................................................................................................6

Financial reporting is the financial results of an organization that are released to its
stakeholders and the public. This reporting is a key function of the controller, who may be
assisted by the investor relations officer if an organization is publicly held. Financial reporting
typically encompasses the following documents and postings:.................................................6

Financial statements, which include the income statement, balance sheet, and statement
of cash flows.............................................................................................................................6

Accompanying footnote disclosures, which include more detail on certain topics, as
prescribed by the relevant accounting framework.....................................................................6


Any financial information that the company chooses to post about itself on its website. . .6



Annual reports issued to shareholders...............................................................................6


Any prospectus issued to potential investors concerning the issuance of securities by the

organization...............................................................................................................................6
Financial statements are written records that convey the business activities and the financial
performance of a company. Financial statements are often audited by government agencies,
accountants, firms, etc. to ensure accuracy and for tax, financing, or investing purposes........6
b)

Objectives.........................................................................................................................6


Financial reportings provide information about the reporting entity that is useful to
existing and potential investors, lendors and other creditors in making decisions about
providing resources to the entity................................................................................................6

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
The information provided about financial performance helps existing and potential
investors, lenders and other creditors to understand the return the entity has produced on its
economic resources...................................................................................................................7
 Decisions by invetors are about buying, selling or holding euity and debt instruments
depend on the returns that they expect from an investment in those instruments, eg dividends,
principal and interest payments or market price increase..........................................................7
 Decisions by ledors are about providing or selling loans and other forms of credit depend
on the principal and interest payments of other returns that they expect...................................7

The information must reflect the effect on performance of changes in market prices
and/or interest rates...................................................................................................................7
1.1.1.3. Requirements of financial statements presentation.......................................................7

According to Article 101 of circular 200/2014/TT-BTC about “Requirements for information
presented in financial statements”, the following are requirements for information presented in
financial statements:..................................................................................................................7
1. Information presented in the financial statements must be recorded honestly and reasonably
the financial situation, trading situation and income of enterprises. To ensure honesty, the
information must be complete, objective, unmistaken...............................................................7
- Information is only complete when including all the necessary information to help users of
financial statements to understand the nature, forms and risks of transactions and events. For
some items, the full presentation must also describe more information about the quality, the
factors and circumstances that may affect the quality and nature of the items...........................7
- Objective presentation is unbiased selection or description on financial information.
Objective presentation must ensure neutrality which do not focus, emphasis or reduce as well
as perform other acts to alter the impact of the financial information to become beneficial or
unbeneficial for users of financial statements............................................................................8
- No errors mean no omissions in the description of the phenomenon and no errors in the
process of providing reporting information selected and applied. No errors do not mean
complete accuracy in all respects, for example, estimating unobservable cost and value is
difficult to determine to be correct or incorrect. The presentation of an estimate is considered
to be honest, if the estimated value is described clearly, and the nature and limitation of the
estimating process is explained and there is no error in the selection of appropriate figures in
the estimate................................................................................................................................8
2. Financial information must be appropriate to help users of financial statements to predict,
analyze and make economic decisions......................................................................................8
3. Financial information must be presented fully in all important respects. Information is
considered to be important in case information is not sufficient or inaccurate information may
affect the decisions of users of financial information of the reporting unit. Materiality shall be
based on the nature and magnitude, or both, of the relevant items presented in the financial
statements of a particular unit....................................................................................................8
4. Information must be verifiable, timely and understandable...................................................8

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5. Financial information must be presented consistently and must be comparable among the
accounting periods and enterprises............................................................................................8
1.1.2. Types of financial statements.........................................................................................8
1.1.2.1. Balance sheet................................................................................................................8
* Definition of balance sheet...................................................................................................9
Balance sheet is a statement of the assets, liabilities, and capital of a business or other
organization at a particular point in time, detailing the balance of income and expenditure
over the preceding period..........................................................................................................9
* Nature and purpose of balance sheet..................................................................................9

The purpose of the balance is to set out the financial position of a business at a particular
point in time..............................................................................................................................9

It gives a snap shot of the assets, liabilities and equity position of the entity at a particular
point in time..............................................................................................................................9


It sets out the assets of the entity on the one hand, and the claims against it on the other..9

* Format of balance sheet.......................................................................................................9
There are two formats of presenting assets, liabilities and owners’ equity in the balance sheet
– account format and report format. In account format, the balance sheet is divided into left
and right sides like a T account. The assets are listed on the left hand side whereas both
liabilities and owners’ equity are listed on the right hand side of the balance sheet. If all the
elements of the balance sheet are correctly listed, the total of asset side (i.e., left side) must be
equal to the total of liabilities and owners’ equity side (i.e., right side).....................................9

.......10

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Picture 1: Example of account format.....................................................................................10
The report format (vertical format) is used more frequently. In vertical format, the balance
sheet elements are presented vertically i.e., assets section is presented at the top and liabilities
and owners equity sections are presented below the assets section..........................................10
BALANCE SHEET

As at 31 December 2019
Unit: VND
ASSETS

Codes

A - CURRENT ASSETS

100

I. Cash and cash equivalents

110

1. Cash

111

II. Short-term receivables

Notes

4

Closing balance

Opening balance

2,690,917,843

3,664,521,286

1,012,242,498

978,675,637

1,012,242,498

978,675,637

130

137,502,696

1,525,113,700

1. Short-term trade receivables

131

137,502,696

33,004,453

2. Short-term loan receivables

135

-

1,350,000,000

3. Other short-term receivables

136

-

142,109,247

III. Inventories

140

575,873,906

494,591,731

5

1. Inventories

141

575,873,906

494,591,731

IV. Other short-term assets

150

965,298,743

666,140,218

2. Value added tax deductibles

152

965,298,743

666,140,218

B. NON-CURRENT ASSETS

200

7,665,712,732

6,904,337,220

I. Fixed assets

220

7,385,419,635

6,258,944,559

1. Tangible fixed assets

221

7,385,419,635

6,258,944,559

- Cost

6

222

16,449,101,428

14,572,436,428

- Accumulated depreciation
5. Held-to-maturity investments
II. Other long-term assets

223
255
260

(9,063,681,793)
280,293,097

(8,313,491,869)
645,392,661

1. Long-term prepayments

261

280,293,097

645,392,661

TOTAL ASSETS (270=100+200)

270

10,356,630,575

10,568,858,506

................................................................................................................................................11

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................................................................................................................................................11
1.1.2.4. Financial statement footnotes........................................................................................20
* Definition..................................................................................................................................20
Financial statement footnotes are explanatory and supplemental notes that accompany a
firm’s financial statements. The exact nature of these footnotes varies, depending upon the
accounting framework used to construct the financial statements (such as GAAP or IFRS). 20
* Purpose of financial statement footnotes...............................................................................20


Refer to additional information provided in a company’s financial statements..........20



Describe the items that are left out of the balance sheet and income statement...........20



Helps to clarify they would cloud the data reported in the financial statements.........20


May also include information regarding future activities that are anticipated to have a
notable impact on the business or its activities........................................................................20

* Format of financial statements footnotes..............................................................................20
Notes to the financial statements of a company are shown in three groups:........................20


Structural............................................................................................................................20



Adopted principles..............................................................................................................20



Other related affairs...........................................................................................................20

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Structural....................................................................................................................................20
1.

How far the accounting standard has been adopted.......................................................20

2.

The followed principles of accounting and measuring methods....................................20

3.

The helping information of the accounting items presented in financial statements...21

4. Other matters such as contingent liabilities, detailed disclosure of financial and nonfinancial matters.........................................................................................................................21
Preparation of adopted principles of accounting.....................................................................21
1.

The basis of preparation of financial statements.............................................................21

2. The accounting principles adopted in the preparation of financial statements. Besides,
for their easy understanding the information regarding who has used and analyzed the
methods which have been adopted in measuring money with its historical cost, current
cost, realization cost or present cost should be stated in detail. Besides, methods adopted in
case of;.........................................................................................................................................21


earning a profit...................................................................................................................21



the merger of business........................................................................................................21



the joint venture..................................................................................................................21



depreciation or write off of assets.....................................................................................21



loan.......................................................................................................................................21



contract of construction.....................................................................................................21



investment............................................................................................................................21



financial documents............................................................................................................21



research and development cost..........................................................................................21



inventory..............................................................................................................................21



income tax............................................................................................................................21



reserve..................................................................................................................................21



employee’s benefit expense................................................................................................21



foreign exchange.................................................................................................................21



business and geographical affairs.....................................................................................22



cash and cash equivalent....................................................................................................22

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

overvaluation.......................................................................................................................22



government contribution...................................................................................................22



the lease is to be taken into consideration........................................................................22

Other matters..............................................................................................................................22
In preparation of financial statements the business organizations will also have to mention
the following matters if not stated otherwise:..........................................................................22
1. Size of company, legal entity, its structure, registration, address and any other place
where business is run or registered...........................................................................................22
2. Business activities of the company and detailed, information regarding expansion of
the business..................................................................................................................................22
3. Source of the company, source of the entire group of companies, information
regarding the company..............................................................................................................22
4.

Some employees in a year or a particular period............................................................22

1.1.3. The basics of financial statement analysis.......................................................................22
* Definition of financial statements analysis:......................................................................22
Financial statement analysis (or financial analysis) is the process of reviewing and analyzing
a company's financial statements to make better economic decisions to earn income in future.
These statements include the income statement, balance sheet, statement of cash flows, notes
to accounts and a statement of changes in equity (if applicable). Financial statement analysis
is a method or process involving specific techniques for evaluating risks, performance,
financial health, and future prospects of an organization.......................................................22
* Purpose of financial statements analysis:.........................................................................22
In an open economy, businesses that want to survive and develop must always backing−up
their financial potentials and constantly improve their competitiveness. Through the
calculation and assestment of financial ratios, financial analysis helps users to have control
over all business activities informations, and know the position of the company in the market.
In the field of business, there must be an honest view of the financial situation of the
enterprise as well as its development potential, clearly determining the cause and level of

indicators affecting the financial situation. From that, we can take advantage of business
opportunities and make appropriate financial decisions to maintain and develop the business
operation. Therefore, financial statements analysis is the concern of many different subjects
such as: Board of Directors, investors, shareholders, creditors, customers, managers, even
employees themselves. Each subject has a different need from the financial statements, uses
the indicators and information obtained to make different decisions.......................................23
Financial statements analysis to business’s owner..............................................................23
To business’s owner, financial statements analysis has purposes as follow:...........................23

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− Create regular cycles to evaluate management activities in the past period, the
implementation of financial balance, profitability, solvency and financial risks during
operation..................................................................................................................................23
− Guiding the decisions of the Board of Directors in the appropriate direction to the current
situation of the company, such as decisions on investment, financing, profit distribution.......23
− Financial statements analysis is the base for financial forecasting.......................................23
− Financial statements analysis is a tool for company’s internal control, management...........23
* Financial statements analysis to investors........................................................................24
Financial statements analysis helps the investors evaluate the company’s operation through
researching financial reports, profitability, risks…..................................................................24
Financial statements analysis to the company’s creditors..................................................24
Financial statements analysis for creditors is essential in order to determine clearly the
financial status of customers: asset value, debt situation, ability to repay. Forecasting on the
financial status of customers in the future, forecasting on possible risks affecting customers'
ability to repay debts...............................................................................................................24
Financial statements analysis to company’s employees......................................................24
Financial analysis helps workers stay on their stable jobs. From that belief, they will be able to

to focus on the production of the company depending on the work assigned to them.............24
Financial statements to Government’s management agencies...........................................24
Government’s management agencies use the financial statements sent by enterprises to
analyze the financial situation of enterprises to check and monitor the business situation of
enterprises, thereby helping enterprises. The agency sets out policies, managing mechanisms
and financial solutions suitable to the actual situation of the enterprise, creating a favorable
legal corridor environment, contributing to helping businesses improve production efficiency.
................................................................................................................................................24
The above issues have shown that analyzing the financial situation of enterprises is very
necessary, an indispensable tool for businesses in a market economy..................................24
1.2. Financial statements preparation inenterprises...............................................................24
1.2.1. Statement of financial position (balance sheet) preparation...........................................24
Guidance for financial position preparation is stated in article 112 of Circular
200/2014/TT−BTC.......................................................................................................................24
1.2.1.1. Basis for preparation of the Balance Sheet...................................................................25
The information which is used in preparation of the balance sheet was based on:.............25
− The general accounting books;...............................................................................................25
− Detailed accounting books, cards on detailed summary sheet;...........................................25

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− The balance sheet of previous accounting year (to present the first column)....................25
1.2.1.2. Content and methods of setting up items in balance sheet of enterprises to meet the
assumption of continuous operation (Form B01-DN)...............................................................25
− “Opening Balance” column: Based on the closing balance column of the previous year
balance sheet to fill in the items, the column does’s change during the period....................25
− “Closing Balance” column: Based on the closing balance of the detailed accounts at year
end declaration. The items will be recorded as follow:...........................................................25



Debit balance of account will be recorded in to corresponding assets section..............25



Credit balance of account will be recorded into corresponding equity section............25

− In case of items which are related to many other accounts, the ending balancec of
relevant accounts will be collected to record............................................................................25
− Accounts such as 129, 139, 159, 214, 229, in which has ending balance, will be record in
negative value with form (− value) in the corresponding items in assets section.................25
− Accounts such as 412, 413, 421, if ever record in equity section, the debit balance will still
be recorded in the equity section, but in negative value with form (−value)........................25
− Debit balance and credit balance in “Trade receivables””, as well as debit balance and
credit balance in “Trade payables” can not offset each other................................................26
1.2.2. Income statement preparation...........................................................................................26
1.2.2.1. Basis for preparation of the income statement...........................................................26
The preparation of cash flow statement is based on:..............................................................26
- Based on income statement of previous year.........................................................................26
- Based on general accounting books and detailed accounting books in period used for
accounts from 5 to 9....................................................................................................................26
1.2.2.2. Contents and methods of preparation of item in income statement (Form B02-DN)..26
The determination of the number of common shares that shall be issued in period shall be
complied with the provisions of Accounting Standards, "Earnings per Share"..................33
1.2.3. Cash flow statement preparation.......................................................................................33
1.2.3.1. Basis for preparation of cash flow statement................................................................33
The preparation of cash flow statement is based on:..............................................................33
- The Balance sheet;....................................................................................................................33

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- The income statement;.............................................................................................................33
- The notes to the financial statements;....................................................................................33
- The cash flow statement of previous period;.........................................................................33
- The other accounting documents, such as: General accounting books, detailed accounting
books of accounts "Cash", "Cash in bank", "Cash in transit"; General accounting books
and detailed accounting books of the relevant accounts, spreadsheets and allocation of
depreciation of fixed assets and other detailed accounting documents.................................33
1.2.3.2. Content and methods of preparation of items in cash flow statement (Form B03-DN)
......................................................................................................................................................34
1.3. Financial statements analysis in enterprises.....................................................................52
1.3.1. Documents and methodolody for financial statements analysis..................................52
1.3.1.1. Documents for analysis...............................................................................................52
The company’s accounting information required for financial statements analysis includes:
informations on financial reports, detailed accounts, statistical documents, strategic plans and
business development strategies, namely:...............................................................................52
- Balance sheet B01 - DN........................................................................................................52
- Income statement B02 - DN..................................................................................................52
- Cash flow statement B03 - DN..............................................................................................53
- Financial statement footnote B09 - DN.................................................................................53
CHAPTER 2.............................................................................................................................64
PRACTICAL SITUATION OF FINANCIAL STATEMENTS PREPARATION AND ANALYSIS
AT DUYENHAI......................................................................................................................64
TRANDING AND MANUFACTURER, LTD.......................................................................64
2.1. Overview of Duyenhai Trading and Manufacturer, Ltd.................................................64
2.1.1. Foundation and development of the company............................................................64
2.1.2. Characteristics of business operation...........................................................................65

2.1.2.1. Main business sector..................................................................................................65
CFS warehouse (container freight station): is a warehouse location licensed by Customs to
certify the exploitation and delivery of import and export goods sent by containers. CFS
warehouse service provides customers with convenience and reduces the cost of sea freight
but still ensures the safety of goods due to strict storage regulations for goods in the
warehouse. Customers are supported on time to complete procedures and production troughs /
shifts always meet workers and equipment, facilities to serve customers for quick pick-up and
delivery. The company pays special attention to improving the customs formalities,

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forwarding import and export goods, managing and exploiting CFS warehouses and well
performing the signed contracts...............................................................................................66
2.1.2.2. Advantages in company’s operation...........................................................................67

Transportation and warehousing are closely related to economic growth and world trade.
The Government's macroeconomic policy instruments have initially been effective and
brought new opportunities for Vietnamese businesses............................................................67

The government is developing and investing in key sectors of the economy such as
electricity, oil and gas, industry and transportation. These policies bring dual advantages to the
Company when the transportation industry and other sectors that are the main customers of
the Company will receive preferential treatment or development support of the State............67

The company has an extensive network of partners and customers both at home and
abroad, which will be a good force for the Company to further develop its market share in the
market and exploit target customers........................................................................................67


Advantage of having modern technology and advanced equipment is the capable of
carrying out large tonnage contracts........................................................................................67

The company is headquartered in the industrial zone of Dinh Vu Hai Phong port - one of
the arterial traffic points, is one of Vietnam's major border gates and seaports.......................67
2.1.2.3. Disadvantages in company’s operation......................................................................67

The extent of expansion and the involvement of many companies in the field of
warehousing have made competition in the market become fiercer. The competition is not
only reflected in the market share but also in the fee rates between companies when most
customers are now interested and consider price as the only criterion in selecting service
providers..................................................................................................................................67


Changes in world petrol prices have a direct impact on the Company's production costs68


As warehousing and transporting are main business sector, all types of machinery and
equipment are types of assets that could cause harm to employees.........................................68
2.1.2.4. Business results and financial position of the company in 2019.................................68
* Business results...................................................................................................................68
Currency: VNĐ.......................................................................................................................68
Table 2.1: Main indicators reflects business results of the company in 2019..........................68
* Financial position...............................................................................................................69
Currency: VNĐ.......................................................................................................................69
Table 2.1: Main indicators reflects financial position of the company in 2019........................69
2.1.2.5. Production and business plan in 2020.......................................................................69
Due to the outbreak of Corona virus, business plan of the company had been reduced into the
two following plan:.................................................................................................................69

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

Become an exclusive distributor of Fujiaire....................................................................69



Other quotas will follow the previous year’s business plan.............................................69

If the market shows improvement after the outbreak, the plan could be change so that it would
suit the practical situation........................................................................................................70
2.1.3. Characteristics of organising management mechanism of Duyenhai Trading and
Manufacturer, Ltd..................................................................................................................70
2.2.2.1. Business results’s analysis at Duyenhai Trading and Manufacturer, Ltd...................83
CHAPTER 3.............................................................................................................................98

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PREFACE
1. The urgency of the study
In the current situation, our country is in the process of economic
development and integration according to the development of the world and
the trend of the times. Economic integration and development is an
opportunity and also a great challenge for the country's economy in general

and in particular domestic enterprises in particular. This requires each
enterprise to make efforts, maximize its advantages, as well as overcome the
weaknesses that still exist in order to integrate with the world economy. In the
era where science and technology are advancing and upgrading by hour, a
single decision can decide the fate of an entire business entity.
To be able to make a right decision, the leaders must have information
about company’s current status presented clearly and faithfully, so that no
items shall be mistaken. Having a good accounting information system also
allows director to manage the company’s operation so that if any problem
arises, they can interfere and solve the problem in no time. But the accounting
information system is too complicated for users such as creditors, lendors, and
employees… to understand, so a need for a compact but fully and clearly –
presented occurred, and financial statements was made. Financial statements
are written records that convey the business activities and the financial
performance of a company.
Financial statements are often audited by government agencies,
accountants, firms, etc. to ensure accuracy and for tax, financing, or investing
purposes. Investors and financial analysts rely on financial data to analyze the
performance of a company and make predictions about its future direction of

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the company's stock price. Financial statements are the main source of
financial information for most decision makers.
On the base of practicing thesis and theories of preparing and analysing
financial statements which had been studied at the academy and
understanding practical situation at the company, under guidance and support
of supervisor, MSc Nguyen Ba Linh and the company’s employees, I had

achieved some success in researching company’s practical operation. This is
also an opportunity given to us by the academy to strenghthen the knowledge,
as well as develops suitable skills. Based on that, I decided to choose the topic
of “The preparation and analysis of financial statements in DUYENHAI
Trading and Manufacturer, Ltd” to make my graduation thesis.
2. The purpose of the study
Based on the theoretical basis that has been studied in combination with
the actual study in the enterprises, the topic of the thesis is selected and
studied to meet the following objectives:
− Obtain a brief view of process of preparing and analyzing financial
statements at Duyenhai Trading and Manufacturer, Ltd.
− Provide comments, evaluations to contribute to promoting the
development of the process of preparing and analyzing the financial
statements at the company.
3. The subject and scope of the study:
 Subject: The preparation and analysis of financial statements at
Duyenhai Trading and Manufacturer, Ltd.

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