A business turns losses into profits due to ‘computer error’

At the end of last year, the State Securities Commission (SSC) imposed a fine of VND 185 million on Phuong Anh International Joint Stock Company (PAS). This enterprise committed two violations: disclosing information on time and misleading. In the fourth quarter 2023 financial report, PAS reported a profit of nearly 106.5 billion VND, but in the audited annual financial report, the profit was actually negative at more than 288.9 billion VND.

In a recent document sent to SSC, Chairman of the Board of Directors Nguyen Hung Cuong explained that it was due to an objective error during the process of data entry and conversion of financial report files. By 2023, accounting personnel are constantly changing, new people lack experience and weak qualifications. At the same time, the accounting department’s mechanical system is old and outdated, leading to file processing errors and inaccurate data.

“This violation of false information is the first time, revenue and other figures have not changed,” he added.

Phuong Anh International Joint Stock Company was established in 2010, specializing in providing all types of steel and metal products, with headquarters and factory located in Hung Yen. PAS shares have been traded on UPCoM since the end of September 2020. Closing today’s session, this code dropped to 3,000 VND, 35% lower than the price range in the middle of last year.

According to information published by PAS, in the period 2015-2018, they earned a profit of more than ten billion dong each year. After that, profits fluctuated strongly, had a very thin year like 2019, then set a record in 2021.

In the first 9 months of 2024, PAS reported revenue of nearly 813 billion VND, an increase of 56%. Profit after tax from negative in the same period to positive 2.2 billion VND. The board of directors said they are still facing difficulties with the steel industry but are actively promoting sales, searching for markets, and reducing financial and management costs.

Recently, SSC has punished many businesses for turning losses into profits in their self-made financial reports. In mid-December 2024, Rang Dong Holding (RDP) was fined 150 million VND because it previously reported a profit of more than 17.3 billion VND in 2023 but actually lost more than 117.6 billion VND. After that, International Holding was also fined 175 million VND for an after-tax loss of more than 70.8 billion in 2023 but announced a deficit of just over 4.4 billion in profit.