Many state corporations suffer losses: State Audit

It follows its audit of 16 companies with 73 subsidiaries, whose results it recently submitted to the National Assembly.

Fifteen of the 16 corporations are profitable.

Many are in fact highly profitable, including PetroVietnam Gas Corporation (PV Gas), which reported profits of VND8.16 trillion (US$351.7 million) in 2020, the audit year, Vietnam Posts and Telecommunications Group (VND5.71 trillion), and telecom giant MobiFone (VND 3.81 trillion).

But many of affiliated companies are making losses.

For instance, chemical company Vinachem and its subsidiaries have accumulated losses of more than VND15.47 trillion, with one even shutting down.

Thai Nguyen Iron and Steel Jsc has three subsidiaries that are inactive.

Two subsidiaries of PVGas have combined losses of more than VND 602 billion.

Things have not gone well for Petrolimex Laos One Member Limited Liability Company, a subsidiary of fuel distributor Petrolimex, which has accumulated losses of over VND114.8 billion and has negative equity of VND57 billion.

VNPT has two subsidiaries that are in the process of dissolution or bankruptcy.

The State Audit also found that some businesses have ineffective bank deposits and cash flow management plans.

Some companies such as PVGas and VNPT have been inefficient in managing their cash and have large sums as long-term deposits in banks.

For instance, when PVGas makes its monthly and quarterly cash flow plan, it let many contracts went surpassed the maturity date.

Furthermore, credit management at enterprises is poor: PVGas has overdue receivables of more than VND 568.8 billion, and MobiFone, VND724.2 billion.

Vinachem has bad debts of over VND10.49 trillion racked up by member companies like Apatit Vietnam One Member Limited Company (VND 403.7 billion), Can Tho Chemical and Fertilizer Joint Stock Company (VND 54.65 billion) and others.

Some businesses sell goods, make deposits to suppliers without guarantee or exceed the value of collateral, and make provisions for bad debts, write-offs, and fixed asset depreciation in violation of regulations.

The State Audit also said that many units with large land parcels do not use them or use them inappropriately.

The audit found that land rent and land-use tax payable was nearly VND1 billion by Region III Petroleum Company, a subsidiary of Petrolimex, and VND 620 million by VNPT.

MobiFone and Petrolimex had not divested from financial, banking and insurance companies according to approved plans or had been slow to do so.

Ten years after becoming a joint stock company, taxi operator Vinasun has yet to complete capitalization procedures.

Enterprises have accounting and declaration errors, and so have to make adjustments to set them right.