4. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
 
4.27 Borrowing costs
 
Borrowing costs include accrued interest and other expenses which are directly attributable to the Company’s borrowings and bonds issued. 
 
4.28 Cost of securities sold 
 
The Company applies moving weighted average method to calculate cost of equity securities sold.
 
4.29 Corporate income tax
 
Current income tax 
 
Current income tax assets and liabilities for the current and prior year are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted as at the report date.
 
Current income tax is charged or credited to the income statement, except when it relates to items recognized directly to owners’ equity, in which case the current income tax is also dealt with in owners’ equity.
 
Current income tax assets and liabilities are offset only when there is a legally enforceable right for the Company to set off current tax assets against current tax liabilities and when the Company intends to settle its current tax assets and liabilities on a net basis.
 
Deferred income tax 
 
Deferred income tax is provided using for temporary differences at the reporting date between the tax base of assets and liabilities and their carrying amounts for financial reporting purposes.
 
Deferred tax liabilities are recognized for all taxable temporary differences, except when the deferred tax liability arises from the initial recognition of an asset or liability in a transaction which at the time of the transaction affects neither the accounting profit nor taxable profit or loss.
 
Deferred tax assets are recognized for all deductible temporary differences, carry forward of unused tax credits and unused tax losses, to the extent that it is probable that taxable profits will be available against which deductible temporary differences, carry forward of unused tax credits and unused tax losses can be utilized, except where the deferred tax asset in respect of deductible temporary difference which arises from the initial recognition of an asset or liability which at the time of the related transaction, affects neither the accounting profit nor taxable profit or loss.
 
The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to a certain extent that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Previously unrecognized deferred income tax assets are re-assessed at each reporting date and are recognized to the extent that it has become probable that future taxable profit will allow the deferred tax assets to be recovered.
 
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled based on tax rates and tax laws that have been enacted at the reporting date. Deferred tax is recorded to the consolidated income statement, except when it relates to items recognized directly to owners’ equity, in which case the deferred tax is also dealt with in owners’ equity. Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxable entity and the same taxation authority and the Company intends to settle its current tax assets and liabilities on a net basis.
 
4.30 Owners’ equity 
 
Contributed capital from shareholders 
 
Contributed capital from stock issuance is recorded in Charter Capital at par value.
 
Undistributed profit
 
Undistributed profit comprises of realised and unrealised undistributed profit.
 
Unrealised profit of the year is the difference between gain and loss arising from revaluation of financial assets at FVTPL or other financial assets through profit and loss in the consolidated income statement, and the deferred income tax related to the increase in revaluation of FVTPL.
 
Realised profit during the year is the net difference between total revenue and income, and total expenses in the consolidated income statement of the Company, except for gain or loss recognized in unrealised profit.
 
Reserves
 
According to Circular No. 146/2014/TT-BTC issued by the Ministry of Finance on 6 October 2014, securities companies are required to make appropriation of profit after tax to the following reserves:
 
 
Other reserves are appropriated in accordance with the Resolution of the General Meeting of Shareholders.
 
4.31 Appropriation of net profits  
 
Net profit after tax is available for appropriation to shareholders after being approved by the General Meeting of Shareholders and after making  appropriation to reserve funds in accordance with the Company’s Charter and Vietnam’s  regulatory requirements.  
 
4.32 Nil balances 
 
Items or balances required by Circular No. 210/2014/TT-BTC dated 30 December 2014, Circular 334/2016/TT-BTC dated 27 December 2016 and Circular No. 146/2014/TT-BTC dated 6 October 2014 issued by the Ministry of Finance that are not shown in these consolidated financial statements indicate nil balances.
 
5. CASH AND CASH EQUIVALENTS
 

 

6. VALUE AND VOLUME OF TRADING DURING THE YEAR