Debt of corporations and general companies up to nearly 70% of capital

The audit results of 271 enterprises belonging to 27 groups and corporations show that the payable debts of these units amount to nearly 70% of total capital. This shows that the enterprises operate mainly with borrowed capital and appropriated capital.

This is the figure just announced by the State Audit at the press conference on the 2012 audit results on the morning of July 25.

According to Mr. Dao Quang Dung, Director of the General Department, State Audit, the total capital of audited corporations and general companies up to December 31, 2011 was over 263,000 billion VND, of which equity capital accounted for 24.7%.

However, analyzing the above figures in detail, Mr. Dung said that the debt of the above units accounts for 69.94% of total capital.

Some names pointed out by the auditors have a debt to total capital ratio of up to nearly 90% such as the Civil Engineering Construction Corporation 4 (Cienco 4), or even over 90% is the Vietnam Construction Corporation (Vinaincon). Vinaconex is also another "big guy" mentioned by the State Audit with a debt ratio of up to over 81%.

According to the State Audit, overdue debts in some corporations and general companies are also at a high level. Among them, the names "named" by the State Audit are Vietnam Oil and Gas Construction Corporation (PVC) with overdue debts of over VND 1,369 billion, Construction Corporation of Transport Works 8 (Cienco 8) with over VND 73 billion, and Vietnam Coffee Corporation (Vinacafe) with overdue debts of over VND 150 billion.

The State Audit Office has assessed that the borrowing and use of borrowed capital in corporations and general companies still has many shortcomings. Some investment projects using borrowed capital, according to the audit industry, are ineffective and behind schedule, leading to difficulties in debt repayment.

Some units were even frankly assessed by the State Audit as "not being able to preserve capital." Among them, Cienco8, the Military Petroleum Corporation (Mipeco) or the Vietnam National Petroleum Group (Petrolimex) are large enterprises classified by the State Audit as being in the above category.

While the debt payable by corporations and general companies is at a high level, the receivable debt of these units is assessed by the State Audit as "poorly managed and with high bad debt."

The State Audit believes that the lack of strict control of receivables has led to the large capital misappropriation of customers by many businesses.

In particular, the ratio of receivables to total assets of many companies is up to 30-50%, such as Construction and Industrial Production Joint Stock Company (40%), Vietnam Forestry Corporation (over 39%), Vimeco Joint Stock Company under Vietnam Construction and Import-Export Joint Stock Corporation (over 44%),...

In other enterprises, the State Audit also frankly stated that there was a situation of loose management of advance debt leading to large overdue receivables, cash advances amounting to tens of billions of dong but slow collection.

According to (Vietnam+) - LY