Managing_Corporate_Finance

[pic][pic] Course: MBA in General Management-Vietnam Level: M Module: Managing Corporate Finance Credits: 12 Assignment: One of one Weighting: 100% Date Issued: posted on WebCT on December 1, 2006 Submission Date: Friday 13th April 2007 Tutor: Terry Elliott Contact Details: Telephone (0044)-1204-903024 ID Student: 0508265/1 INTRODUCTION Vietnam became the 150th member of World Trade Organization (WTO) on 11 Jan 2007. Its day was a special day as it set a historic landmark in Vietnam’s economic development. Not only is it the landmark in Vietnam‘s stride for full integration into the global economy, but also the historic milestone in our country’s long process of pursuing the renovation. Besides the efficient negotiations have helped open the WTO door to Vietnam, but the driving force behind is the country’s renovation, which was initiated 20 years ago. And our country currently is being accessed as a dynamic developing country in the world. We totally noted that opportunities are one side of the new era, while the other side exposes challenges and risks. Foreign develop investment (FDI) inflow is likely to surge due to the market-opening policies; harsher competition will knock out many local corporate players. But from an overall perspective, our country’ economy will be benefit. This significance event brings abundant challenges and opportunities to government, to all business sectors. Especially, as consequence, to adequate structure policies reform and “The financial sector reform is the center of such reform, which will contribute to both external and domestic capital mobilization for competitive industries “as the JIBC chief opinion. Indeed, Corporate Finance environment is one of the dominant respects that mainly impacts to any country’s economic. Proven experience spending in a lot countries that Finance environment had played as a key role in luring foreign capital investment. In this paper I will analysis of the impact of the recent accession of Vietnam to WTO with respect to the Corporate Finance environment and to Auto industry that is the business sector I am working now. LITERATURE REVIEW Studying from China, this country joined to WTO on 2001, opening up of the financial industry is an important part of the whole opening strategy for China. Financial is also the rational choice to further open up its economy and benefit from the strategy called ‘improvement through contact’. Full-scale contact with the international markets means that China may gain access to global economic resources in a broader scope and at the same time expose the domestic financial market to the impact (Globalization: the Role of Institution Building in the Financial Sector- The Case Study of China-, August 2003) Acknowledge from China ‘ experience and as commitment road map with WTO, Vietnam government quickly concentrate to financial globalization field, they initiate quickly focus to have a clear – sighted in a mass financial trading policies issues and this change reality bring a good view to administrative reform in Vietnam. One of major part to form the corporate financial environment is Accounting information. Why do companies provide accounting information' Public companies have a variety of stakeholders: shareholders, bondholders, bankers, suppliers, employees, and management, for example. These stakeholders all need to monitor how well their interests are being served. They rely on the company’s periodic financial statements to provide basic information on the profitability of the firm (Richard A. Brealey, Stewart C. Myers, Alan J. Marcus, 2001). That value information, at present, is magnetic needle/ value goods for businessman in security market. Its power and influence is more and more impact to every Company and national even. Those audited data aspect have ever brought and decide a vital question of a business. False information is forbidden in corporation, tax law that issue is partly indicated the key role indispensable of accounting data in business environment. How we can calculate it' Where we can get that information' Financial statement is the respond to those questions. It is indeed contained importance information on Company’s operating and financial position. Because these statements are widely standardized, the date they contain can be used to make the comparisons between firms and over time. The relationship between certain items of finance data can be used to identify areas where the firm excels and, more importance, areas of opportunities for improvement. Review on that report, at least, you can analyze a firm’s overall performance and assess its current financial standing. You may, more over, wish to understand the policies of a competitor or the financial health of a customer. And financial ratios calculated is a useful tool to analysts summarize from the large volume of accounting information that will extract or provide from many effective Accounting software programs likes Sun system, Tally, Salomon, and so on. All are the smart products from Informatics technology system. Here we mention the most common accounting ratios analysis. It allows present and prospective stockholders and lenders and the firms’ management to evaluate the business ‘s financial management. It can be performed on a cross-sectional or time-series basis. Benchmarking is a popular type of cross-sectional analysis in which the firm’s ratio value is compared to those of a key competitor or group of competitors, primarily to identify where is the room for improvement in business. You have to careful considered to the cautions in ratios analysis. It includes (1) a single ratio does not generally provide sufficient information;(2) financial statements being compared should be dated at the same point in time during the year. If they are not, the effects of seasonality, period may produce erroneous conclusion;(3) audited financial statement should be used, If the statement not been audited, the date contained in may not reflect the true financial condition;(4) data should be checked for consistency of accounting treatment. The use of different accounting way- especially relative to inventory and depreciation – can distort the results of ratios analysis, regardless with analysis way is used; and (5) inflation and different assets ages can distort ratio comparisons. Inflation can cause the book value of inventory and depreciable assets to effect greatly from their true value. Avoid those cautions will be provided a satisfy conclusion analysis. ( Lawrence J. Gitman, biref ed. 1998) As a rule, the necessary inputs to an effective financial analysis include, at medium, the balance sheet and income statement. Two basic ones will be as the source data given to calculate some popular ratios. We can measure (A) the liquidity, or ability of the firm to pay its bills as they come due by network capital, its current ratio, or quick (acid-test) ratio. Activity ratios measure the speed with which various accounts are converted into sales or cash. Liquidity refers to the solvency of the firm’s overall financial position. Three basis measure of liquidity are (1) Net working capital, (2) the current ratio, and (3) the quick (acid-test) ratios;(B) The efficiency ratios, in which activity of inventory can be measured by its turnover that of accounts receivable by the average collection, and that of account payable by the average payment period. Total asset turnover can be used to measure the efficiency with which the Company has used its assets to generate sales. Its ratios are including (1) Inventory turnover, (2) Average collection period, (3) Average payment period, and (4) Total Asset turnover;(C) the leverage ratios, here we discuss the relationship between debt and financial leverage and the ratio that can be used to assess the firm’s degree of indebtedness and its ability to meet interest payment associated with debt. The more debt a firm uses, the greater its financial leverage, which results in the magnification of both risk and return. Financial debt ratios measure both degree of indebtedness and the ability to pay debts. A commonly used measure of debt position is the debt ratio, and the ability to make contractual interest payment can be measured by times interest earned; and (D) We evaluate a firm’s profitability relative to its sales, assets investment, and owners’ equity investment. Measures of profitability can be made in various ways. The common-size income statement, which shows all items as a percentage of sales, can be used to determine gross profit margin, operating profit margin, and net profit margin. Other measures of profitability include return on total assets (ROA) and return on equity (ROE). . Mentioning financial ratios we could not miss the Du Pont system of analysis approach. It acts as a search aimed at finding the key areas responsible for the firm’s financial condition. By merging the income statement and balance sheet into two summary measures of profitability. This approach helps the analyst having an overall look at the firm’s financial performance. Formulas financial ratios is listed as table following: |Ratio |Formula | |Liquidity | | |  |  | |Net work capital |Current Assets - Current Liabilities | |Current Ratio |Current Assets / Current Liabilities | |Quick (acid-test) ratio |(Current Assets - Inventory) /Current Liabilities | |  |  | |Activity | | |  |  | |Inventory turnover |Cost of Goods sold / Inventory | |Average collection period |Account receivable / Average sale per day | |Average payment period |Account payable / Average sale per day | |Total Asset turnover |Sales / Total Assets | |  |  | |Leverage (Debt) | | |  |  | |Debt ratio |Total liabilities / Total Assets | |Times interest earned ratio |(Earning before Tax and Interest) / Interest | |  |  | |Profitability | | |  |  | |Gross profit margin |Gross profit / Sales | |Operating profit margin |Operating profit / Sales | |Net profit margin |Net profit after Taxes / Sales | |Return on Total Assets (ROA) |Net profit after Taxes / Total Assets | |Return on equity (ROE) |Net profit after Taxes / Stockholder's equity | |Return on equity (ROCE) |Net profit after Taxes / Capital employed (Loan +Stockholder's equity) | |  |  | Note: /: divide; -: minus CRITICAL ANALYSIS Vietnam had spending a sleeping economic nearly 10 years with an isolationist policy. It has not, as a result, had much success in improving the efficiency of its commercial or consistent economic growth. Renewal (doi moi) is the word begin to use in newspaper, government meeting, daily citizen life on 1986, convey a determine to enhance Viet Nam that is a country clearly wanting a closer connections with the rest of the world, although at that time policies to promote finance international trade or to attract adequate foreign investment have lacked direction. Strategy is rarely appears in firm’ reports. A look back we may see a long term lack of dynamic, strategy but we also admire a difficult stage Vietnam peoples have to spend to recover a huge of war losses after 30 April 1975. So WTO accession is a strong evidence of Vietnamese’ spirit do want to integrate to wide global. A great remark in year 2005 Vietnam joined to Association of Southeast Asian Nations (ASEAN), ASEAN Free Trade Area (AFTA). The July 13, 2000 signing of the Bilateral Trade Agreement (BTA) between the U.S. and Vietnam was a significant milestone for Vietnam's economy. The BTA provided for Normal Trade Relations (NTR) status of Vietnamese goods in the U.S. market. Access to the U.S. market will allow Vietnam to hasten its transformation into a manufacturing-based, export-oriented economy. It would also concomitantly attract foreign investment to Vietnam, not only from the U.S., but also from Europe, Asia, and other regions. The country’s WTO membership also has boosted investor confidence and the investment environment has improved, with licensing power further decentralized to streamline the investment approval process. Indeed, The higher-than-expected FDI inflow plus the favorable conditions brought by its entry and its successful hosting of the 14th APEC meeting is behind the ministry’s proposed target. Total FDI was lured after three first month of year 2007 is US$2,5 billion. The growth rate reach 8% is a surpassing progress in Vietnam. WTO accession, how ever, also brings serious challenges, requiring Vietnam's economic sectors to open the door to increased foreign competition. Local companies are facing problems such as poor and insufficient facilities, and financial constraint, which have made them less competitive internationally. No survival for low efficiency and quality standards. Especially, inconsistent regulations issued by authorities, such as customs, Tax policies, worst even as not transparency /often changing had be leaving much negative impact on the operations of business. So legalisation reform is one of premary prerequisite to speed up Vietnam business environment stranpery and fairly with international standard. And till up to entry date 7 November 2006, Relative to WTO assession, Vietnam had registered and set up 26 laws and ordinances and 25 of ones be done till 07 November 2006. VN have to continue ammending to excise tax, Coporate laws and Trade marke violate degree as commitment with WTO. Catching those opportunities now is a clearly making an enthusiastic environment to Vietnam economic. And our Company- Mercedes Benz Vietnam (MBV)- is not exemption. MBV established in 1995, as a member of Daimler Chrysler. It is one of the top automaker in Vietnam to supply both passenger cars and commercial vehicles to Vietnam market. MBV also is member of Vietnam Automobile Manufacturer Association (VAMA) that organization be founded to protect and develop Vietnam Auto Industry. Our MBV’ board of management (BOM) is having an extension plan to export oversea market likes Lao, Cambodia and ASEAN countries. To take full advantage of import tax rate help to reduce a key material cost and according to WTO road to year 2010 almost tax rate including sensitive goods all reduce from 0 to 5% to that market. MBV have to motivate itself to stay and develop in the dynamic market after WTO accession. Automobile is a young industry in Vietnam with a small market-share but 17 Auto plants had licensed, competition pressure is high. Auditing own business position in the Auto market and accessing internal status those both sides are tactical of each VAMA member. The more sharpen in competition, the higher requirement of this decisive factor to finance corporation environment in general and to finance department especially when Vietnam market entered to WTO. To implement WTO commitment tax road map, Ministry of Finance (MoF) has just issue a new rate of new car import just 80% (old rate 150%-200%) right away to enter WTO. Auto firms likes our MBV now is facing the import car with favor tax, international quality, genuine trade mark from all over the world entering to Vietnam. Pressure competitive is hardly issued to each VAMA member, so each business has to protect itself by its own tactical. Survive, stay and develop is difficult issue for local business now. Our Company-MBV- immediate used Balance Score Card (BSC) in system reports as requirement from global regional in Singapore. Not only control internal business flow from input to output, but also external compare with the other Companies in WAMA. It is helpful in understanding our position in market share, in capacitive production, in innovation technology from competitors. Example here is market share drawing of Oct 2006 based on sales volume: [pic] But its action is just show the external sign as it is the limit of this tool, we only compare one kind of business sector, one type kind of unit in comparison e.g. sale volume of this Co. to sale volume of other Co, the same turnover with turnover, capacity production with capacity production and so on. It could not presented in internal sign effective of business. Example one unit E280 model of MBV with 126,000 USD of unit price sold we count is one in quantity sale report and one unit Toyota Zace of Toyota with 25,000USD per unit also calculated is one so market share above do not fully demonstrated level best in selling. More over, profit capacity of each model very difference, it depends on how much in investment to that one. So the same in using financial ratio analysis, it partly helps BOM has a whole view of our own Company, of business sector likes VAMA in Vietnam. Due to each business have a different strategy, so ratio some time has one-sides showing only. In this paper, we will take some popular ratios based on the 2005- 2006 ‘ Income statement (Profit and Loss – P&L) and Balance sheet (BS) of MBV to audit internal operation management performance. Mercedes Benz Vietnam Ltd BALANCE SHEET | | | December 31 | | | |2006 | |2005 | | | | US$000 | | US$000 | | ASSETS | |CURRENT ASSETS |  | | | | |Cash & Bank Balances | | | | | | |12,626.00 | |14,365.00 | | |Inventories | | | | | | |13,718.00 | |10,150.00 | | |Account receivable | | | | | | |1,245.00 | |3,645.00 | |Total CURRENT ASSETS | 27,589.00 | | 28,160.00 | | | |  | | | |FIXED ASSETS |  | | | | |Building & Structures | | | | | | |18,710.00 | |15,221.00 | | |Machineries & equipments | | | | | | |12,484.00 | |10,256.00 | | |Office equipments & furnitures | | | | | | |1,648.00 | |1,112.00 | | |Motor vehicles | | | | | | |1,406.00 | |2,564.00 | |Sub total | | | | | |Less: Accumulated Depreciation | | | | | | |(14,043.00) | |(11,393.00) | | |Construction in progress | | | | | | |510.00 | |949.00 | | |Deferred tax asset | | | | | | |555.00 | |- | |Total FIXED ASSETS | 21,270.00 | | 18,709.00 | |INTANGIBLE ASSETS | | | | | |Land use right | | | | | | |7,508.00 | |7,508.00 | | |Patents | | | | | | |2,119.00 | |2,119.00 | | |Other intangible fixed assets | | | | | | |89.00 | |- | | |Sub total | | | | | | |9,716.00 | |9,627.00 | | |Less: Amortization | | | | | | |(4,587.00) | |(4,101.00) | |Total INTANGIBLE FIXED ASSETS | 5,129.00 | | 5,526.00 | | | | | | | |TOTAL ASSETS | 53,988.00 |  | 52,395.00 | |LIABILITIES AND OWNER'S EQUITY | |CURRENT LIABILITIES | | | | | |Short-term bank loans | | | | | | |- | |700.00 | | |Trade Creditors | | | | | | |6,543.00 | |10,209.00 | | |Taxes payable | | | | | | |545.00 | |218.00 | | |Deposit from customers | | | | | | |270.00 | |320.00 | | |Other payable | | | | | | |196.00 | |256.00 | | |Intercompany payables | | | | | | |201.00 | |895.00 | |Total CURRENT LIABILITIES | 7,755.00 | | 12,598.00 | |NON-CURRENT LIABILITES | | | | | |Accruals | | | | | | |2,471.00 | |1,668.00 | | |Unrealized Interest Income | | | | | | |- | |- | |Total NON-CURRENT LIABILITIES | 2,471.00 | | 1,668.00 | |TOTAL LIABILITES | 10,226.00 | | 14,266.00 | |OWNER'S EQUITY | | | | | |VN Capital - Kind | | | | | | | | |7,500.00 | |7,500.00 | | | | |Foreign Capital - Cash | | | | | | |17,500.00 | |17,500.00 | | |Retained Earning | | | | | | |18,762.00 | |13,129.00 | |Total OWNER'S EQUITY | 43,762.00 | | | | | | |38,129.00 | | | | | | | |TOTAL LIABILITIES AND OWNER'S EQUITY | 53,988.00 |  | 52,395.00 | Mercedes Benz Vietnam Ltd INCOME STATEMENT | | For the year ended | | | December 31 | | | 2,006 | | 2,005 | |  |  |  |  | | | US$000 | | US$000 | | | | | | |Sales | 61,686 |  | 34,870 | | | | | | |Cost of Sales | 42,824 | | 22,204 | |Gross Profit | 18,862 |  | 12,666 | | | | | | |Operating Expenses | | | | |General and administrative expenses | | | | | |2,443 | |2,115 | |Selling expenses | | | | | |5,700 | |4,935 | |Finanical Charges | |  | | | |1,678 | |1,179 | |Total Operating expenses | 9,821 | | 8,229 | | | | | | |Operating Profit / (Loss) | 9,041 |  | 4,437 | |Other Income ( Loss) | |  | | | |32 | |(19) | |Net Profit (Loss) Before Taxes | 9,073 |  | 4,418 | | | | | | |Corporate Income Tax | 907| | 441 | | | | | | |Net profit/(loss) after taxation | 8,166 |  | 3,977 | We can easily to calculate some popular ratios as: |Liquidity | | |Year 05 | | | | |Year 06 | | | |Net work capital |Current Assets - Current Liabilities | | 16,262| | | |19,834 | | |Current Ratio |Current Assets / Current Liabilities | | | | | |3.56 |2.37 | |Quick (acid-test) ratio |(Current Assets - Inventory) /Current Liabilities | | | | | |3.08 |2.35 | MBV has US$3.56 in current assets for every $1 in current liabilities; this rate is higher than year 2005 (2.37), MBV vehicle is one of luxury products in Vietnam so it be treated as low liquidity so in case we use Quick ratio to show that rate by excluding inventory. Here we can say MBV has US$3.08 in current assets for every $1 in current liabilities in year 2006 and $2.35 for year 2005. MBV always enough Cash to pay liabilities, Loan short term is at Nil at the end of fiscal year with purpose to decrease Loan interest charge. The overall liquidity presents stable trend. |Activity (Efficiency) Ratios | |Year 06 |Year 05 | |Inventory turnover |Cost of Goods sold / Inventory | | | | | |3.12 |2.19 | |Average collection period (days) |Account receivable / Average sale per day | | | | | |7.27 |37.63 | |Average payment period (days) |Account payable / Average purchase per day | | | | | |81.49 |241.13 | |Total Asset turnover |Sales / Total Assets | | | | | |1.14 |0.67 | In Inventory turnover ratio, you can easily be converted into an average age of inventory by diving it to 360 days. For MBV, it is come to 115 days (360/3.12) can be view as number of days‘ sales in inventory. Not good sound, lasting to three months, due to type of vehicle product life rather long, from stock in to end user; more over this year City Bus is one of new local product begin to use local spare part, design made in Vietnam, it be needed time to testing, get certificate from state inspection office and so on. Those reason push up longer days. This rate is surely increased in next coming year and number days will be decreased. Next in Average collection period, on average MBV’ customers pay just about 7.27 days. In fact, it is not indicate the efficient of collection department. It is just due to no credit policy so it also is one of the reasons of longer time find easily customer could afford to buy. While Average payment period is 81.49 days (we temporary estimate purchase equaled 70% of cost of good sold). We have a favor credit term from affiliate and mother Company. This is one of the advantages in purchase material issue of MBV. Last in those, Total assets turnover ratio, for MBV, each dollar of assets produces $1.14 of Sales, and noted that assets are likely to change over the years, we can closely compare with Fixed assets (FA), in that case MBV has each dollar of FA generates $ 2.90 of Sales. The higher this rate the more efficiently its assets have been used. Summary, management should consider adjusting sale policy in payment term by paying by installment, and /or financing from Bank to lure customer for decreasing finish goods in stock. |Leverage ratios | | Year 06 |Year 05 | |Debt ratio |Total liabilities / Total Assets | 0.19 | 0.27 | The higher this ratio, the greater the amount of other peoples ‘s money people’s money being used in an attempt to generate profits. MBV is just financed 19 % with debt, and 81 % with equity. Not good for business with that figure, but it is just the end of fiscal year MBV clear Bank loan. This rate has so much way to define so the under face understanding you will have an accurate access. |Profitability ratios | |Year 06 |Year 05 | |Gross profit margin |Gross profit / Sales | | | | | |0.31 |0.36 | |Operating profit margin |Operating profit / Sales | | | | | |0.15 |0.13 | |Net profit margin |Net profit after Taxes / Sales | | | | | |0.13 |0.11 | |Return on Total Assets (ROA) |Net profit after Taxes / Total Assets | | | | | |0.15 |0.08 | |Return on equity (ROE) |Net profit after Taxes / Stockholder's equity | | | | | |0.33 |0.16 | |Return on Capital employed (ROCE) |Net profit after Taxes / Capital employed (Loan +Stockholder's equity) | | | | | |0.33 |0.16 | Gross profit margin, the higher of its rate is the better. MBV created 31% profit of each sales dollar remaining after paid direct cost. Operating profit margin measure MBV 15% profit of each sales dollar remaining after all Cost and expenses (pure profit). And 13% net profit of each sales dollar remaining after all Cost and expenses including interest and Tax. ROA often called return on investment (ROI), the higher this rate, the better. MBV get 15% the capacity effectiveness of management in generating profit from its assets and 33% profit from stockholder ‘s equity. It is good performance. Summary, Year 2006 is good development than year 2005, with new projects to be open in year 2007. BOM and finance department have to detail more analysis deeply each stage, ready go ahead with every figure budget. Here we not yet have the statistic of Auto industry so not yet comment the Cross sectional evaluation, but overall it have been showed a good performance in last year. Again, The financial ratios are very useful in interpreting the financial condition of the firm. In fact, help business so much in analyzing business situation, it accessed how was good or poor policies to control in Sale, in purchase, payable, receivable procedure, where is business in the market and where need be adjust in budget / operation plan, convert to long term or short term and vice versa. Those ratios above also is evidence for BOM, shareholder form strategy or project which consider be opened, which need be stopped or adjusted in time. But those aware in literature section have to be avoided above when measuring, analyst must be careful in interpretation to action, misleading can happen if positive deviation from the analyst so high and conversely. I total agree its figures true or not all be completed depends on the finance manager moral and BOM. Audit figures have ever made some famous Companies fall down just one day due to dishonest data from person no moral sense in finance professional job. As you ever shocked of Enron news year 2001, one of the biggest Energy Companies in American, bankrupt quickly because the cheating financial report. And Arthur Andersen Audit Company is the perpetrator of its. Enron ‘s accounting information has ever been pushed up security market by huge profit data deceitful. The same ruinous situation was in WorldCom year 2005, the second biggest Telecommunication Company of American also gone bankrupt by cheating reports causes. Nowadays accounting data become more and more valuable in stock market. That field is one of hot business sector in the world and currently in Vietnam now is the hottest business news everyday. WTO is a key factor to attract FDI flow in to our country and form a vital force for this market. We could not forget to mention the key role of foreign Banks that play an importance field in Vietnam financial corporation environment. It is also one of the compulsory conditions that government has to develop when make the entry to WTO. Again confirmed that more opportunities come, the higher challenges faced to local business. Changing challenges to opportunities is a strategy wisely in humane resource, Informatics technology, Marketing and Finance Corporation. Each respect all contributes to business stay or not in the market. Our finance department is rushing out with budget plan detail and control function more pressure in analysis given warning status to BOM weekly not monthly as prior time. According to General Director Mercedes-Benz, Dr Udo Loersch, he assures that Auto industry will be having a better promising when Vietnam enters to WTO. He believes MB technology is always over expecting of customers. MBV will stay and develop as export Auto spare part to oversea from local made in Vietnam. Clear proof is after ASEM5, at APEC conference with VN is host, Mercedes-Benz again be selected using for many President and senior ministry. It asserts MB made in Vietnam quality is not different to Euro production at all. Local spare parts made in Vietnam have some stand out than. APEC also is marketable picture to the world, especially with news “ VN accession to WTO “ ( Vn express 20 Oct 2006) The challenges and opportunities is really effected to our country, Permanent Normal Trade Relations (PNTR) to Vietnam by United States Congress adds a perfect spot for Vietnam economic picture. Just after break event day, according to foreign investment department- Investment and Planning Investment Ministry, Vietnam in Mar 2007 now have more 71 projects licensed with capital registered is 455 Million USD. Thus total projects number licensed is 196 with investment amount is US$ 2,071billion; increase 27% of portfolio with the same period. In Auto industry also has the big investor of Volkswagen set up new plant in Haiphong province with initial capital is 120 million USD as evidence for FDI attractive of Vietnam WTO accession. CONCLUSIONS WTO is opening a very bright promising future ahead of Vietnam by a lot of opportunities to government and business sectors, Its entry is a chance to approach international trade, un lift so much Taxies barrier for Vietnam products go out international market, as well as material import with preferential treatment tax tariff. Vietnam's access to WTO provides an important boost to Vietnam's economy and should help to ensure the continuation of liberalizing reforms and create options for trade expansion. The Vietnamese business environment has recently improved significantly, with nearly flawless mechanisms and policies for production, business and investment activities. WTO accession brings much opportunity and not less challenges, but the entire whole it is a change to filter the weakness out from local business. Financial corporate environment plays a dominant part to support for our country to develop through professional Banking service, Auditing, Security market and now more and more successful performance. Thank to this model, it is useful for MBA student like us get a deeply acknowledge the impact of managing finance corporation to national economic. Understanding the importance of accounting information to form decision in strategy investment of business. Vietnam's objective of socio-economic development in 2020 is quite ambitious, namely, to narrow down its gap with the world and "basically to become an industrial country development. This thing is not out beyond and every Vietnamese all have the right to expect that dream come true. 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