VinaCapital Vietnam Opportunity Fund Regulatory News (VOF)

VINACAPITAL VIETNAM OPPORTUNITY FUND LIMITED

(a non-cellular company incorporated in the Bailiwick of Guernsey under The Companies (Guernsey) Law, 2008, on 22 March 2016 with registered number 61765.)

VinaCapital Vietnam Opportunity Fund Limited ("VOF" or the "Company") is pleased to announce its audited results for the year ended 30 June 2023.

The information contained within the announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations ("MAR"). Upon the publication of this announcement via Regulatory Information Service ("RIS"), this inside information is now considered to be in the public domain.

Annual Report and Financial Statements for the year ended 30 June 2023

COMPANY STRUCTURE AND LIFE

The Company is a Guernsey domiciled closed-ended investment company. The Company is classified as a registered closed-ended Collective Investment Scheme under the Protection of Investors (Bailiwick of Guernsey) Law, 2020 and is subject to the Companies (Guernsey) Law, 2008, as amended (the "Guernsey Law"). Prior to March 2016 the Company was a limited liability company incorporated in the Cayman Islands.

The Company is quoted on the Main Market of the LSE with a Premium Listing (ticker: VOF).

The Company does not have a fixed life, but the Board considers it desirable that shareholders should have the opportunity to review the future of the Company every fifth year, by way of voting on a special resolution proposing that the Company ceases to continue. The next such resolution will be put to the Company's annual general meeting in December 2023. For further information, please refer to the section headed "Life of the Company".

INVESTMENT POLICY

Investment Objective

The Company's objective is to achieve medium to long-term returns through investment in assets either in Vietnam or in companies with a substantial majority of their assets, operations, revenues or income in, or derived from, Vietnam.

Investment Policy

All of the Company's investments will be in Vietnam or in companies with at least 75% of their assets, operations, revenues or income in, or derived from, Vietnam at the time of investment.

The Company may gear its assets through borrowings which may vary substantially over time according to market conditions and any or all of the assets of the Company may be pledged as security for such borrowings. Borrowings will not exceed 10% of the Company's total assets at the time that any debt is drawn down.

From time to time the Company may hold cash or low risk instruments such as government bonds or cash funds denominated in either VND or USD, either in Vietnam or outside Vietnam.

HISTORICAL FINANCIAL INFORMATION

^ The figures for 2019 above include adjustments to the share prices of some investments at 30 June 2019 in order to adjust for pricing anomalies identified by the Board. Please refer to the Annual Report and Financial Statements for the year ended 30 June 2019 for a complete explanation.

* Following the change of domicile to Guernsey in 2016, the Company's shares have been quoted in Pounds Sterling ("GBP"). USD NAV per share is translated to GBP using the rate of exchange at 30 June each year.

? Calculated as general and administration expenses divided by average NAV for the year. Ongoing charges have been prepared in accordance with the Association of Investment Companies ("AIC") recommended methodology.

? Calculated as total incentive fee/(income) divided by average NAV for the year. The calculation can be found in the glossary.

? Calculated as the sum of general and administration expenses and total incentive fee/(income) divided by average NAV for the year. The calculation can be found in the glossary.

FINANCIAL HIGHLIGHTS

In the year to 30 June 2023, the Company's NAV per share decreased in US Dollar terms by 2.8% to USD7.02, while the Company's share price decreased by 5.7% to USD5.46. Taking account of dividends paid in the year to 30 June 2023, the NAV Total Return in USD terms was -0.4% and the Share Price total return was -3.1%*.

* Expressed in percentage terms, is a measure of the investment return earned by the Company, calculated by taking the change in the NAV over the period in question and dividing by the starting NAV. This assumes that any dividends paid in the period are reinvested at the prevailing NAV per share on the ex-dividend date and that the dividend would grow at the same rate of return as the NAV per share after re-investment. A numerical reconciliation of the NAV total return can be found in the glossary. This footnote applies to all disclosures of NAV Total Return throughout this Annual Report and Financial Statements.

** Expressed in percentage terms, is a measure of the return to shareholders, calculated by taking the change in the share price over the period in question and dividing by the starting share price. This assumes that any dividends paid in the period are reinvested at the prevailing share price on the ex-dividend date and that the dividend would grow at the same rate of return as the share price after re-investment. The Share Price total return is provided by an independent third-party provider of investment statistics - see glossary. This footnote applies to all disclosures of Share Price total return throughout this Annual Report and Financial Statements.

*** Calculated as NAV per share less share price divided by NAV per share. The calculation can be found in the glossary.

CHAIRMAN'S STATEMENT

Dear Shareholder,

Since it touched a high point at the end of February 2022, the Vietnamese equity market has been adversely affected by conditions in the global economy and international capital markets. In the second half of 2022, the negative sentiment was exacerbated by a crackdown by the Vietnamese government on corruption and poor business practices, particularly in the real estate sector.

A number of the investments in the private equity component of the portfolio are investments described as "public equities with private terms" or "PEPT" where the Company has invested in instruments issued by public companies but where the Investment Manager has negotiated downside protection. A number of these were issued by companies in the real estate sector. At the time the Board approved the interim accounts, with one event of default having taken place and with the prospect of further such events, it was not clear how the specific protections the Investment Manager had put in place would work. As a result, the Board reduced the overall fair values of these investments by USD52.9 million as at 31 December 2022 and I reported at the half year that the Company's NAV per share declined by 14.5% in the six months to 31 December 2022.

Since the beginning of 2023, some confidence has returned to the equity market and the real estate market has shown signs of a return to stability, although recovery is likely to take some time . Against that background, the Investment Manager has made good progress in renegotiating terms and improving the security of the PEPT investments. In each case, the Investment Manager continues to work towards a full recovery over time of the original investment and contractual returns and, reflecting this, the Board has approved an increase in the fair values of these investments of USD26.8 million as at 30 June. Separately, our independent valuers recommended increases in the carried values of five "traditional" private equity investments as at 30 June 2023 compared with their values as at 31 December 2022 and, as a whole, the increase in the PEPT and Private Equity investments in the second half of the year totalled USD54.3 million. These uplifts, alongside an overall improvement in listed equity valuations, contributed materially to a recovery in NAV in the second half of our accounting year- an overall rise of 14.9%.

The NAV total return1 for the whole year under review was -0.4%. We regularly remind shareholders that they should view their holding in the Company as a long term investment and, over a five-year period, the NAV total return2 was 45.0%. The Board believes that this is a strong outcome, especially considering the challenges posed by COVID-19 and the more recent resurgence of global inflation and reduced economic growth. Our Investment Manager does not follow any benchmark in managing the portfolio but the Board is aware that investors will always compare the Company's performance with the VN Index. The NAV outperformed the index over the year under review and the five-year period by 5.7 % points and 21.9% points respectively.

1The NAV declined by 2.8% over the year under review and, accounting for dividends paid, the NAV Total Return (which is an Alternative Performance Measure: see Glossary) was -0.4%

2The NAV increased by 30.5% over the five years from 30 June 2018 to 30 June 2023 and, accounting for dividends paid, the NAV Total Return (which is an Alternative Performance Measure: see Glossary) was 45.0%

Dividends

Our policy is to pay out dividends of approximately 1% of NAV per share, twice each year and normally declared in March and October. In October 2022 we declared a dividend of 8.0 cents per share and in March 2023 we declared a dividend of 6.25 cents per share. The reduction in the half yearly dividend reflected the decline in NAV per share over that period.

The Directors recognise the importance of regular dividends for some shareholders and, in October 2023, declared a dividend of 7.0 cents per share, the increase broadly reflecting the increase in NAV in the second half of the financial year. This will be payable to shareholders on or around 4 December 2023.

Borrowings

In March 2023, the Company extended its USD40 million secured revolving credit facility with Standard Chartered Bank for a further year. This facility provides an additional source of short-term liquidity for the Investment Manager, particularly as it manages the Company's cash flows in some illiquid investments.

Marketing and the Discount

We continue actively to promote the Company. Our Investment Manager makes great efforts to encourage investment and is assisted by our brokers, Numis Securities Limited, distribution partner, Cadarn Capital and Barclays Bank Limited PLC which provides investor engagement services. A wide variety of information is available to existing and potential investors with the aim of stimulating demand for the shares: a detailed fact sheet is issued each month and regular updates on the Vietnamese market and economy in both written and video form are posted to our website. You can sign up to be notified of new publications at https://vof.vinacapital.com and I particularly recommend the video updates, which really help bring the case for investment to life.

The discount was under pressure for a large proportion of the year under review, in common with much of the closed-end fund sector, and the Company has renewed its efforts to manage the discount through share buybacks. During the year, 3.4 million shares were bought back, which was 2.1% of shares in issue at the start of the period. The discounts at which these shares were bought resulted in an increase in the NAV of some 2.7 US cents per share to the benefit of continuing shareholders and, the Directors believe, helped to control the volatility of the discount.

We will continue to publicise the long-term potential of investment in Vietnam and the benefits of the Company's unique approach to investing and will continue to use share buybacks where we believe that these are in the best interests of the shareholders.

Investment Management Fees

As a result of the exceptional performance in the year ended 30 June 2021, a balance of USD22.8 million (discounted for the time value of money to USD20.4 million) was brought forward in the Company's accounts as an accrual for potential payment of incentive fees in this and future years. As a result of the decline in NAV this year no further incentive fees were accrued and, of the amount carried forward, USD1.2 million has been clawed back. USD15.8 million will be paid out on publication of this annual report and USD5.8 million will be carried forward and may be paid out in future years, depending on the investment performance. Note that the amount to be paid out does not affect this year's ongoing charges ratio as it was accounted for in the 2020/21 accounting year - and also the amount clawed back has reduced the ratio for this year.

The Board recognises that there is downward pressure on investment management fees in many parts of the world. However, we also recognise that Vietnam is a developing market and the types of investment which the Company typically makes require a high level of resources, both in negotiating investments and in managing existing holdings. Against this background, we announced in March 2023 that we had agreed with VinaCapital that the management fees with effect from 1 July 2023 are as follows:

(a) Base Fees

? 1.30% of net assets up to the first US$1,000 million of net assets.3

? 1.00% of net assets between US$1,000 million and US$1,500 million.

? 0.75% of net assets between US$1,500 million and US$2,000 million.

? 0.50% of net assets above US$2,000 million.

3To 30 June 2023: 1.50% of net assets, levied on the first USD500 million of net assets and 1.25% of net assets, levied on net assets between USD500 million and USD1,000 million. Base fee levels for net assets of over $1,000 million unchanged.

25% of any incentive fees paid will be invested in shares in the Company. These may not be sold until they have been owned for at least five years.

4To 30 June 2023: 8% compound annual return

5To 30 June 2023: calculated at a rate of 12.5%

The Board

Thuy Dam retired from her position as Director of the Company on 18 April 2023. Thuy had been a Director for nine years and her retirement was in compliance with best corporate governance practice. She made an important contribution to the Company, providing the Board with insight and representation in all matters Vietnamese. The Board has valued her contribution greatly and she will be missed at both a business and a personal level. The Board would like to wish her all the best in her future endeavours.

Thuy played an important role in the identification of a replacement Vietnamese director, and this work culminated in the appointment of Hai Thanh Trinh as a Director of the Company on 30 June 2022. Thuy acted as a mentor to Hai from his appointment and the Board is pleased that he is now well settled into his role.

Annual General Meeting

This year's AGM will take place in Guernsey on 6 December 2023 at Aztec Group, Trafalgar Court, Les Banques, St Peter Port, Guernsey, GY1 3PP. Notice of the AGM is sent to registered shareholders with the Annual Report and Financial Statements.

Most of the resolutions are routine matters which appear at each AGM, but I would like to draw shareholders' attention in particular to Resolution 14. This concerns the "discontinuation" of the Company. Every fifth year, shareholders are asked to vote on whether the Company should continue as currently constituted. This vote will be structured as a special resolution for "discontinuation", whereby the Company will continue in operation unless more than 75% of those voting elect to "discontinue". This unusual structure means that shareholders who wish the Company to continue should vote against the resolution. The Directors have considered the opportunities available to the Company and the resources and investment track record of the Investment Manager and are unanimously of the view that the Company should continue in operation. We therefore recommend that shareholders vote against Resolution 14 at the AGM as those Directors who hold shares intend to do themselves.

Outlook

The world is going through a difficult period as governments and central banks strive to control inflation. In setting interest rates, central banks continue to wrestle with the dilemma that higher rates may help to control inflation but at the same time reduce growth. Having increased interest rates significantly to protect the currency, the Vietnamese central bank has now reduced rates decisively to reduce the pressures in the real estate sector and help stimulate growth in domestic consumption.

The real estate sector in Vietnam has liquidity problems and, as one of the largest sectors in the Company's portfolio, these continue to be of concern. However, we do expect the situation to improve over time as there is a shortage of supply and pent-up demand, particularly for apartments in the major cities. Elsewhere, there is evidence that manufacturers are beginning to receive increased orders and Foreign Direct Investment remains strong. After slower growth in 2023, there are reasons to be optimistic that GDP growth in Vietnam will return to historic levels next year.

While during 2023 the equity market has recovered some of the ground lost in 2022, listed Vietnamese equities are still trading at a low valuation compared with regional peers and their own past levels. With the usual caveat that returns are likely to be volatile and buffeted by extraneous events, combining the low valuation with continued economic growth gives cause for optimism for Vietnamese equities. It is hoped that the recent elevation of the relationship between Vietnam and the United States to a Comprehensive Strategic Partnership will yield significant economic benefits over time.

As the Company looks to the future, the Board believes that Vietnam will continue to offer interesting and rewarding investment opportunities for patient, long-term investors and, particularly in light of this year's discontinuation vote, we thank you for your continued support.

Huw Evans

Chairman

VinaCapital Vietnam Opportunity Fund Limited

23 October 2023

INVESTMENT MANAGER'S REPORT - 30 JUNE 2023

Macroeconomic Highlights

Vietnam's economy grew by 8% in its 2022 post-COVID-19 re-opening boom, being one of the fastest-growing economies in Asia in 2022. However, from a financial year perspective, for the twelve-month period ending 30 June 2023, economic growth and market performance should be viewed in two separate and distinct periods reflecting differing economic and market conditions.

The first half of the financial year, from 30 June 2022 to 31 December 2022 saw a significant decline in corporate debt issuance and public equity trading liquidity which negatively affected the stock market and company performance. While there were several arrests of business leaders during 2022, it was the surprising arrest of Madame Truong My Lan, the owner and controller of many real estate holdings and the largest private bank in Vietnam, that exacerbated the market decline, particularly in the real estate sector.

The second half of the financial year, from 1 January 2023 to 30 June 2023 saw market liquidity and stock market performance recover, with government support across various parts of the economy, including the reduction of policy interest rates, the revision of corporate bond regulations, and other measures to help the real estate sector. While certainly more can be done with regards to improving capital market regulations and real estate policies, the improvements to the sector coupled with the Government support during the second half of the financial year were meaningful and diverted significant capital out of idle bank deposits and into the capital markets.

Vietnam's GDP grew by 9.5% year-on-year from 30 June to 31 December 2022, in contrast to the stock market which declined by 16.3%, in USD total return terms. In the second half of the Company's financial year from 1 January to 30 June 2023, the stock market staged a partial recovery, rising by 12.2% during the six-month period. However, Vietnam's GDP growth slowed to 3.7% year-on-year, reflecting a drop in manufacturing output and exports, a slow recovery in international tourist arrivals, and ongoing issues with real estate project approvals that are dampening sentiment and spending by local consumers.

Despite Vietnam's disappointing GDP growth in the first half of calendar year 2023, we believe that the worst of the country's economic downturn has passed given that exports and manufacturing appear to have now bottomed, while the government's twin policy drives of boosting infrastructure spending and lowering interest rates should support the country's economic growth. 

Vietnam's economy has been impacted by the slow-down in the US and European economies which collectively account for nearly half of Vietnam's total exports. The weak demand for "Made in Vietnam" products in 2023 was not unexpected, given the surge of inventories at US retailers last year, leading them to reduce and/or cancel orders. The growth of manufacturing output in Vietnam fell from 9.7% y-o-y in the first half of calendar year 2022 to 0.4% in the first half of calendar year 2023, knocking more than 2% points off Vietnam's GDP growth rate. However, it appears that consumer electronics inventories may have already passed the bottom, as evidenced by two months (June and July 2023) of month-on-month growth in Vietnam's exports of laptops and other consumer electronics. We expect orders for factories producing high-tech products in Vietnam to recover further in the remainder of calendar year 2023.

Another significant driver of GDP is foreign tourist arrivals, which have now recovered to about 70% of pre-COVID-19 levels. However, Chinese tourists, who previously accounted for 30% of foreign tourist arrivals in Vietnam pre-COVID-19, have not returned in a meaningful way despite China's reopening earlier this year. Historically, tourism has contributed about 8% of Vietnamese GDP and any further recovery in tourism will be a strong positive for Vietnam's growth looking ahead.

Crackdown on corporate bond issuances have impacted the Real Estate sector and impacted stock markets

Towards the end of calendar year 2022, we saw some major political changes with the replacement of two Deputy Prime Ministers and in January 2023 the resignation of Vietnam's President. While there may yet be further changes and investigations, we do not expect these to have a significant negative long-term impact on the economy and stock market. Rather, these changes should be positive for the investment environment and economy over time.

The headline arrests of some business leaders for the misuse of funds raised through the issuance of corporate bonds caused a decline in markets in the second half of calendar year 2022. The cost of debt increased substantially causing significant difficulties for corporate issuers to access new funding or roll-over expiring debt. In addition, the government issued a revised decree around the issuance of corporate bonds making it more difficult for private individuals to invest. At one stage during November 2022 the yields for some corporate bonds in the real estate sector were driven up to 30-40%. Most issuers had to step in either to purchase their outstanding bonds and/or renegotiate existing terms and tenors. This liquidity crunch particularly impacted real estate developers as well as hitting overall market confidence. As concerns grew over several large real estate developers' ability to access credit, in particular Novaland (HOSE: NVL, NAV: 3.3%) and Phat Dat Real Estate (HOSE: PHR, not held), the stock market began to fall in October and the resulting pressure from margin calls led to large falls in share prices. Investors, especially retail investors, were unnerved and the public equity markets recorded a significant decline during the final quarter of 2022.

The arrests led to concerns over the security of deposits at Saigon Commercial Bank (SCB). Faced with the potential for a run on the banks, the government sought the help of Vietinbank (CTG), the third largest State-Owned Commercial Bank, to oversee SCB and instil confidence by increasing its deposit rates. Consequently, other banks increased their deposit rates in order to retain customer deposits.

In 2022, the US Fed hiked rates by 425 basis points (bps), prompting the State Bank of Vietnam ("SBV") to hike policy interest rates twice last year. Unlike the rate increases in other economies, the increases in policy rates in Vietnam were not in response to hot inflation numbers, given Vietnam's inflation in 2022 and into 2023 was low, hovering between 2.0% and 4%, but were to defend and stabilise the USD-VND exchange rate.

The tightening of liquidity, particularly during the last quarter of 2022 and which persisted into early 2023 kept local deposit rates at around 9-10%. This, coupled with a stable currency against a strengthening USD resulted in Vietnamese depositors and businesses leaving money in the bank rather than investing into shares or real estate.

The net result was that the corporate bond market has effectively been closed for most of 2023. Lending conditions remain tight for real estate developers as banks are reluctant to extend more credit to developers during this period of uncertainty. It seems that this "liquidity crunch" is isolated to real estate developers, rather than being a system-wide issue as lending to manufacturers and other corporates continues. However, while interest rates were high there was little motivation to invest in capital equipment to expand businesses when orders for "Made in Vietnam" goods were weak.

Falling interest rates and improving credit liquidity should act as a positive signal for the real estate and banking sectors, and for the equity market in general.

 Real Estate sector recovery will be slow and gradual

Although liquidity has improved and interest rates have declined, pain is still being felt by many real estate businesses, particularly those that borrowed aggressively in the bond market. Cash flows of these companies are weak, needing debt agreements to be restructured.

The relationships between banks and real estate developers issuing bonds are very close. Most of the corporate bonds are distributed through commercial banks with some bonds being backed by banks, whether directly with collateral, or indirectly through a promise to be market makers of these instruments. Inevitably, banks involved in corporate bonds have been negatively impacted. One of the Company's largest holdings, Asia Commercial Bank (HOSE: ACB, NAV: 12.7%) does not have significant exposure to real estate corporate bond activities and continues to see steady earnings growth through its focus on small and medium enterprise businesses, and retail customers.

The real estate sector contributes about 10% of GDP and made up approximately 19% of the stock market weight average. The sector fell by 33.1% during the financial year, compared with the VN Index which declined by 6.1% in USD total return terms ($TR)6. The challenges discussed above have meant that there has been very little construction and few project sales during the first six months of the calendar year 2023. We see signs that the situation will improve in 2024 and into 2025.

A recovery in the real estate sector would make a significant contribution to Vietnam's GDP growth next year, especially since the demand for new housing units far outstrips the supply of newly constructed apartments and homes.

VOF has provided funding to three real estate developers which defaulted or are at risk of default in their repayment obligations. Restructuring efforts for these investments are discussed in more detail below.

6 An alternative performance measure: see Glossary.

Public spending will be a key driver of growth

Public spending will be a key driver for Vietnam's economy in 2024 and we expect that the government will continue to boost investment to help to offset the negative impact of the slowdown in exports and production. Infrastructure spending has grown by 40% over the first six months of 2023 compared with the same period last year and could reach over USD20 billion this year. In addition, a USD5 billion subsidy programme for affordable housing purchases has been introduced. Together these government initiatives could help boost 2023 GDP growth by about 1% point.

FDI continues to be resilient

Finally, Vietnam will continue to be a prime destination for FDI7, particularly for multinationals looking to produce for export and seeking an alternative manufacturing base to China. Vietnam has been the biggest beneficiary of the US-China trade war because of its low wages, proximity to Asian supply chains, and its geo-politically aligned "friend-shoring" appeal, which means that it has minimal risk of facing high tariffs from the US. These factors have drawn multinationals to invest in Vietnam and increased its exports in recent years, especially of high-tech products.

7See Glossary

Improving economic outlook as policy measures take effect

While many of the challenges that we have discussed above still remain, it now appears that more fundamental drivers introduced in recent months are finally having a positive effect. Globally, inflation appears to be moderating in developed markets, and the US Fed appears to be taking a less aggressive stance on monetary policy. Domestically, a sense of calm is settling in as the real estate sector improves and there are signs of a return to stability, although any robust recovery is likely to take some time. Interest rates were reduced earlier than anticipated, while supportive measures for the corporate bond and real estate market were introduced to help further strengthen the recovery in the real estate sector.

We believe that all of these factors will contribute to confidence returning to the economy and market.

Market Highlights

Vietnam's stock market experienced one of the most volatile years in its history during 2022 and ended the calendar year down by 34.1% in USD, total return terms ($TR). However, we are reporting over the financial year period ending 30 June 2023 and, as such, it is useful to look at the performance of the market over two distinct periods, with the first between July and December 2022, and then the second half of the financial year, from January to June 2023.

With the cost of debt rising significantly on the back of rising global interest rates and with other domestic challenges, investor confidence has remained weak, and this is clearly reflected in market liquidity which has declined from its peak levels. That said, the market liquidity remains robust and has improved in recent months.

Market liquidity and participation improves

During 2023, with green shoots across the field, domestic retail investors found some confidence to return to the market. In June 2023, the market saw the highest level of market turnover in a year, with average daily turnover up +36% month-on-month, to USD723.0 million (for the VN Index). Overall, the average daily trading volume in Vietnam's three exchanges has increased from USD400 - USD500 million during late 2022 to over USD1 billion on several occasions during the summer of 2023.

Calendar year-to-date, foreign investors are still net buyers in the market to the tune of some USD83 million, as flows increase from ETF mandates that originate from regional markets. Foreign buying activity has been concentrated in brokers (i.e., non-bank financial sector), with USD118.0 million net buying during the first half of the calendar year, reflecting the view that brokers will be a natural proxy to capture the stock market momentum for the remainder of the year.

The lowering of deposit rates has encouraged retail investors to return to the stock market, with new account openings reaching 146,000 in June 2023, after an impressive 105,000 new accounts opened in May, 4.6 times higher than April levels. As retail investor participation continues to grow, we have seen total stock margin lending balances of brokers increase 22% quarter-on-quarter as of 30 June 2023, estimated to be USD6.3 billion - albeit around 25% lower than the peak levels.

Valuations remain appealing

Vietnam remains attractively valued. On prospective financial year ("FY") 2023 earnings, PER8 and EV/EBITDA multiples are all well below their 5-year averages.

Our research team believes that the macroeconomic picture for Vietnam remains remarkably strong and resilient long-term. While earnings growth for 2023 has been trending lower, with consensus estimates currently at 7.8% growth for 2023, looking ahead the outlook for 2024 is robust, with the market expecting to deliver 32.1% earnings growth, one of the fastest growth rates in ASEAN, while still attractively priced at an estimated 12.3x forward price-to-earnings ratio for 2023.

While it is now encouraging to see improvements in both the policy cycle (lower rates, low inflation, stable currency, increased public spending), and the sentiment cycle (higher trading volumes, improved liquidity, rising valuations), we will nevertheless continue to monitor the recovery in the business cycle and the impact on earnings and economic growth as it relates to the investment opportunities that we seek for the Company.

8 See Glossary

Fund Performance Highlights

Over the long term, we expect the economic performance of Vietnam to drive investment returns and our approach to managing the Company's portfolio seeks to take advantage of this economic growth. However, over the year under review, Vietnam's economy has been affected by volatility in global markets, exacerbated by domestic issues in the real estate market.

For the year ended 30 June 2023, the NAV per share of the fund declined by -0.4% in USD, total return terms ($TR).

Historical long-term performance remains positive despite short-term challenges over the past financial year

While the VN Index is not a benchmark for the Company, it serves as a useful comparison for some investors.. Over the same 12-month period, the VN Index declined by 6.1% ($TR). Over the first half of the financial year, the VN Index declined by 16.3%, while over the second half of the financial year from January to June 2023, the VN Index increased by 12.2%. Importantly, over a 3-year and 5-year period, the fund has delivered +50.1% and +45.0% total returns respectively, versus +40.1% and 23.1% for the VN Index. The Company's share price total return over the same periods are -3.1% (12-months), +44.2% (3-year) and +44.1% (5-year).

Table: VOF and VN Index performance, up to 30 June 2023.

Source: Bloomberg, VinaCapital.

Dividends and Share Buyback

During the financial year, the Company received USD13.7 million in dividends from its portfolio companies and, in return, the Company continues to maintain its dividend policy and reward its shareholders with regular dividend pay-outs equivalent to approximately 1% of NAV every half year. Dividends paid totalled USD23.0 million for the financial year. The Company continues to be the only Vietnam dedicated listed closed-ended fund to pay a regular dividend.

In addition to dividends, the Company's share buyback programme remains active and during the financial year, the Company bought back USD18.2 million worth of shares and, since the commencement of the buyback program in 2011, the Company has bought (and cancelled) a cumulative total of 163 million shares, equivalent to approximately USD458 million that has been spent on the share buyback programme since its introduction.

Financial sector was the leading contributor to market performance, followed by Healthcare

The best performing sectors over the financial year were Healthcare (+21.9%), followed by Financial Services (+13.5%), and Energy (+5.1%). The Financial Services sector has the largest sector weight in the index - 38.1% - and, on a weighted contribution basis, was the leading contributor to market performance, contributing 5.8% to index performance.

The outlook for the Financial Services sector and, within it, the commercial banks, is enhanced by the SBV's recent accommodative monetary policy and borrowing rates at commercial banks have reduced by 250 bps in 2023 to date. Furthermore, the SBV have reaffirmed their desire to see higher credit growth for the year as part of their economic support measures, raising the credit growth limits for commercial banks by 14% year-on-year. This means that if credit is fully extended out into the economy, there may be a total of approximately USD70 billion of new credit disbursed in calendar year 2023. Note that by 30 June 2023, banks reported just 4.7% year-to-date credit growth, which points to a robust rate of credit disbursement for the remainder of the year even if commercial banks choose not to fully utilise their allotments.

The largest holding in the portfolio, ACB (NAV 12.7%), one of Vietnam's leading commercial banks, was the second largest contributor to the Company's annual performance, with ACB delivering a +8.5% return during the period and contributing almost +1.0% to total NAV performance.

The best performing sector for the VN Index over the financial year was the Healthcare sector (+21.9%), led mostly by several domestic pharmaceutical companies. However, given the sector's index weight of just 0.7%, on a weighted contribution basis, it delivered 0.2% contribution to the overall index performance. The Company's portfolio, through our Private Equity investments, has 8.4% NAV weight to the Healthcare sector, demonstrating that the portfolio gives investors an off-index allocation to some of the most exciting and growth-oriented segments of the domestic economy.

The only other sector in the VN Index that contributed a positive performance during the financial year was the Energy sector, up 5.1%, but owing to the sector's modest index weight, on a weighted contribution basis, added just 0.1% to the index performance. The Energy sector within the portfolio performed well during the period, with PVS (+37%) showing strong positive returns and helping to narrow the portfolio's losses during the market volatility.

On a weighted contribution basis, Financial Services delivered +1.3% to total return, while the Energy sector added +0.5% to the Company portfolio return over the financial year.

Real Estate was one of the worst performing sectors and largest detractor to market performance

As discussed above, the Real Estate sector was one of the worst performing sectors in the market, down 27.5% over the financial year period, and only second to the Consumer Discretionary sector, which was the worst performing, down by 28.4% over the same period. However, as the Real Estate sector is the second largest constituent of the VN Index, at 19.2% weight on average, it contributed the most in holding back market performance, and on a weighted contribution basis, took away 6.8% from the overall market performance during the financial year, offsetting any of the gains made by the top three sectors.

The Real Estate sector had the biggest negative impact on the portfolio, with a decline of 10% during the financial year, due to the valuation adjustments made to the several unquoted investments held in the sector, and the performance of some of the publicly listed Real Estate investments in the portfolio. On a weighted contribution basis, the Real Estate sector detracted -2.9% from the overall fund performance. Within the sector, KDH (-11%), VHM (-12%), NVL (-10%), DXS (-14%) were the biggest underperformers during the financial year.

Closely aligned to the fortunes of the Real Estate sector is the Construction Materials sector which over the financial year, declined by 6.5%. With the sector's 7.4% index weight, on a weighted contribution basis, this detracted 0.6% from the overall index return. However, within the individual companies within the Materials sector, performance was led by Hoa Phat Group (HOSE: HPG, NAV: 11.3%), the largest steel producer in Vietnam, which saw its share price increase by 17.3% over the financial year, with much of the gain over the January to June 2023 period, during which the price increased by 45.3%. HPG saw its strongest year-to-date monthly sales volume increase in June, up by 2.7% month-on-month to 640,000 tonnes, thanks to a combination of strong recovery in domestic demand and improved export volume growth. Quarter-on-quarter sales volume growth reached 11.4% to 1.8 million tonnes sold, delivering a net profit of USD43.0 million (+152% quarter-on-quarter). Consensus estimates for the full calendar year 2023 indicate that HPG should be able to deliver approximately USD315.0 million in net profit as a result of a strong improvement in sales volume, margin expansion thanks to cheaper input costs, and higher utilisation rates from their factories as all blast furnaces (several of which had been shut due to weak demand over the past year) should now all be back online.

Given the Materials sector performance, led by HPG, the fund's position in HPG delivered a +15.9% return during the period and contributed almost +1.5% to total NAV performance.

Illiquidity in the corporate bond market, a sizable wall of maturing bonds facing many developers and the inability to secure loans all lead to concerns. While mortgage rates have reduced in recent months, demand and buyer sentiment remain weak which will limit the recovery of the sector in the short term.

However, a recent report from CBRE research indicates that transaction volumes in Ho Chi Minh City and Hanoi condominiums have seen a pick-up in demand with 46% and 12% quarter-on-quarter growth in the second quarter of 2023, respectively, equivalent to 2,200 units in HCMC and 1,400 units in Hanoi sold during the quarter. The easing of interest rates and a clearer impact from the government's directives to support the sector (e.g., attempts to untie the legal knots that entangle project approvals, as well as easing restrictions on credit flow), all point to a gradual recovery for the real estate sector that may commence in the second half of the year, and then continue in 2024 and 2025.

Policy measures to stimulate and support the real estate market appear to be taking effect. This follows an aggressive deleveraging within the sector in late 2022, as described above. We are certainly not out of the woods yet, and it remains a tough year for pre-sales for real estate developers, which is a leading indicator of subsequent profitability performance. Delays in the legal approvals for projects and weak market sentiment have also deterred developers from new project launches, limiting the prospects for future growth.

Valuation adjustments to privately negotiated investments

In addition to the quoted investments in the portfolio, the Company had made a number of investments in private instruments issued by public companies ("PEPT") in the Real estate sector.

This year, the valuations of these investments have received particular scrutiny following defaults or potential for default by the counterparties. When the investments were originally made, the Investment Manager negotiated "downside protections" in the form of put options to the sponsor, as well as other rights, supplemented by collateral in the form of shares. With the turmoil in the real estate market at the end of 2022, however, it was not clear how these protections would take effect in the event of a default.

The Company has the following PEPT investments with NovaGroup:

Other PEPT investments include Dat Xanh Services (DXS) and Hung Thinh Land (HTL), with which renegotiations to extend payment terms have also now been concluded.

In November 2022, the carrying values of all of these investments were reduced by USD26.2 million. When the Board prepared the 31 December 2022 interim accounts in March 2023, with the prospect of further events of default, the valuations of these investments were reviewed again and a further reduction of USD26.7 million was made.

Over the past six months, progress has been made in renegotiating terms and the Board has approved a revaluation of these unquoted investments totaling USD26.8 million as at 30 June 2023. The carrying values of these investments are still below their original cost and expected returns and we continue to work with the counterparties with a view to obtaining a full recovery of the original investment and contractual returns. Without downside protections in the above investments, we would have experienced much larger losses.

"Traditional" private equity investments

As part of the year-end processes, the Board engages KPMG, an independent firm, to value the traditional private equity investments. A number of these have done well, particularly those in the Healthcare sector as it recovers from COVID-19. Over a total of five investments, Thu Cuc International Hospital, Tam Tri Medical, In Holdings, Chicilon Media and Hung Vuong Corporation, an uplift on value of USD27.5 million as at 30 June 2023 has been approved.

Investment Activities

While the investment team has spent a considerable amount of time resolving the existing investments that have been impacted by the downturn in the real estate market, activity continues with investments and the pipeline remains robust and interesting.

During the last financial year, USD179 million worth of transactions were executed in aggregate across the Public Equity and Private Equity portfolios, with USD65 million in investments and USD114 million in divestments. We highlight some of these below.

Chicilon Media: Investment into Vietnam's leading digital advertising infrastructure platform

We have long sought to increase our exposure to the digital communications and consumer sector, and specifically companies that benefit from the rising awareness and increasing sophistication in consumer behaviour, thanks to a wider recognition of international and domestic brands. In early February we announced that we had made a private equity investment into Chicilon Media, Vietnam's leading digital advertising platform. VinaCapital led a consortium to invest USD38 million, of which the Company invested USD31 million. As is typical in our private equity investments, we will receive one board seat and have privately negotiated terms of investment.

Founded in 2006, Chicilon Media's LCD screens are located in the lifts and lobbies of residential and commercial buildings across Vietnam, reaching the growing urban middle class, the most-prized target audience for both local and global consumer brands. The company has consistently delivered double-digit revenue growth on average and has remained profitable, even during the pandemic. Following the post-COVID-19 reopening of the economy, Chicilon Media has seen a strong recovery of its business, as evidenced by its net profit quadrupling in 2022 year-on-year. When Chicilon Media launched, there were nine building lift advertising companies in the market; today, there are only two, with Chicilon Media being four times the size of its closest competitor in terms of market share.

Chicilon Media is an ideal example of the type of market-leading company which we like to invest in. It is well-established and linked to sectors that are benefitting from Vietnam's growing middle class and strong domestic consumption story. Its management team have a clear vision and strategy, are experienced, and recognise the need to innovate in their business. In addition to currently leading the market, they also evolve with it by investing in advanced equipment and have a strong commitment to research and development.

IN Holdings / IN Dining: additional investment

The GEM Centre recently won Vietnam's best convention centre award conferred by the World MICE Awards9. The GEM Centre is one of the most prominent event and conference centres in HCMC and has held events for companies such as Amazon, Samsung, IBM, and Lexus. It is the flagship asset in a portfolio of centres that forms part of our investment in IN Holdings, one of the leading convention, banquet, and hospitality groups in Vietnam. We invested into IN Holdings in 2020 and, while the period during the pandemic was difficult, the team was able to keep all locations operating and now, post-pandemic, business performance is improving.

In June 2023, VOF increased its investment in IN Holdings, helping them to acquire a significant portfolio of restaurants from NovaGroup as part of the negotiations discussed above. These restaurants included regional restaurant brands Crystal Jade, JUMBO Seafood, Sushi Tei, and Gloria Jeans Coffee, as well as several home-grown brands. This expansion into food and beverages has seen the creation of IN Dining and we have appointed senior members to the management and operations team, including a new CEO and financial controller to help turn-around and grow this platform.

9 Part of the World Travel Awards (MICE is an acronym for Meetings, Incentives, Conferences and Exhibitions)

Tam Tri Medical platform expansion through a roll-up strategy

In December 2022, we completed the roll-up of two of the hospital platforms in the private equity portfolio, with Thai Hoa International Hospital now integrated into the larger platform of Tam Tri Medical. This merger has created a platform for 970 in-patient beds, spread across Vietnam including in HCMC, Danang, Nha Trang, and Dong Thap. The healthcare sector has experienced a compound annual growth rate of 10% since 2017 which is expected to continue in the future, and our platform specifically targets the rising middle-income class in Vietnam where demand for private healthcare is rapidly growing.

Subsequent to the financial year end, Tam Tri Medical has further expanded with the acquisition of two additional hospitals, one in Quang Nam in the central region of the country, and a significant hospital located near the international airport in Ho Chi Minh City, approximately 8-10km from the city centre. This expansion will bring on additional capacity to the Tam Tri Medical system over the coming years.

Investment Strategy and Liquidity

The Company's private approach to investing, whether it be public or private market opportunities, is what sets the Company apart from other funds that focus on Vietnam. When we invest, we always try to protect the investment on the downside. As we have seen over the past financial year, in times of market turmoil or in instances where the counterparty is unable to honour their commitments to us, we are able to use the downside protections and legally enforceable terms to seek the best possible returns.

Today, the size of the Company is an important factor which allows us to deploy large, meaningful amounts into investment opportunities. This is important as it demonstrates: (1) our conviction in the company we are investing in; (2) the size and scale of the company is large enough that it will attract interest from other investors; (3) the size of the investment, and the investment returns need to "move the dial" in terms of investment returns; and (4) the effort to negotiate, carry out due diligence, monitor and exit investments consumes roughly the same amount of time and effort whether large or small.

Rather than having to seek liquidity directly on the stock market, VOF seeks to negotiate positions of entry, whether they be into private companies where we take significant minority stakes, or into publicly listed companies, where the investment manager can participate in private placement opportunities or negotiate large blocks of shares in off-market transactions or have terms of investment not generally available to investors in the stock market.

ESG Reporting and Voting

VinaCapital published its first Annual ESG Report 2022 which can be found on VinaCapital's website vinacapital.com/esg/.

As with last year's Annual Report, this year we have included a discussion of our Responsible Investment approach and principles in the Corporate Governance Statement of the Annual Report where a more complete picture of both the Board and Investment Manager's commitments to ESG is discussed.

It is helpful to reiterate VinaCapital's commitment to adopting and implementing the United Nations-supported PRI, which VinaCapital believes is in the best long-term interests of its investors and portfolio companies, and which contributes to a more long-term oriented, transparent, sustainable, and well-governed investment market. We take a pragmatic approach to adopting ESG in our investment activities, while realising the limitations of investing in a developing market. We therefore focus less on screening companies solely on ESG issues, and more on stewardship activities where we believe a patient timeframe and active engagement can improve outcomes. This is further reflected in our approach to voting and ensuring that we actively participate in voting across our portfolio companies.

For publicly listed companies, VinaCapital has implemented a rigorous framework to assess ESG risks and encourage companies to improve their practices when warranted. Our portfolio managers, and in-house ESG and research teams regularly engage with management on ESG policies and practices. The discussions around ESG revolve around our proprietary framework of over 200 questions, that cover 17 areas of focus, including management and corporate structure; business ethics; energy, water, pollution, waste management, and greenhouse gas emissions; biodiversity; employee related issues such as wages, health, employment conditions; and community impacts.

Currently our research team has made over 100 assessments of publicly listed companies, including the majority of those held in the VOF public equity portfolio.

Voting Activities

As stewards of our investors' capital, we systematically engage with our investee companies on ESG matters. Our engagement takes various forms including voting, direct discussions with management, and educational initiatives.

As part of VinaCapital's Voting Policy that applies to the funds that VinaCapital manages, a core principle is that we seek to actively participate and vote, directly or through voting, on all resolutions. We will generally exercise the voting rights for resolutions associated with the following matters:

During the year up to June 2023, all 26 investments held in the VOF portfolio held their AGM. This included public and private companies, where we are pleased to report that 100% of resolutions raised by companies held in our portfolio were voted on. Of the 216 resolutions that we voted on, we abstained or voted against 12 of these resolutions, while we supported the remaining 204 resolutions.

The largest category of resolutions that we voted on concerned ESG. This category predominately captures resolutions that relate to the "Governance" element of ESG, including for example: the appointment and removal of board members, and members of the supervisory committee; appointment of external auditors; or amendments to the company charter and internal policies. There were very few resolutions tabled by the portfolio companies that relate to Environmental or Social matters, perhaps a reflection of the stage of immaturity of this developing market in addressing these concerns.

Conclusion

For investors who have confidence in the long-term growth potential for the market, valuations are attractively priced and are below historical averages. The investment team at VinaCapital looks forward to the future with optimism.

I would like to express my sincere thanks to our diligent and dedicated investment team who have worked tirelessly through this past period of volatility and challenges, as well as the unwavering support and guidance of our independent board of directors. Most importantly, I thank our shareholders who remain invested and have entrusted us to carry out the execution of our strategy to deliver long-term performance in this exciting, yet challenging emerging market we invest in.

Andy Ho

Managing Director and Chief Investment Officer

23 October 2023

VINACAPITAL MANAGEMENT TEAM

Don Lam

Group Chief Executive Officer

Don Lam is a founding partner of the Investment Manager and has more than 20 years' experience in Vietnam. He has overseen the Investment Manager's growth from the manager of a single USD10 million fund in 2003 into a leading investment management and real estate development firm in Southeast Asia, with a diversified portfolio of more than USD3 billion in assets under management. Before founding the Investment Manager, Mr Lam was a partner at PricewaterhouseCoopers (Vietnam), where he led the corporate finance and management consulting practices throughout the Indochina region. Additionally, Mr Lam set up the VinaCapital Foundation whose mission is to empower the children and youth of Vietnam by providing opportunities for growth through health and education projects. He is active in the World Economic Forum and is a member of several business task forces and committees in Vietnam. He has a degree in Commerce and Political Science from the University of Toronto and received an honorary doctorate from the Royal Melbourne Institute of Technology Vietnam. He is a Chartered Accountant and is a member of the Institute of Chartered Accountants of Canada. He also holds a Securities Licence in Vietnam.

Brook Taylor

Chief Executive Officer, VinaCapital Asset Management

Brook Taylor is the Chief Executive Officer of the Investment Manager. Mr Taylor has more than 20 years of management experience, including more than eight years as a senior partner with major accounting firms. Previously, he was deputy managing partner of Deloitte in Vietnam and head of the firm's audit practice. He was also managing partner of Arthur Andersen Vietnam and a senior audit partner at KPMG. Mr Taylor has lived and worked in Vietnam since 1997. Mr Taylor's expertise spans a broad range of management and finance areas including accounting, business planning, audit, corporate finance, taxation, and risk management. He holds an Executive MBA from INSEAD and a Bachelor of Commerce and Administration from Victoria University of Wellington.

Andy Ho

Managing Director and Group Chief Investment Officer

Andy Ho is Managing Director and Group Chief Investment Officer of the Investment Manager, where he oversees the capital markets, fixed income and private equity investment teams. Previously, Mr Ho was Director of Investment at Prudential Vietnam's fund management company, where he managed the capital markets portfolio and Prudential's investment strategy. He has also held management positions at Dell Ventures (the investment Company of Dell Computer Corporation) and Ernst & Young. Mr Ho is a leading authority on capital markets investment, privatisations, and private equity deals and structures in Vietnam, where he has led private placement deals totalling almost USD1 billion. He holds an MBA from the Massachusetts Institute of Technology and is a Certified Public Accountant in the United States.

Dieu Phuong Nguyen

Deputy Managing Director

Dieu Phuong joined VinaCapital in 2005 and is responsible for the Company's private equity investments and deal sourcing. Ms Phuong has led several private equity and private placement investments for the Company and holds board positions at several of the Company's investee companies including Khang Dien House (HOSE: KDH). Ms Phuong has previous experience at KPMG Vietnam where she covered international and local banks and holds a BA from the Banking University of Vietnam and is a fellow member of the ACCA (UK).

Khanh Vu

Deputy Managing Director

With over eleven years at VinaCapital, Khanh Vu is responsible for the Investment Manager's capital markets, portfolio management, investor relations and communication activities for the Company. He is also an active member of the fund's Investment Committee, involved in deal sourcing, investment execution and monitoring. Mr Vu has over 15 years of investment experience and has been based in Vietnam for the last nine years. Mr Vu has held managerial positions in corporate finance, asset management, investment banking, and professional services. Prior to VinaCapital, he was at Macquarie Bank based in New York and Sydney, with his last posting on the buy-side infrastructure asset management team. Prior to that, he held various positions with Deloitte & Touché and Arthur Andersen, based in Sydney. Mr Vu holds both master's and bachelor's degrees from the University of New South Wales, Sydney, and a Graduate Diploma of Applied Finance granted by the Financial Services Institute of Australia where he is a Fellow.

Michael Kokalari

Chief Economist

Michael Kokalari, CFA serves as VinaCapital's Chief Economist, and is responsible for providing thought leadership and technical acumen on a wide range of global and local macroeconomic issues with a view to maximising the firm's investment performance. Mr Kokalari has worked in Vietnam for nine years, and was previously the Head of Research at CIMB Securities Vietnam, and the CIO of Saigon Asset Management. Earlier in his career, Mr Kokalari was a derivatives trader in Tokyo & London where he ran multi-billion dollar trading books for Lehman Brothers, JP Morgan Chase, Credit Suisse First Boston, BNP Paribas and West LB. Mr Kokalari co-authored the CFA guide to Credit Derivatives, and was a contributor to "Risk Management: Foundations for a Changing Financial World" (published in 2010), along with Nobel Prize winners Myron Scholes and William Sharpe of Stanford University. Mr Kokalari holds an MS Engineering in Computational Mathematics from Stanford University, an MS Mathematics from Stanford, an MS Management from the Graduate School of Business at Stanford, and a BA Mathematics from Clark University, where he was a Gryphon and Pleiades Scholar.

BOARD OF DIRECTORS

Huw Evans

Non-executive Chairman (Independent)

(Appointed 27 May 2016)

Huw Evans qualified in London as a Chartered Accountant with KPMG (then Peat Marwick Mitchell) in 1983. He subsequently worked for three years in the Corporate Finance Department of Schroders before joining Phoenix Securities Limited in 1986. Over the next twelve years he advised a wide range of companies in financial services and other sectors in the UK and overseas on mergers and acquisitions and more general corporate strategy. Since moving to Guernsey in 2005 he has acted as a Director of a number of Guernsey based companies and funds. He returned to the UK in 2023 and is now UK resident. He holds an MA in Biochemistry from Cambridge University.

Peter Hames

Non-executive Director (Independent)

(Appointed 24 June 2021)

Peter Hames spent 18 years of his investment career in Singapore, where in 1992 he co-founded Aberdeen Asset Management's Asian operation and, as director of Asian Equities, he oversaw regional fund management teams responsible for running a number of top-rated and award-winning funds. Peter is a former director of Polar Capital Technology Trust plc. and Syncona Ltd (formerly BACIT Ltd). Peter is also an independent member of the operating board of Genesis Investment Management, LLP and is a director of The Genesis Emerging Markets Investment Company.

Julian Healy

Non-executive Director (Independent)

(Appointed 23 July 2018)

Julian Healy has over thirty years' experience of banking, private equity and investment management in emerging and frontier markets. He holds an MA in Modern Languages from Cambridge University and is a member of the Institute of Chartered Accountants in England and Wales. He has been a non-executive director of a number of companies and financial institutions in emerging markets.

Kathryn Matthews

Non-executive Director (Independent)

(Appointed 10 May 2019)

Kathryn Matthews has been involved in financial services for the last 40 years. Her last executive role was as Chief Investment Officer, Asia Pacific (ex-Japan), for Fidelity International. Prior to that, Kathryn held senior appointments with William M Mercer, AXA Investment Managers, Santander Global Advisers and Baring Asset Management. She has previously been on the Board of Directors of a number of investment companies including Fidelity Asian Values and JPMorgan Chinese Investment Trust. She is currently on the Board of JPMorgan Asia Growth and Income Fund, British International Investment Ltd and is Chairman of Barclays Investment Solutions Ltd.

Hai Thanh Trinh

Non-executive Director (Independent)

(Appointed 30 June 2022)

Hai Thanh Trinh has over 35 years' business experience, having held various managerial and senior executive positions at financial services institutions in Vietnam and in the United States including Indochina Capital, New York Life and BAOVIET Insurance Group. Prior to joining the Company, he used to serve as an Independent Director at Saigon Hanoi Commercial Bank, and An Binh Commercial Bank. He currently also serves as Independent Director and Chairman of the Audit Committee of Van Phu Invest, a listed real estate developer in Vietnam. He holds an MBA in Finance and Investment from The George Washington University, a FFSI (Fellow of LOMA Financial Services Institute) and a LLIF granted by LIMRA Leadership Institute and The Wharton School (University of Pennsylvania).

Thuy Bich Dam retired from the Board with effect from 18 April 2023.

DISCLOSURE OF DIRECTORSHIPS IN OTHER PUBLIC COMPANIES LISTED ON RECOGNISED STOCK EXCHANGES

The Board is required to declare any potential conflicts at each meeting. During the year, no Director reported any potential conflicts that may affect their independence.

CORPORATE GOVERNANCE STATEMENT

The Board is responsible for strategy and has established an annual programme of agenda items under which it reviews the objectives and strategy for the Company.

To comply with the UK Listing Regime, the Company must comply with the requirements of the UK Code. The Company is also required to comply with the Guernsey Code. The Company is a member of the AIC and by complying with the AIC Code, the Company is deemed to comply with both the UK Code and the Guernsey Code. The Board has considered the Principles and Provisions of the AIC Code. The AIC Code addresses the Principles and Provisions set out in the UK Code, as well as setting out additional Provisions on issues that are of specific relevance to the Company as an investment company. The Board considers that reporting against the Principles and Provisions of the AIC Code, which has been endorsed by the Financial Reporting Council and the Guernsey Financial Services Commission provides relevant information to shareholders. The AIC Code is available on the AIC website (www.theaic.co.uk). It includes an explanation of how the AIC Code adopts the Principles and Provisions set out in the UK Code to make them relevant for investment companies.

The UK Code includes provisions relating to the role of the chief executive, executive directors' remuneration and the need for an internal audit function. For the reasons set out in the AIC Code, and as explained in the UK Corporate Governance Code, the Board considers that these provisions are not relevant to the Company, being an externally managed investment company. The Company has therefore not reported further in respect of these provisions.

The Board is of the view that throughout the year ended 30 June 2023 the Company complied with the recommendations of the AIC Code. Key issues affecting the Company's corporate governance responsibilities, how they are addressed by the Board and application of the AIC Code are presented below.

Provision 1 of the AIC Code requires the annual report to set out the following information:

There is no information that is required to be disclosed under Listing Rule 9.8.4.

Section 172 Statement

Section 172 of the UK Companies Act applies directly to UK domiciled companies. Nonetheless, the intention of the AIC Code is that the matters set out in section 172 are reported on by all London listed investment companies, irrespective of domicile, provided that this does not conflict with local company law.

Section 172 states that: A director of a company must act in the way he or she considers, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole, and in doing so have regard (amongst other matters) to the six items (a) to (f) in the table below. A summary of relevant activities is also included in the table:

Purpose

The Company is an investment company and its purpose is to provide non-Vietnamese investors with the opportunity to achieve medium to long-term returns through investment in Vietnam.

Culture and Values

The Directors' overarching duty is to promote the success of the Company for the benefit of investors, with due consideration of other stakeholders' interests. The Company's approach to investment is explained in the Investment Manager's Report. The Board applies various policies and practices to ensure that the Board's culture is in line with the Company's purpose, values and strategy. The Directors aim to achieve a supportive business culture combined with constructive challenge.

The Company has a number of policies and procedures in place to assist with maintaining a culture of good governance including those relating to diversity, conflicts of interest, and dealings in the Company's shares. The Company's policy is to have zero tolerance of corruption, bribery and tax evasion either by the Company and its officers or by its suppliers.

The Board assesses and monitors compliance with these policies regularly through Board meetings and the annual evaluation process. The Board seeks to appoint the most appropriate service providers for the Company's needs and evaluates the services on a regular basis. The Board considers the culture of the Investment Manager and other service providers through regular reporting and by receiving regular presentations as well as through ad hoc interaction.

The Board also seeks to control the Company's costs, thereby enhancing performance and returns for the Company's shareholders. The Directors consider the impact on the community and environment.

ESG

The Board takes a close interest in ESG issues. It receives regular reports from the Investment Manager on the development of best practice in Vietnam and on the Investment Manager's approach to ESG. It also receives reports on engagement with individual investee companies. As management of the portfolio is delegated to the Investment Manager, the practical implementation of policy rests with the Investment Manager. A description of the Investment Manager's approach to ESG issues is set out below and examples of how the Investment Manager carries out their ESG due diligence are included in the Investment Manager's Report.

Investment Manager's Approach to Responsible Investing

Responsible investing has been and continues to be a core tenet of VinaCapital's investment philosophy and process. VinaCapital, as a firm, has long recognised that ESG issues can have a significant impact on value creation across the investment cycle. The Investment Manager has adopted a Responsible Investment policy to formalise its approach to incorporating environmental, social, and corporate governance considerations across its investment activities. In developing this policy, VinaCapital has considered a range of codes and standards, including the United Nations-supported PRI, the IFC's Performance Standards on Environmental and Social Sustainability, and its internal policies.

As more institutional investors invest into Vietnam and Vietnamese businesses expand, ESG related matters have taken on greater importance. In recent years, the Investment Manager has witnessed situations in which shareholder value declined significantly when businesses polluted the environment, ignored global standards, relocated families from land without paying adequate compensation, or did not adhere to international best practices with respect to corporate governance.

VinaCapital has developed a framework to identify ESG risks at potential investee companies, and helps businesses improve their practices, where appropriate, by incorporating ESG terms as part of its overall terms of investment in private opportunities. VinaCapital engages expert advisors and consultants to evaluate ESG risks as part of its due diligence activities prior to investing, as well as monitoring any applicable remediation actions post-investment.

VinaCapital has committed to adopting and implementing the PRI, which VinaCapital believes is in the best long-term interests of its investors, and which contributes to a more long-term oriented, transparent, sustainable, and well-governed investment market. While VinaCapital aims to adopt best practices of ESG in its investment activities and at its portfolio companies, VinaCapital also takes a pragmatic approach, recognising the limitations of investing in developing markets. VinaCapital therefore focuses less on screening companies solely on ESG issues, and more on stewardship activities where VinaCapital believes a patient timeframe and active engagement can improve outcomes.

VinaCapital believes ESG considerations materially impact long term value creation and has therefore integrated ESG considerations into the investment decision making process. This is typically done through a combination of screening and active stewardship, where possible. As stewards of its investors' capital, VinaCapital systematically engages with its investee companies on ESG matters. VinaCapital's engagement

takes various forms including voting, direct discussions with management, and educational initiatives, among others.

Specifically, ESG forms a core part of the due diligence and investment activities that the Company carries out, particularly when it comes to making private equity investments, as this is an area in which VinaCapital can exert influence within its portfolio companies. Through its private equity investment approach, VinaCapital has an opportunity to carry out ESG due diligence using external consultants, or through its in-house ESG expertise.

The due diligence review typically identifies weaknesses relative to local and international standards. Such weaknesses do not necessarily deter the Company from making an investment but rather provide a clear roadmap for improvement. Importantly, with the recommendations for change, VinaCapital can gauge whether a sponsor is motivated to make these improvements to their business. VinaCapital feels that the greatest value added to the business and in society comes from the motivation for change and the actions that a company takes to improve ESG weaknesses and, thus, VinaCapital gravitates more towards these types of opportunities and sponsors.

For publicly listed companies, VinaCapital has implemented a rigorous framework to assess ESG risks and encourage companies to improve their practices when warranted.

Currently VinaCapital's research team has made over 100 assessments of publicly listed companies, including those held in the Company's public equity portfolio. VinaCapital applies this evaluation to the listed part of the Company's portfolio to determine the weighted average results of the portfolio at the current point in time. With this understanding, VinaCapital can set a benchmark as to where it will like Company's portfolio to be in the next twelve to twenty-four months. Actions such as encouraging management teams to make impactful improvements or divesting holdings that rank poorly by ESG standards will be taken to achieve VinaCapital's objectives.

Investment Manager's Approach to Voting

As stewards of its investors' capital, VinaCapital systematically engages with its investee companies on governance and voting matters. VinaCapital's engagement takes various forms including voting, direct discussions with management, and education initiatives, among others.

As part of VinaCapital's Voting Policy that applies to all funds that VinaCapital manages, a core principle is that VinaCapital seeks to actively participate and vote, directly or through proxy voting, on all resolutions.

VinaCapital has published its ESG Policy on VinaCapital's website and encourages investors to review the policies and principles that guide VinaCapital's approach to responsible investing and stewardship.

Stakeholders

The Company is an externally managed investment company whose activities are all outsourced. It does not have any employees. The Board has identified its key stakeholders, and how the Company engages with them, in the table below:

While portfolio investments are not stakeholders in the conventional sense, the Board acknowledges its responsibility to ensure where possible that investee companies adhere to good standards of conduct with regard to their own stakeholders. In some cases, the Investment Manager may have the capacity to affect these matters directly; in others, the scale of the Company's investment gives it the ability to influence the management of its investee holdings.

Relations with Shareholders

The Company aims to provide shareholders with a full understanding of the Company's investment objective, policy and activities, its performance and the principal investment risks by means of informative annual and half year reports. This is supplemented by the publication by the Investment Manager of a monthly fact sheet, both daily and weekly estimates of the NAV per share and a regular series of video presentations, all of which are available on the Company's website (https://vof.vinacapital.com).

A detailed analysis of the substantial shareholders of the Company and a report from the Corporate Broker on investor sentiment and industry issues is provided to the Directors at each Board meeting. The Chairman and representatives of the Investment Manager are available to meet shareholders to discuss strategy and to understand any issues and concerns which they may have. The results of such meetings are reported at the following Board meeting.

Shareholders wishing to communicate with the Chairman, the SID or any other member of the Board, may do so by writing to the Company, for the attention of the Company Secretary, at the Registered Office. The Directors welcome the views of all shareholders and place considerable importance on communications with them.

The Annual General Meeting of the Company provides a forum for shareholders to meet and discuss issues with the Directors of the Company.

Re-election and Tenure of Directors

As set out in the AIC Code, Directors submit themselves for annual re-election and in any event as soon as it is practical after their initial appointment to the Board. The Board has adopted a formal policy requiring that Directors should stand down at the AGM following the ninth anniversary of their initial appointment.

The individual performance of each Director standing for re-election has been evaluated by the other members of the Board and a recommendation will be made to shareholders to vote in favour of their re-election at the AGM.

Board Proceedings and Relationship with the Investment Manager

The Chairman encourages open debate to foster a supportive and co-operative approach for all participants.

The Board meets formally six times each year and representatives of the Investment Manager are in attendance, when appropriate, at each meeting. During the year under review, the Board held two meetings in person with the Investment Manager in Vietnam and two in Europe. In addition two formal Board meetings were held during the year under review by video conference during which the portfolio and its performance was reviewed. Going forward, the Board will continue to arrange a combination of video conferences and meetings in person, while recognising the cost and the environmental impact of international travel.

The Board, at its regular meetings, undertakes reviews of key investment and financial data, revenue projections and expenses, analyses of asset allocation, transactions, share price and NAV performance, marketing and shareholder communication strategies, the risks associated with pursuing the investment strategy, peer company information and industry issues. In addition to the scheduled meetings, ad hoc meetings of the Board are held during the year to deal with any significant matters which arise which are attended by those directors who are available at the time.

The Board has agreed a schedule of matters specifically reserved for decision by the Board. This includes establishing the investment objectives, strategy and benchmarks, the permitted types or categories of investments, the markets in which transactions may be undertaken, the level of permitted borrowings, the amount or proportion of the assets that may be invested in any category of investment or in any one investment, and the Company's treasury share and share buyback policies. Representatives of the Investment Manager attend each meeting of the Board to address questions on specific matters and to seek approval for specific transactions which the Investment Manager is required to refer to the Board. The Board has delegated discretion to the Investment Manager to exercise voting powers in investee companies on the Company's behalf.

The Investment Manager is generally responsible for routine announcements of information but the Board is responsible for communications regarding major corporate issues.

The Directors have access to the advice and services of the Company Secretary, who is responsible to the Board for ensuring that the Directors are aware of the procedures to be followed. The Company Secretary is also responsible for ensuring good information flows between all parties.

At Board meetings the Company Secretary provides a report in which the Directors are given key information on the Company's regulatory and statutory requirements as they arise, including information on the role of the Board, matters reserved for its decision, the terms of reference for the Board Committees, the Company's corporate governance practices and procedures and the latest financial information. It is the Chairman's responsibility to ensure that the Directors have sufficient knowledge to fulfil their roles and Directors are encouraged to undertake training courses where appropriate.

Continued appointment of the Investment Manager

Following an annual appraisal carried out by the Management Engagement Committee, the Board considers that it is in the best interests of shareholders to continue with the appointment of VinaCapital Investment Management Ltd as the Investment Manager.

Board Committees

There are four Board committees in operation: the Audit Committee, Management Engagement Committee, Remuneration Committee and Nomination Committee. The chairmanship and membership of each Committee throughout the year, and the number of meetings held during the year, are shown in the table below. A summary of the duties of each of the Committees is provided below. The chairman of each Committee presents their findings to the Board at the next Board meeting following each Committee meeting.

The terms of reference of each committee can be obtained from the Company Secretary.

Audit Committee

The Audit Committee, which meets at least three times a year, comprises all of the Directors and is chaired by Julian Healy.

The Audit Committee is responsible for monitoring the process of production and ensuring the integrity of the Company's Financial Statements and advises the Board whether the Annual Report and Financial Statements are fair, balanced and understandable. The Audit Committee is also responsible for overseeing the relationship with the External Auditor and the Company's process for assessing and managing risk. The responsibilities and activities of the Audit Committee are set out in detail in the Report of the Audit Committee below.

Management Engagement Committee

The Management Engagement Committee comprises all of the Directors and is chaired by Kathryn Matthews. The Committee's responsibilities include reviewing the performance of the Investment Manager under the Investment Management Agreement and considering any variation to the terms of the agreement. The Management Engagement Committee also reviews the performance of the Company Secretary, Corporate Brokers, Custodian, Administrator, Registrar, other key service providers and any matters concerning their respective agreements with the Company.

Remuneration Committee

The Remuneration Committee comprises all of the Directors and is chaired by Peter Hames. The Committee's responsibilities include reviewing the ongoing appropriateness and relevance of the remuneration policy; determining the individual remuneration of the chairman and each non-executive director; and the selection and appointment of any remuneration consultants who advise the Committee.

The Directors' Remuneration Report is set out below.

Nomination Committee

The Nomination Committee comprises all of the Directors and is chaired by Huw Evans. The Committee's responsibilities include reviewing the structure, size and composition of the Board and making recommendations to the Board in respect of any changes; succession planning for the Chairman and the remaining non-executive directors; making recommendations to the Board concerning the membership and chairmanship of the Board committees; identifying and nominating for the approval of the Board candidates to fill Board vacancies; and, before any new appointment is recommended, evaluating the balance of skills, knowledge, experience and diversity within the Board and preparing an appropriate role description. The Committee will seek to ensure that for any recruitment process a suitably diverse list of candidates is considered. The Company's policy is that in making appointments it will seek to avoid any discrimination based on age, gender, ethnicity, sexual orientation, disability or educational, professional and socio-economic backgrounds. The Chairman absents himself from discussions on succession to his own role.

Board Composition

As at the date of this report the Board consists of five non-executive directors, each of whom is independent of the Investment Manager. No member of the Board is a Director of another investment company managed by the Investment Manager, nor has any Board member been an employee of the Company, its Investment Manager or any of its service providers.

Julian Healy was appointed as the SID on 2 December 2021. The SID provides shareholders with someone whom they can contact if they have concerns which cannot be addressed through the normal channels. The SID is also available to act as an intermediary between the other Directors and the Chairman (if required). The role serves as an important check and balance in the governance process.

The Board reviews the independence of the Directors at least annually.

Board Diversity

The Board believes that each Director has appropriate qualifications, industry experience and expertise to guide the Company and that the Board as a whole has an appropriate balance of skills, experience, background and knowledge. As at the date of this report, the Board comprises four men and one woman. One of the directors is Vietnamese and resident in Vietnam. The Directors' biographies can be found within the Board of Directors section. The gender identity and ethnic background reporting as at 30 June 2023 is provided below.

Note: Listing Rule 9.8.6R(11): 'As the Board consists of five individuals the data in the above table was reviewed by each of the individual board members'

As an externally managed company, the Company does not have any employees. The Board acknowledges the importance of diversity for the effective functioning of the Board which helps create an environment for success and effective decision making. The Board is aware of the recommendations of the Hampton Alexander Review on gender diversity and the Parker Review on ethnic diversity and inclusion on company boards. At present the board does not meet the target on gender diversity but does meet the target on ethnic diversity. Prior to the appointment of Mr Hai Trinh and the subsequent retirement of Ms Thuy Dam, the board did meet the target on gender diversity. The board's decision to appoint Mr Hai Trinh was on the basis that he was the strongest candidate available to fill the vacancy. As the Board is made up wholly of non-executive directors it only has two roles which are classed in the UK Listing Rules as "senior", namely the Chairman and Senior Independent Director. At present neither of these roles is filled by a female director. The Board is focused on addressing all of the relevant targets and, through its Nomination Committee, will keep these matters under regular review and will take account of the targets when appointing further board members in the future.

Appointment of New Directors

The Board seeks to ensure that any vacancies arising are filled by the best qualified candidates. The Board's policy is that the Company's Directors should bring a wide range of skills, knowledge, experience, backgrounds and perspectives to the Board. All appointments are made on merit, and in the context of the skills, knowledge and experience that are needed for the Board to be effective. Part of the remit of the Board's Nomination Committee is, before any new appointment is recommended, evaluating the balance of skills, knowledge, experience and diversity within the Board.

For new appointments to the Board, nominations are sought from the Directors and from other relevant parties, and independent search consultants are appointed when appropriate. Candidates are then interviewed by members of the Nomination Committee. The Board has a breadth of experience relevant to the Company, and the Directors believe that any changes to the Board's composition can be managed without undue disruption. Any incoming Directors of the Company participate in a full, formal and tailored induction programme.

 Board and Committee Meetings

During the year ended 30 June 2023, the number of scheduled Board and Committee meetings attended by each Director was as follows:

1 Thuy Bich Dam retired on 18 April 2023.

Meetings of the Management Engagement Committee, Remuneration Committee and Nomination Committee were held on 6 October 2023. In addition to the scheduled meetings noted above, a number of ad hoc Board and Committee meetings were held during the year which were attended by those Directors available at the time.

Board Performance

The Board has a formal process to evaluate its own performance and that of its Chairman annually. The provisions of the AIC Code require a FTSE 350 company to have its annual evaluation carried out in conjunction with an independent agency every three years and a review was carried out in 2022 by an external evaluator, Lintstock Ltd. During the year under review an internal assessment was conducted by the Directors. This review raised no issues of significance, and the Board was satisfied that the structure, mix of skills and operation of the Board continue to be effective and relevant for the Company.

Internal Controls and Risk

(i) Risk Management System

Day to day management of risk is the responsibility of the Investment Manager, whose ERM framework provides a structured approach to managing risk across all of its managed funds by establishing a risk management culture through education and training, formalised risk management procedures, defining roles and responsibilities with respect to managing risk, and establishing reporting mechanisms to monitor the effectiveness of the framework. The Audit Committee works closely with the Investment Manager on the application, consideration and review of the ERM framework to the Company's risk environment.

Regular risk assessments and reviews of internal controls are undertaken by the Audit Committee. At each meeting, the Board considers both previously identified and emerging risks. The Administrator and Company Secretary and other service providers are also encouraged to provide their views on emerging risks. The reviews cover the strategic, investment, operational and financial risks facing the Company. In arriving at its judgement of the risks which the Company faces, the Board has considered the Company's operations in light of the following factors:

(ii) Internal Control Assessment Process

Responsibility for the establishment and maintenance of an appropriate system of internal control rests ultimately with the Board. However, the Board is dependent on the Investment Manager and other service providers to achieve this and a process has been established which seeks to:

· review the risks faced by the Company and the controls in place to address those risks;

· identify and report changes in the risk environment;

· identify and report changes in the operational controls;

· identify and report on the effectiveness of controls and errors arising; and

· ensure no override of controls by the Investment Manager or Administrator or any other service providers.

The key procedures which have been established to provide effective internal financial controls are as follows:

(iii) Risk Management

For the purposes of making the Viability Statement, the Board has undertaken a robust review of the principal risks and uncertainties facing the Company including those that would threaten its business model, future performance, solvency or liquidity. A risk matrix and heat map prepared by the Investment Manager and subject to detailed scrutiny by the Audit Committee are the key tools in this review, along with a mechanism at each quarterly Audit Committee meeting to consider and monitor any emerging risks. The principal risks are described in the following table together with a description of the mitigating actions taken by the Board.

China changed its policy on lock downs to control COVID-19 in October 2022, becoming the last major economy to do so. The Board and the Investment Manager remain aware of the risk of further pandemic outbreaks but the immediate risk to economic performance has reduced and the risk from COVID-19 is no longer considered to be a principal risk.

(iv) Internal Audit Function

The Audit Committee has reviewed the need for an internal audit function for the Company itself. The Committee has concluded that the systems and procedures employed by the Investment Manager and the Administrator, including their own internal audit functions, currently provide sufficient assurance that a sound system of internal control, which safeguards the Company's assets, is maintained. As all operations of the Company are outsourced to third parties, an internal audit function specific to the Company is therefore considered unnecessary. The Investment Manager has appointed KPMG Vietnam as its internal auditor and the Administrator has appointed KPMG Channel Islands Limited as its internal auditor.

Directors' Dealings

The Company has adopted a Code of Directors' Dealings in Securities.

International Tax Reporting

For purposes of the US Foreign Account Tax Compliance Act, the Company registered with the IRS as a Guernsey reporting FFI, received a Global Intermediary Identification Number (GUHZUZ.99999.SL.831), and can be found on the IRS FFI list.

The CRS is a global standard developed for the automatic exchange of financial account information developed by the OECD, which was adopted in Guernsey and which came into effect on 1 January 2016.

The Company made its latest report for CRS and FATCA to the Guernsey Director of Income Tax in June 2023. The Board ensures that the Company is compliant with Guernsey regulations and guidance in this regard.

Share Capital and Treasury Shares

The number of shares in issue at the year-end is disclosed in note 11 to the Financial Statements.

Directors' Interests in the Company

As at 30 June 2023 and 30 June 2022, the interests of the Directors in shares of the Company are as follows:

There have been no changes to any holdings between 30 June 2023 and the date of this report.

Substantial Shareholdings

As at 30 June 2023 and 30 September 2023, the Directors are aware of the following shareholders with holdings of more than 3% of the ordinary shares of the Company:

Going Concern and Viability Statement

Under the AIC Code and applicable regulations, the Directors are required to satisfy themselves that it is reasonable to assume that the Company is a going concern. The Directors have considered carefully the liquidity of the Company's investments and the level of cash balances as at the reporting date as well as reviewing forecast cash flows up to 31 December 2024. The Company has substantial assets and the Board monitors the liquidity of the portfolio to ensure that more than enough cash could be realised from asset sales to meet any unexpected liability over the period. The Company does have a modest credit facility which could easily be repaid were the need to arise.

An additional factor which the Directors have considered is the discontinuation vote which will be put to shareholders at the AGM in December 2023. If the resolution were to be passed, the Directors will be required to formulate proposals to be put to shareholders to reorganise, unitise or reconstruct the Company or for the Company to be wound up. The Board tabled such resolutions in 2008, 2013 and 2018 and on each occasion the resolution was not passed.

In seeking to ensure that shareholders retain confidence in the Company, the Investment Manager meets regularly with shareholders and has an active investor relations programme. In addition, the Chairman communicates independently with significant shareholders. The Directors cannot predict the outcome of the discontinuation vote in December and, therefore, recognise that a material uncertainty exists which may cast doubt on the ability of the Company to continue as a going concern. That having been said, the Directors currently have no indication that the resolution will be passed and, therefore, continue to adopt the going concern basis of accounting in preparing the annual financial statements.

The Company is exposed to many risks and uncertainties, the principal of which are listed in the Report of the Board of Directors. As noted, the Directors monitor and assess these risks on a regular basis as well as considering any other risks which emerge from time to time. The Directors confirm that they believe that their assessment of the principal risks facing the Company is robust and, for the purposes of complying with the AIC Code, that they have assessed the viability of the Company over the three years to 30 June 2026. The Directors consider this period sufficient given the inherent uncertainty of the investment world and the specific issues which the Company faces in investing in Vietnam.

As referred to above, a discontinuation vote will be put to shareholders at the AGM in December 2023. The directors have no reason to believe that the resolution will be passed and, in assessing the viability of the Company, have assumed that it will continue in its present form throughout the period of assessment.

The Directors, having considered the above risks and other factors, have a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the three-year period of their assessment.

REPORT OF THE BOARD OF DIRECTORS

The Board submits its Annual Report together with the Financial Statements of the Company for the year ended 30 June 2023.

The Company is a Guernsey domiciled closed-ended investment company. The Company is classified as a registered closed-ended Collective Investment Scheme under the Protection of Investors (Bailiwick of Guernsey) Law, 2020 and is subject to the Companies (Guernsey) Law, as amended (the "Guernsey Law"). Prior to March 2016 the Company was a limited liability company incorporated in the Cayman Islands.

The Company is quoted on the Main Market of the LSE with a Premium Listing (ticker: VOF).

The Company's investments continue to be managed by the Investment Manager.

Principal Activities

Through its investments in subsidiaries and associates, the Company's objective is to achieve medium to long-term returns through investment in assets either in Vietnam or in companies with a substantial majority of their assets, operations, revenues, or income in, or derived from, Vietnam.

Life of the Company

The Company does not have a fixed life but the Board considers it desirable that shareholders should have the opportunity to review the future of the Company at appropriate intervals. Accordingly, the Board intends that every fifth year a special resolution will be proposed that the Company ceases to continue. If the resolution is not passed, the Company will continue to operate as currently constituted. If the resolution is passed, the Directors will be required to formulate proposals to be put to shareholders to reorganise, unitise, or reconstruct the Company or for the Company to be wound up. The Board tabled such resolutions in 2008, 2013 and 2018 and on each occasion the resolution was not passed, allowing the Company to continue as currently constituted. The next such resolution will be put to shareholders in December 2023.

Investment Objective

The Company's objective is to achieve medium to long-term returns through investment in assets either in Vietnam or in companies with a substantial majority of their assets, operations, revenues, or income in, or derived from, Vietnam.

Investment Policy

All of the Company's investments will be in Vietnam or in companies with at least 75% of their assets, operations, revenues or income in, or derived from, Vietnam at the time of investment.

The Company may gear its assets through borrowings which may vary over time according to market conditions and any or all of the assets of the Company may be pledged as security for such borrowings. Borrowings will not exceed 10% of the Company's total assets at the time that any debt is drawn down.

From time to time the Company may hold cash or low risk instruments such as government bonds or cash funds denominated in either VND or USD, either in Vietnam or outside Vietnam.

Gearing

The Board sets the Company's policy on the use of gearing. The Company negotiated a USD40 million secured revolving credit facility with Standard Chartered Bank in March 2022 which was renewed for a further 12 month period in March 2023. The Investment Manager draws funds under the facility from time to time to manage the Company's cash balances and liquidity.

Valuation Policy

The accounting policy for valuations can be found in note 2.7 to the Financial Statements.

Key Performance Indicators

The Chairman's Statement and the Investment Manager's Report provide details of the Company's activities and performance during the year.

In light of the Company's Investment Objective, the KPIs used to measure the progress of the Company are:

? the movement in the Company's NAV total return;

? the movement in the Company's share price; and

? discount of the share price in relation to the NAV.

Information relating to the KPIs can be found in the Financial Highlights section.

A discussion of progress against the KPIs is included in the Chairman's Statement.

Distribution Policy

Dividend Policy

The Company intends to pay a dividend representing approximately 1% of NAV twice each year, normally declared in March and October.

The policy will be subject to shareholder approval at each annual general meeting.

Share Buybacks

The Company may also distribute capital by means of share buybacks when the Board believes that it is in the best interests of shareholders to do so. The share buyback programme will be subject to Shareholder approval at each annual general meeting.

Discount Management

The Board operates the share buyback programme in line with the objective of ensuring that the share price more closely reflects the underlying NAV per share.

The Board retains responsibility for setting the parameters for the discount management policy, for overseeing the management of the buyback programme and for ensuring that its policy is implemented. The Board intends to continue to seek to manage the discount through the continued use of share buybacks and active marketing of the Company. The Board's objective is to achieve a narrowing of the discount in a manner that is sustainable over the longer term. The Board and the Investment Manager consult regularly with shareholders and with the corporate broker with a view to assessing and improving the effectiveness of the buyback programme. Further comments on the buyback programme are set out in the Chairman's Statement.

Refer to note 11 of the Financial Statements for details of share buybacks during the year under review.

Subsequent Events after the Reporting Date

On 23 October 2023, the Board declared a dividend of 7.0 US cents per share. The dividend is payable on or around 4 December 2023 to shareholders on record at 3 November 2023.

On behalf of the Board

Huw Evans

Chairman

VinaCapital Vietnam Opportunity Fund Limited

23 October 2023

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Directors are responsible for preparing the Financial Statements for each financial year which give a true and fair view of the state of affairs of the Company and of its profit or loss for that year in accordance with IFRS and the Guernsey Law. International Accounting Standard 1 - Presentation of Financial Statements requires that financial statements present fairly for each financial period the Company's financial position, financial performance and cash flows. This requires the faithful representation of the effects of transactions, other events and conditions in accordance with the definitions and recognition criteria for assets, liabilities, income and expenses set out in the IASB's "Framework for the preparation and presentation of financial statements". In virtually all circumstances a fair presentation will be achieved by compliance with all applicable IFRS.

The Directors are also responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Company and to ensure that the Financial Statements have been prepared in accordance with the Guernsey Law and IFRS. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Directors are responsible for the oversight of the maintenance and integrity of the corporate and financial information in relation to the Company's website; the work carried out by the auditors does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may have occurred to the financial statements since they were initially presented on the website. Legislation in Guernsey governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

In preparing the Financial Statements the Directors are required to:

The Directors confirm that they have complied with these requirements in preparing the Financial Statements.

Responsibility Statement of the Directors in Respect of the Financial Statements

The Directors consider that the Annual Report and Financial Statements, taken as a whole, are fair, balanced and understandable and provide information necessary for shareholders to assess the Company's position, performance, business model and strategy. Each of the Directors confirms to the best of each person's knowledge and belief that:

a) the Financial Statements have been prepared in accordance with IFRS and give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company as at and for the year ended 30 June 2023; and

b) the Annual Report includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that the Company faces.

Directors' Statement

So far as each of the Directors is aware, there is no relevant audit information of which the Company's External Auditor is unaware, and each Director has taken all of the steps that they ought to have taken as a Director to make themselves aware of any relevant audit information and to establish that the Company's External Auditor is aware of that information. In the opinion of the Board, the Annual Report and Financial Statements taken as a whole, are fair, balanced and understandable and provide the information necessary to assess the Company's position, performance, business model and strategy.

On behalf of the Board

Huw Evans

Chairman

VinaCapital Vietnam Opportunity Fund Limited

23 October 2023

REPORT OF THE AUDIT COMMITTEE

On the following pages, we present the Report of the Audit Committee for the year ended 30 June 2023, setting out the Audit Committee's structure and composition, principal duties and key activities during the year. As in previous years, the Audit Committee has reviewed the Company's financial reporting, the independence and effectiveness of the External Auditor and the internal control and risk management systems of the service providers.

Structure and Composition

The Audit Committee is chaired by Julian Healy. All other Directors of the Company are members of the Audit Committee. Huw Evans, who is the Chairman of the Company, is a member of the Audit Committee but does not chair it. His membership of the Audit Committee is considered appropriate given his extensive knowledge of the Company and its investments. Julian Healy and Huw Evans are both Chartered Accountants.

Appointment to the Audit Committee is for an indefinite period provided that members remain independent of the Investment Manager and meet the criteria for membership of the Audit Committee.

The Committee conducts formal meetings at least three times a year. The table in the Corporate Governance Statement sets out the number of Audit Committee meetings held during the year ended 30 June 2023 and the number of such meetings attended by each Committee member. The External Auditor is invited to attend those meetings at which the audit plan for the year is reviewed and at which the annual and interim reports are considered. The External Auditor and the Audit Committee Chairman meet every year without the presence of either the Administrator or the Investment Manager and at other times if the Audit Committee deems this to be necessary.

Principal Duties

The role of the Audit Committee includes:

External Auditor

PwC CI was appointed as the External Auditor with effect from 24 May 2016 following the change of domicile of the Company from the Cayman Islands to Guernsey. The accounting year ended 30 June 2023 is therefore the eighth accounting year for which PwC CI has been the External Auditor.

The independence and objectivity of the External Auditor is reviewed by the Audit Committee, which also reviews the terms under which the External Auditor is appointed to perform any non-audit services. The Audit Committee has established policies and procedures governing the engagement of the External Auditor to provide non-audit services. These are that the External Auditor may not provide a service which:

? places them in a position to audit their own work;

? creates a mutuality of interest;

? results in the External Auditor functioning as a manager or employee of the Company; and

? puts the External Auditor in the role of advocate of the Company.

The audit and any non-audit fees proposed by the External Auditor each year are reviewed by the Audit Committee taking into account the Company's structure, operations and other requirements during the period and the Committee makes recommendations to the Board.

The Audit Committee has examined the scope and results of the external audit, its cost effectiveness and the independence and objectivity of the External Auditor, with particular regard to non-audit fees, and considers PwC CI as External Auditor, to be independent of the Company. The only non-audit activity carried out by PwC CI was the review of the Half Yearly Report. This activity is assurance related and the Committee believes that PwC CI is best placed to provide this service for the shareholders and that this does not compromise its independence.

The External Auditor is required to rotate the Audit Engagement Partner responsible for the Company's audit every five years. The accounting year to 30 June 2023 was the third year for which Evelyn Brady has been the Audit Engagement Partner.

Key Activities

The following sections discuss the principal assessments made by the Audit Committee during the year:

Risk Management

The Audit Committee received and reviewed detailed reports on the principal risks facing the Company from the Investment Manager. The Audit Committee's reviews focused on changes to the risks and also considered whether the Company was subject to any new or emerging risks, taking account of the views of the Investment Manager, of other service providers and of Committee members' own awareness of issues which may affect the Company. In the year under review, particular attention was paid to the key risks as described in the Corporate Governance Statement, namely risks under the headings: (i) geopolitical (ii) macroeconomic and market (iii) investment performance, (iv) operational, (v) fair valuation, (vi) legal and regulatory, (vii) changing investor sentiment and (viii) ESG.

Significant Financial Statement Issues

(a) Valuation of Investments

The Chairman of the Audit Committee and the Chairman of the Board committed a considerable amount of time to initial review and oversight of the valuations of investments throughout the year and particularly when considering valuations at the financial year-end. Their observations formed a key part of the Audit Committee's review of valuations.

In relation to the listed investments and unlisted investments where an active market exists, the Audit Committee confirmed that the Investment Manager has used the market values published by the relevant stock exchanges as at the Statement of Financial Position date.

In relation to the operating asset and private equity investments, the Audit Committee ensured that the Investment Manager and, where relevant, the Independent Valuer have applied appropriate valuation methodologies.

Members of the Audit Committee meet the Independent Valuer and the Investment Manager at least annually to discuss the valuation process. In seeking to determine the fair value of the Company's operating asset and private equity investments, the Committee reviews the reports from the organisations providing valuations along with the Investment Manager's valuation and recommendations. Each individual valuation is reviewed in detail and, where an Independent valuer has been retained, their recommendation may be accepted or modified. Refer to note 3 of the Financial Statements for further information on the valuation of investments held by the Company.

On two occasions during the year under review the Committee considered and recommended adjustments to the values of some of the Company's valuations which were additional to the normal half yearly reviews. These adjustments were agreed by the Board and communicated to shareholders via Stock Exchange announcements which were issued on 29 November 2022 and 10 March 2023.

The methodologies and valuations as at 30 June 2023 were discussed and subsequently approved by the Audit Committee in meetings with the Independent Valuer and the Investment Manager in September and October 2023. In these meetings, the Audit Committee challenged the unobservable inputs applied to projected future returns and in particular as to whether these take due account of the effects of heightened global inflation, macroeconomic and specific company and industry risks, as well as any possible effects of climate change.

The Independent Valuer and the Investment Manager were invited to justify the approach to these issues and confirmed that due account had been taken of the relevant risks.

The Audit Committee regularly reviews the movement in valuations year on year including sensitivity factors affecting the valuations.

(b) Calculation of the incentive fee and determination of fair value of the liability

The incentive fee is calculated by the Administrator, which is independent of the Investment Manager.

The Audit Committee sought assurance both that the incentive fee and associated accruals were correctly calculated in compliance with the investment management agreement and that an appropriate discount rate was used and correctly applied in arriving at the present value of incentive fees which may potentially be paid in future years, on the basis that the NAV remains constant. As in previous years, the Audit Committee instructed CES Investments Ltd to perform an independent, full review of the relevant calculations. Following this exercise, the Audit Committee was satisfied that the assumptions used were appropriate and the calculations were accurate.

Effectiveness of the Audit

The Audit Committee held formal meetings with PwC CI before the start of the audit to discuss formal planning, to discuss any potential issues, to agree the scope that would be covered and, after the audit work was concluded, to discuss the significant issues which arose.

Following evaluation, the Audit Committee was satisfied that there had been appropriate focus and challenge on the significant and other key areas of audit risk and assessed the quality of the audit to be good. The Audit Committee undertakes an evaluation of the performance of the External Auditor annually.

Audit fees and Safeguards on Non-Audit Services

The table below summarises the remuneration paid by the Company to PwC CI and to other PwC member firms for audit and non-audit services during the years ended 30 June 2023 and 30 June 2022.

The Audit Committee considers PwC CI to be independent of the Company. Further, the Audit Committee has obtained PwC CI's confirmation that the services provided by other PwC member firms to the wider VinaCapital organisation do not prejudice its independence with respect to its role as auditor of the Company.

Conclusion and Recommendation

On the basis of its work carried out over the year, and assurances given by the Investment Manager and the Administrator, the Audit Committee is satisfied that the Financial Statements appropriately address the critical judgements and key estimates (both in respect of the amounts reported and the disclosures). The Audit Committee is also satisfied that the significant assumptions used to determine the values of assets and liabilities have been appropriately scrutinised and challenged and are sufficiently robust. At the request of the Board, the Audit Committee considered and was satisfied that the 30 June 2023 Annual Report and Financial Statements, taken as a whole, were fair, balanced and understandable and that they provided the necessary information for shareholders to assess the Company's position, performance, business model and strategy.

The Investment Manager and the Administrator confirm to the Committee that they were not aware of any material misstatements including matters relating to the presentation of the Financial Statements. The Audit Committee confirms that it is satisfied that PwC CI has fulfilled its responsibilities with diligence and professional scepticism.

Following the review process on the effectiveness of the independent audit and the review of audit and non-audit services, the Audit Committee has recommended that PwC CI be reappointed for the coming financial year.

Julian Healy

Audit Committee Chairman

23 October 2023

DIRECTORS' REMUNERATION REPORT

Directors' Remuneration Policy

The Board's policy is that the remuneration of the independent non-executive Directors should reflect the experience and time commitment of the Board as a whole and is determined with reference to comparable organisations and available market information each year.

The non-executive Directors of the Company are entitled to such rates of annual fees as the Board at its discretion shall from time to time determine. In addition to the annual fee, under the Company's Articles of Association, if any Director is requested to perform extra or special services they will be entitled to receive such additional remuneration as the Board may think fit.

No component of any Director's remuneration is subject to performance factors.

The rates of fees per Director are reviewed annually, although these reviews will not necessarily result in any changes in remuneration. Annual fees are pro-rated where a change takes place during a financial year.

Limit on Aggregate Total Directors' Fees

At the AGM on 10 December 2018, a resolution was approved by shareholders to increase the maximum aggregate total remuneration to USD650,000.

Recruitment Remuneration Principles

1. The remuneration package for any new Chairman or non-executive Director will be the same as the prevailing rates determined on the basis set out above. The fees and entitlement to reclaim reasonable expenses will be set out in Directors' Letters of Appointment.

2. The Board will not pay any introductory fee or incentive to any person to encourage them to become a Director but may pay the fees of search and selection specialists in connection with the appointment of any new non-executive Director.

3. The Company intends to appoint only non-executive Directors for the foreseeable future.

Service Contracts

None of the Directors has a service contract with the Company. Non-executive Directors are engaged under Letters of Appointment and are subject to annual re-election by shareholders.

Loss of Office

Directors' Letters of Appointment expressly prohibit any entitlement to payment on loss of office.

Scenarios

The Chairman's and non-executive Directors' remuneration is fixed at annual rates, and there are no other scenarios where remuneration will vary unless there are payments for extra or special services in their role as Directors. It is accordingly not considered appropriate to provide different remuneration scenarios for each Director.

Statement of Consideration of Conditions Elsewhere in the Company

As the Company has no employees, a process of consulting with employees on the setting of the Remuneration Policy is not relevant.

Other Items of Remuneration

None of the Directors has any entitlement to pensions or pension-related benefits, medical or life insurance schemes, share options, long-term incentive plans, or performance-related payments. No Director is entitled to any other monetary payment or any assets of the Company except in their capacity (where applicable) as shareholders of the Company.

Directors' and Officers' liability insurance is maintained and paid for by the Company on behalf of the Directors. The Company has also provided indemnities to the Directors in respect of costs or other liabilities which they may incur in connection with any claims relating to their performance or the performance of the Company whilst they are Directors.

No Director was interested in any contracts with the Company during the year or subsequently other than in their role as a Director.

Review of the Remuneration Policy

The Board has agreed that there would be a formal review before any change to the Remuneration Policy is made; and, at least once a year, the Remuneration Policy will be reviewed to ensure that it remains appropriate.

Shareholder approval of the Directors' Remuneration Policy

An ordinary resolution for the approval of the Directors' Remuneration Policy was put to the shareholders at the AGM which was held on 5 December 2022. The results of this resolution were:-

The directors intend to put forward a further resolution for approval of the Directors' Remuneration Policy not later than the Company's AGM in 2025.

Directors' Remuneration Implementation Report

For the year ended 30 June 2023, Directors' individual annual remuneration was:

There are no long-term incentive schemes provided by the Company and no performance fees are paid to Directors.

Directors' Emoluments for the Year

The Directors over the past two years have received the following emoluments in the form of fees:

1 Steve Bates retired from his position as chairman of the Board on 2 December 2021.

2 Huw Evans was appointed chairman of the Board on 2 December 2021.

3 Thuy Bich Dam was appointed chairman of the Remuneration Committee and retired from the board on 18 April 2023.

4 Peter Hames was appointed chair of the Remuneration Committee on 10 May 2023.

5 Kathryn Matthews is the chair of the Management Engagement Committee.

6Hai Trinh was appointed as a member of the Board on 30 June 2022.

In addition, Directors were reimbursed for their expenses incurred in performance of their duties, including attendance at Board and Annual General Meetings.

Shareholder Approval of the Directors' Remuneration Implementation Report

An ordinary resolution for the approval of the Directors' Remuneration Implementation Report will be put to the shareholders at the AGM to be held on 6 December 2023. A similar resolution was put to the previous AGM in December 2022 and votes cast were as follows: -

Directors' Fees with effect from 1 October 2023

Vietnam is an emerging market where regulation of investment activities is at an early stage and the Investment Manager is inexperienced in the investment disciplines practiced in more developed markets. Each Director has experience in developed markets and the Board constantly seeks to use this experience to improve the processes operating within the Investment Manager. For its part, the Investment Manager recognises that this external influence will improve the professionalism of the investment process over time to the benefit of its broader business. The Directors have worked with the Investment Manager to improve the investment process in both listed and unlisted equities. Further, the Chairman of the Audit Committee and the company Chairman spend a considerable amount of time at each half-yearly report reviewing valuations of unlisted investments.

Each October, the directors attend the VinaCapital conference in Vietnam followed by meetings with the senior management of VinaCapital. The Board meets formally and holds an away day at which broader strategy matters are discussed. This series of meetings typically takes a week. In addition to this, the Chairman travels to Vietnam in March again to meet the VinaCapital team and to maintain the relationship with Hai Trinh. Individual members of the Board have also travelled to Vietnam in between Board meetings to address specific issues with the Investment Manager.

This degree of oversight means that the work load of individual directors is considerably higher than that for a typical investment company. With this in mind, the Remuneration Committee engaged an independent consultant, Stephenson Executive Search Limited, to review the directors' work load and remuneration. Taking account of the consultant's recommendations, the Board agreed the following levels of directors' remuneration with effect from 1 October 2023:-

On behalf of the Board

Peter Hames

Chair

Remuneration Committee

23 October 2023

Independent auditor's report to the members of VinaCapital Vietnam Opportunity Fund Limited

Report on the audit of the financial statements

Our opinion

In our opinion, the financial statements give a true and fair view of the financial position of VinaCapital Vietnam Opportunity Fund Limited (the "company") as at 30 June 2023, and of its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards and have been properly prepared in accordance with the requirements of The Companies (Guernsey) Law, 2008.

What we have audited

The company's financial statements comprise:

· the statement of financial position as at 30 June 2023;

· the statement of comprehensive income for the year then ended;

· the statement of changes in equity for the year then ended;

· the statement of cash flows for the year then ended; and

· the notes to the financial statements, which include significant accounting policies and other explanatory information.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing ("ISAs"). Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We are independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements of the company, as required by the Crown Dependencies' Audit Rules and Guidance. We have fulfilled our other ethical responsibilities in accordance with these requirements.

Material uncertainty related to going concern

We draw attention to note 2.2 to the financial statements which indicates that the company is due to hold a discontinuation vote at its Annual General Meeting in December 2023.This event or condition indicates that a material uncertainty exists that may cast significant doubt on the company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

Our audit approach

Overview

The scope of our audit

As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financial statements. In particular, we considered where the directors made subjective judgements; for example, in respect of significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain. As in all of our audits, we also addressed the risk of management override of internal controls, including among other matters, consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.

Key audit matters

Key audit matters are those matters that, in the auditor's professional judgement, were of most significance in the audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) identified by the auditor, including those which had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters, and any comments we make on the results of our procedures thereon, were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Material uncertainty related to going concern section, we have determined the matters described below to be the key audit matters to be communicated in our report.

This is not a complete list of all risks identified by our audit.

How we tailored the audit scope

We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial statements as a whole, taking into account the structure of the company, the accounting processes and controls, the industry in which the company operates, and we considered the risk of climate change and the potential impact thereof on our audit approach.

Materiality

The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality. These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures on the individual financial statement line items and disclosures and in evaluating the effect of misstatements, both individually and in aggregate on the financial statements as a whole.

Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

We use performance materiality to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds overall materiality. Specifically, we use performance materiality in determining the scope of our audit and the nature and extent of our testing of account balances, classes of transactions and disclosures, for example in determining sample sizes. Our performance materiality was 75% (2022: 75%) of overall materiality, amounting to USD 12.6 million (2022: USD 13.3 million) for the company financial statements.

In determining the performance materiality, we considered a number of factors - the history of misstatements, risk assessment and aggregation risk and the effectiveness of controls - and concluded that an amount at the upper end of our normal range was appropriate.

We agreed with the Audit Committee that we would report to them misstatements identified during our audit above USD 0.84 million (2022: USD 0.89 million) as well as misstatements below that amount that, in our view, warranted reporting for qualitative reasons.

Reporting on other information

The other information comprises all the information included in the Annual Report and Financial Statements (the "Annual Report") but does not include the financial statements and our auditor's report thereon. The directors are responsible for the other information.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report based on these responsibilities.

Responsibilities for the financial statements and the audit

Responsibilities of the directors for the financial statements

As explained more fully in the Statement of Directors' Responsibilities, the directors are responsible for the preparation of the financial statements that give a true and fair view in accordance with International Financial Reporting Standards, the requirements of Guernsey law and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or has no realistic alternative but to do so.

Auditor's responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

Our audit testing might include testing complete populations of certain transactions and balances, possibly using data auditing techniques. However, it typically involves selecting a limited number of items for testing, rather than testing complete populations. We will often seek to target particular items for testing based on their size or risk characteristics. In other cases, we will use audit sampling to enable us to draw a conclusion about the population from which the sample is selected.

As part of an audit in accordance with ISAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Use of this report

This report, including the opinions, has been prepared for and only for the members as a body in accordance with Section 262 of The Companies (Guernsey) Law, 2008 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

Report on other legal and regulatory requirements

Company Law exception reporting

Under The Companies (Guernsey) Law, 2008 we are required to report to you if, in our opinion:

? we have not received all the information and explanations we require for our audit;

? proper accounting records have not been kept; or

? the financial statements are not in agreement with the accounting records.

We have no exceptions to report arising from this responsibility.

Corporate governance statement

The Listing Rules require us to review the directors' statements in relation to going concern, longer-term viability and that part of the corporate governance statement relating to the company's compliance with the provisions of the UK Corporate Governance Code specified for our review. Our additional responsibilities with respect to the corporate governance statement as other information are described in the Reporting on other information section of this report.

The company has reported compliance against the 2019 AIC Code of Corporate Governance (the "Code") which has been endorsed by the UK Financial Reporting Council as being consistent with the UK Corporate Governance Code for the purposes of meeting the company's obligations, as an investment company, under the Listing Rules of the FCA.

Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the corporate governance statement is materially consistent with the financial statements and our knowledge obtained during the audit, and we have nothing material to add or draw attention to in relation to:

· The directors' confirmation that they have carried out a robust assessment of the emerging and principal risks;

· The disclosures in the Annual Report that describe those principal risks, what procedures are in place to identify emerging risks and an explanation of how these are being managed or mitigated;

· The directors' statement in the financial statements about whether they considered it appropriate to adopt the going concern basis of accounting in preparing them, and their identification of any material uncertainties to the company's ability to continue to do so over a period of at least twelve months from the date of approval of the financial statements;

· The directors' explanation as to their assessment of the company's prospects, the period this assessment covers and why the period is appropriate; and

· The directors' statement as to whether they have a reasonable expectation that the company will be able to continue in operation and meet its liabilities as they fall due over the period of its assessment, including any related disclosures drawing attention to any necessary qualifications or assumptions.

Our review of the directors' statement regarding the longer-term viability of the company was substantially less in scope than an audit and only consisted of making inquiries and considering the directors' process supporting their statements; checking that the statements are in alignment with the relevant provisions of the Code; and considering whether the statement is consistent with the financial statements and our knowledge and understanding of the company and its environment obtained in the course of the audit.

In addition, based on the work undertaken as part of our audit, we have concluded that each of the following elements of the corporate governance statement is materially consistent with the financial statements and our knowledge obtained during the audit:

· The directors' statement that they consider the Annual Report, taken as a whole, is fair, balanced and understandable, and provides the information necessary for the members to assess the company's position, performance, business model and strategy;

· The section of the Annual Report that describes the review of effectiveness of risk management and internal control systems; and

· The section of the Annual Report describing the work of the Audit Committee.

We have nothing to report in respect of our responsibility to report when the directors' statement relating to the company's compliance with the Code does not properly disclose a departure from a relevant provision of the Code specified under the Listing Rules for review by the auditors.

Evelyn Brady

For and on behalf of PricewaterhouseCoopers CI LLP

Chartered Accountants and Recognised Auditor

Guernsey, Channel Islands

23 October 2023

The Financial Statements were approved by the Board of Directors on 23 October 2023 and signed on its behalf by:

Huw Evans Julian Healy

Chairman Director

The accompanying notes are an integral part of these Financial Statements.

STATEMENT OF CHANGES IN EQUITY

The accompanying notes are an integral part of these Financial Statements.

STATEMENT OF COMPREHENSIVE INCOME

All items were derived from continuing activities.

The accompanying notes are an integral part of these Financial Statements.

STATEMENT OF CASH FLOWS

The accompanying notes are an integral part of these Financial Statements.

1. GENERAL INFORMATION

The Company registered on 22 March 2016 as a closed-ended investment scheme with limited liability under the Guernsey Law. The Company is registered in Guernsey with registration number 61765. Prior to that date the Company was incorporated in the Cayman Islands as an exempted company with limited liability.

The Company is classified as a registered closed-ended Collective Investment Scheme under the Protection of Investors (Bailiwick of Guernsey) Law 2020 and is subject to the Guernsey Law.

The Company's objective is to achieve medium to long-term returns through investment either in Vietnam or in companies with a majority of their assets, operations, revenues or income in, or derived from, Vietnam.

On 30 March 2016, the Company's shares were admitted to the Main Market of the LSE with a Premium Listing under the ticker symbol VOF. Prior to that date, the Company's shares were traded on the AIM market of the LSE.

The Company does not have a fixed life, but the Board considers it desirable that shareholders should have the opportunity to review the future of the Company at appropriate intervals. Accordingly, the Board intends that every fifth year a special resolution will be proposed that the Company ceases to continue. If the resolution is not passed, the Company will continue to operate as currently constituted. If the resolution is passed, the Directors will be required to formulate proposals to be put to shareholders to reorganise, unitise or reconstruct the Company or for the Company to be wound up. The Board tabled such resolutions in 2008, 2013 and 2018 and on each occasion the resolution was not passed, allowing the Company to continue as currently constituted.

The Financial Statements for the year ended 30 June 2023 were approved for issue by the Board on 23 October 2023.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these Financial Statements are set out below. These policies have been consistently applied to all years presented, unless otherwise stated.

Statement of Compliance

The Financial Statements have been prepared in accordance with IFRS, which comprise standards and interpretations approved by the IASB together with applicable legal and regulatory requirements of the Guernsey Law.

2.1 Basis of preparation

The Financial Statements have been prepared using the historical cost convention, as modified by the revaluation of financial assets at fair value through profit or loss, and financial liabilities at fair value through profit or loss. The Financial Statements have been prepared on a going concern basis.

The preparation of Financial Statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires judgement to be exercised in the process of applying the Company's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the Financial Statements, are disclosed in note 3.

2.2 Going concern

Under the AIC Code and applicable regulations, the Directors are required to satisfy themselves that it is reasonable to assume that the Company is a going concern. The Directors have considered carefully the liquidity of the Company's investments and the level of cash balances as at the reporting date as well as reviewing forecast cash flows up to 31 December 2024. 

An additional factor which the Directors have considered is the discontinuation vote which will be put to shareholders at the AGM in December 2023. If the resolution were to be passed, the Directors will be required to formulate proposals to be put to shareholders to reorganise, unitise or reconstruct the Company or for the Company to be wound up. The Board tabled such resolutions in 2008, 2013 and 2018 and on each occasion the resolution was not passed,

In seeking to ensure that shareholders retain confidence in the Company, the Investment Manager meets regularly with shareholders and has an active investor relations programme. In addition, the Chairman communicates independently with significant shareholders. The Directors cannot predict the outcome of the discontinuation vote in December and, therefore, recognise that a material uncertainty exists which may cast doubt on the ability of the Company to continue as a going concern. That having been said, the Directors currently have no indication that the resolution will be passed and, therefore, continue to adopt the going concern basis of accounting in preparing the annual financial statements.