Circular No. 10/1999/TT-BTC provides temporary guidelines on financial management for Securities Trading Centers

CIRCULAR

Interim Guidelines on Financial Management for Securities Trading Centers.

 Pursuant to Decree No. 178/CP dated October 28, 1994 of the Government stipulating the tasks, powers, and organizational structure of the Ministry of Finance;

Pursuant to Decree No. 48/1998/NĐ-CP dated July 11, 1998 of the Government on securities and the securities market;

Pursuant to Decision No. 127/1998/QĐ-TTg dated July 11, 1998 of the Prime Minister on the establishment of the Securities Trading Center;

The Ministry of Finance hereby provides guidelines on financial management applicable to the Securities Trading Center as follows:

I. GENERAL PROVISIONS.

1. The Securities Trading Center is a public service entity with revenue under the State Securities Commission, having legal personality, its own office, seal, and separate account.

2. The Securities Trading Center's operational expenses are guaranteed by the State Budget. The establishment of funds at the Center shall be based on the revenues generated from its activities.

3. The Securities Trading Center collects various fees and charges in accordance with the regulations of the competent authority.

4. All income and expenditures arising at the Securities Trading Center must be reflected in Vietnamese Dong. If transactions occur in foreign currency, they must be converted into Vietnamese Dong according to the exchange rate published by the inter-bank market at the time of the transaction.

5. The Securities Trading Center implements quarterly and annual financial revenue and expenditure plans in accordance with state financial regulations; it conducts accounting and settlement of financial revenues and expenditures in accordance with the Accounting and Statistics Ordinance and current state accounting regulations.

II. SPECIFIC PROVISIONS.

1. Sources of funding for the operation of the Securities Trading Center:

a) Operational funding from the State Budget:

- The portion of the operational funding of the Securities Trading Center provided by the State Budget annually shall be implemented in accordance with current regulations on budget planning, execution, and settlement, and specific guidance provided in this Circular.

- Any grants or aid from domestic and foreign organizations and individuals to the Center shall be managed as if they were allocations from the State Budget.

b) Fees collected at the Center:

- Membership fees paid by member securities companies.

- Listing fees paid by issuing companies listed at the Center.

- Transaction fees paid by parties involved in securities trading activities at the Center.

- Registration and custody fees for securities paid by the owners of securities.

- Settlement fees for securities transactions conducted at the Center.

- Information service fees paid by users of the Center's services and other fees as prescribed by the competent authority.

c) Other income generated during operations outside the above categories: interest on deposits for the income mentioned in point b; other income (if any). during the course of operation, in addition to the revenues specified above: interest on deposits for the revenues under sub-item b; other revenues (if any).

2. Expenditures of the Securities Trading Center: The expenditures of the Securities Trading Center include:

Salary and allowances;

- Contributions to social insurance, health insurance, and other payments required by state regulations;

- Travel expenses;

- Communication and advertising costs;

- Office supplies and printing costs (including costs for printing forms, records, and books used in the Center's operations);

- Costs for securities storage and preservation: counting, transportation, storage, listing, settlement, depositary services...;

- Maintenance and repair costs for equipment ensuring the operation of the trading system;

- Costs for establishing communication networks directly serving the Center's operations;

- Purchase and provision of working materials and equipment;

- Repair and maintenance costs for assets;

- Training and professional development costs;

- Uniforms and personal protective equipment costs;

- Costs for hiring domestic and foreign experts (if any);

- Rent for office space and other fixed assets (if any);

- Other necessary and reasonable costs such as electricity, water, sanitation, hospitality, conferences, transactions...;

- 其他费用。

3. Revenue and Expenditure Management:

a) General principles in managing revenue and expenditure of the Center:

- All income and expenditures arising during the Center's operations must be fully, accurately, and promptly recorded in the accounting books in accordance with the state accounting regulations for the Securities Trading Center. The Center may not have off-the-books income or fail to record income sources.

- Designated or undesignated grants from domestic and foreign organizations and individuals to the Center must be recorded as state budget funding.

- Other expenditures: Sanitation, administrative fees, electricity, water, reception, hospitality, conference... expenses are carried out in accordance with state regulations within approved plan limits.

- Funds established in the year that are not used up can be transferred to the next year for use. Specifically, unused state budget funding in the year must be returned to the funding unit (except in cases specified separately).

b) Annual state budget funding and received grants and aid are considered state budget funding:

The preparation, implementation, and settlement of the annual operating budget plan of the Securities Trading Center shall be carried out in accordance with the current state budget management regulations.

c) For fees and other income:

All fees and other income as stipulated in points b and c of item 1, collectively referred to as income from the Center's operations, shall be used as follows:

1. Fulfilling obligations to the state budget: The Center registers and pays 10% of the total fees and charges collected in the year to the tax authority and proceeds with the procedures for fulfilling obligations to the state budget according to the tax authority's guidance.

2. Deduct amounts for disciplinary fines for violations in the submission of state budget revenues, administrative violation fines, and contract breach penalties with customers.

3. The remainder shall be allocated to the following funds by the Center:

- Welfare and incentive fund: the maximum amount to be allocated to each fund according to the regulations applicable to officers and civil servants under the State Securities Commission (SSC).SEC.

- The remaining portion after allocating the two aforementioned funds shall be used to establish a business development incentive fund.

d) Management and utilization of the business development incentive fund:

- The business development incentive fund of the Center shall be established as a source of support from the State Budget to be used for the following purposes:

* Expenditure on purchasing equipment for operations.

* Upgrading equipment, technical means, information technology, and working conditions of the Center.

* Reimbursement of maintenance and repair costs for machinery and equipment to maintain the Center's transaction activities.

* Expenditure on supporting research and training to enhance the professional skills of Center staff.

* Expenses to ensure the safety of securities storage facilities.

* Other expenses to support special business activities of the Center.

- The use of the business development incentive fund must comply with the approved plan by the competent authority. Strictly prohibit using this fund for purposes contrary to the prescribed content.

e) Management and utilization of the assets of the Securities Trading Center:

- Asset purchases must have a plan and be reviewed by the superior management agency. The capital used for asset purchases is formed from:

+ State Budget funds allocated according to the plan.

+ Additional funding from the business development incentive fund.

- Construction expenditure must be carried out in accordance with relevant State regulations on basic construction investment (with plans, approved budgets, disbursements according to progress, acceptance and settlement when work is completed).

- The Center's assets must be recorded and monitored in ledgers, subject to periodic inventory checks and depreciation calculations in accordance with regulations applicable to administrative and service units.

g) The Securities Trading Center shall not include the following items in its expenses:

- Travel expenses abroad exceeding the limits set by the State.

- Expenses from established funds such as: Incentive and welfare fund (awards, hardship allowances, contributions to social organizations, other agencies, localities); Business development incentive fund (support for purchasing operational equipment, training for Center staff, other expenses).

- Basic construction investment and fixed asset purchases for the Center from investment funds.

- Other expenses that do not conform to the provisions stated in Section 2 above.

h) The payment support fund managed by the Securities Trading Center:

The Securities Trading Center is authorized to establish and manage a payment support fund from contributions by member securities companies to ensure the payment cycle when member securities companies temporarily lack payment capacity. The management and operation of the payment support fund shall be conducted separately from the Center's internal financial system and not consolidated with the Center's assets.

4. Accounting, settlement, and auditing work of the Securities Trading Center:

1. The Securities Trading Center must carry out accounting and statistics in accordance with the Accounting and Statistics Ordinance and accounting regulations issued by the Ministry of Finance.

2. The Securities Trading Center is responsible for implementing the quarterly and annual financial reporting and settlement system as currently prescribed.

3. The Securities Trading Center's annual financial report must be audited by the National Audit Office.

4. The Securities Trading Center's financial reports and audit reports must be submitted to the Prime Minister, the State Securities Commission, and the Ministry of Finance.

5. Financial planning:

- At the time of annual budget planning, the Securities Trading Center must prepare and report to the State Securities Commission, concurrently sending to the Ministry of Finance, the Ministry of Planning and Investment, the operating budget plan and the Center's income and expenditure financial plan, including:

+ Operating budget plan funded by the State Budget.

+ The Center's income and expenditure plan.

+ Plan for utilizing the business development incentive fund.

- The Center's annual budget estimate, after being reviewed by the Ministry of Finance, will serve as the basis for implementation during the year. The State Securities Commission is responsible for reviewing and monitoring the quarterly income and expenditure estimates for the Center within the scope of the approved annual budget estimate. The quarterly estimates reviewed by the State Securities Commission will serve as the basis for the Center's implementation.

III. IMPLEMENTATION

1. The Center is legally responsible for the use of State Budget funds to ensure compliance with current State regulations on financial management applicable to administrative and service units and the provisions of this Circular.

2. This Circular takes effect fifteen days from the date of signature; during implementation, if there are any difficulties, please reflect them to the Ministry of Finance for timely supplementation and amendment./.