Circular No. 10/2004/TT-BTC guides the examination, verification, and notification of annual settlement for administrative agencies, public service units, and budgets at all levels.

CIRCULAR

Guidelines for reviewing, auditing, and announcing annual settlement

for administrative agencies, public service units

and budgets at all levels

Pursuant to Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government detailing and guiding the implementation of the State Budget Law;

Pursuant to Circular No.  Circular No. 59/2003/TT-BTC dated June 23, 2003 of the Ministry of Finance guiding the implementation of Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government detailing and guiding the implementation of the State Budget Law;

To ensure uniformity in the preparation of annual settlement reports, review, audit, and announcement of annual settlements for administrative agencies, public service units, and budgets at all levels, the Ministry of Finance guides the work of annual settlement, review, audit, and announcement  of annual settlements for administrative agencies, public service units, and budgets at all levels as follows:  as follows:

I. GENERAL PROVISIONS  GENERAL PROVISIONS

1- Objectives:

This Circular applies to the following subjects:

1.1 Administrative state agencies; public service units; political-social organizations, political-social-professional organizations, social organizations, social-professional organizations using state budget funds (hereinafter referred to collectively as budgetary units);

Budgets at various levels of local government;

1.3 Financial authorities at various levels.

2. The entities specified in Point 1 above, within their respective duties and powers, shall be responsible for preparing, submitting, reviewing, auditing, and announcing annual settlements in accordance with this Circular and related regulations.

II. SPECIFIC PROVISIONS  SPECIFIC PROVISIONS

1- Regarding the preparation and submission of annual settlement reports:

1.1 For budgetary units at all levels:

- When preparing annual settlement reports on the budget, budgetary units at all levels must ensure accurate, truthful, and complete data. The content of the annual settlement report on the budget must comply with the contents recorded in the assigned budget (or approved by competent authorities) and detailed according to the state budget classification. The head of the unit using the budget shall be legally responsible for the accuracy, truthfulness, and completeness; shall be responsible for any incorrect accounting, settlement, and violation of regulations. Annual settlement reports  of budget-using units must have confirmation from the Treasury at the same level regarding the total amount and details. In addition to the annual settlement report, the unit must also submit:

A balance sheet up to December 31 and a balance sheet after the completion of the adjustment period for settlement;

An explanatory report on the annual settlement explaining clearly the reasons for achieving, not achieving, or exceeding the assigned budget targets by each indicator and any recommendations (if any).

An explanatory report on the remaining funds not settled and carried over to the next year.

An explanatory report on the implementation of key tasks during the year.

Budgetary units at all levels prepare and submit annual settlement reports on the budget in the following sequence:

Level III budgetary units organize and implement accounting work and prepare annual settlement reports for their own units and subordinate budget-using units (if any) according to the administrative and public service accounting system and send them to Level II or Level I budgetary units (in cases directly under Level I budgetary units).

Level II budgetary units consolidate and prepare annual settlement reports including their own annual settlement report and the annual settlement reports of subordinate budgetary units that have been reviewed (according to Form Nos. 1, 2, 3, and 4 attached) and send them to Level I budgetary units.

 The deadline for submitting annual settlement reports by Level II and Level III budgetary units shall be determined by Level I budgetary units but must ensure the time limit for Level I budgetary units to submit annual settlement reports to financial authorities as prescribed.

Central-level Level I budgetary units consolidate and prepare annual settlement reports including their own annual settlement report and the annual settlement reports of subordinate units that have been reviewed (according to Form Nos. 1, 2, 3, and 4 attached) and send them to the Ministry of Finance  no later than October 1 of the following year, accompanied by notifications of approval of annual settlements for subordinate units. The annual settlement report of central-level Level I budgetary units sent to the Ministry of Finance shall include two copies and a floppy disk.

For budgetary units at the local level, the People's Committee of provinces shall specify in detail to ensure the deadline for submitting annual settlement reports for local budgets as stipulated in Article 67 of the State Budget Law.

1.2 For authorized funds:

Directly using units of authorized funds from higher-level budgets must prepare annual settlement reports in accordance with regulations and submit them to the financial authority granting authorization and the relevant specialized management agency at the same level.

The financial authority receiving authorized funds shall be responsible for consolidating the annual settlements of units using authorized funds that have been reviewed and submit them to the authorizing financial authority and related agencies as prescribed in Circular No. 59/2003/TT-BTC dated June 23, 2003 of the Ministry of Finance guiding the implementation of Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government detailing and guiding the implementation of the State Budget Law.

1.3 For budgets at various levels of local government:

The preparation and submission of annual settlement reports shall be carried out in accordance with Circular No. 59/2003/TT-BTC dated June 23, 2003 of the Ministry of Finance guiding the implementation of Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government detailing and guiding the implementation of the State Budget Law.

Annual settlement reports on local budget revenues and expenditures of provincial finance departments shall be submitted to the Ministry of Finance simultaneously with floppy disks.

1.4 For the National Treasury:

Annual settlement reports of units, of budgets at various levels of local government, sent to competent authorities for review and approval must have confirmation from the National Treasury (where the unit has an account) regarding the total amount of funds actually withdrawn (including both advance withdrawals and amounts already paid by the National Treasury) matching the total amount and details by chapter, type, item, and sub-item according to the current state budget classification.

2 - Content of annual settlement review:

2.1 Content of annual settlement review:

a/ For administrative agencies (including administrative state agencies implementing quota of staff and administrative management expenses according to Decision No. 192/2001/QĐ-TTg dated December 17, 2001 of the Prime Minister); political-social organizations, political-social-professional organizations, social organizations, social-professional organizations using state budget funds; local government budgets at various levels, the content for reviewing final accounts shall be as follows:

Review each item of revenue from fees and charges as prescribed in Laws, Ordinances on fees and charges, and other revenues (if any) as prescribed.

Review each item of expenditure, including expenditures on fees and charges; expenditures from the state budget; expenditures from savings; and expenditures from other sources. Each item of expenditure must satisfy the following conditions:  as follows:

Being included in the state budget estimate assigned by the competent authority (including additional amounts and reduced amounts during the year).

Complying with the regulations, standards, and norms stipulated by the competent state authority.

Being decided by the head of the budget-using unit or the person authorized to decide on expenditure.

Inspect the procurement, management, and use of assets of the unit to ensure compliance with relevant regulations.

Inspect the accounting entries of revenues and expenditures to ensure compliance with the accounting system, budget sub-accounts, and fiscal year.

Inspect the legality and validity of revenue and expenditure vouchers. The figures in the accounting books and final account reports must match the vouchers and figures of the State Treasury.

In cases where expenditures violate regulations, exceed standards, or norms, they must be adjusted and recovered and submitted to the state budget.

b/ For public service units (including those that have been granted financial autonomy), the content for reviewing final accounts shall be as follows:

Review each item of revenue from tuition fees, medical fees, fees and charges, income from production and service provision activities, and other revenues (if any) generated by the unit; ensuring that revenues comply with the provisions of Laws, Ordinances on taxes, fees and charges, and regulations of the competent authority.

Review each item of expenditure, including expenditures on tuition fees, medical fees,  fees and charges; expenditures from the state budget; expenditures from regular savings; production and service provision activities, and expenditures from other sources. Each item of expenditure must satisfy the following conditions:  as follows:

Being included in the state budget estimate assigned by the competent authority (including additional amounts and reduced amounts during the year).

Ensuring expenditures comply with the regulations, standards, and norms stipulated by the competent authority.

Being decided by the head of the budget-using unit or the person authorized to decide on expenditure.

For public service units with income implementing financial autonomy according to Decree No. 10/2002/NĐ-CP dated January 16, 2002 of the Government on financial systems applicable to public service units with income, based on internal expenditure regulations of the unit and regulations of the Ministry of Finance to inspect and review. If the unit has not yet established internal expenditure regulations, it shall follow current regulations.

Inspect the procurement, management, and use of assets of the unit to ensure compliance with relevant regulations.

Inspect the accounting entries of revenues and expenditures to ensure compliance with the accounting system, budget sub-accounts, and fiscal year.

Inspect the legality and validity of revenue and expenditure vouchers. The figures in the accounting books and final account reports must match the vouchers and figures of the State Treasury.

In cases where expenditures violate regulations, exceed standards, or norms, they must be adjusted and recovered and submitted to the state budget.

3. Content for auditing final accounts:

Check the completeness and accuracy of final account figures as prescribed, ensuring consistency between final account figures  of primary budget units with the approval of final accounts of subordinate units and confirmation of figures by the State Treasury.

4. Authority to review, audit, and notify the results of review and audit of final accounts:

4.1. For budgetary units:

Higher-level budgetary units are responsible for reviewing final accounts and notifying the results of the review of lower-level budgetary units under their jurisdiction according to Tables 5 and 6 attached.

Before inspecting and reviewing the final account report of lower-level budgetary units, the head of the higher-level budgetary unit is responsible for informing the inspection plan to lower-level units, while reporting to the finance department at the same level for coordination.

After inspecting and reviewing the final account report of  lower-level budgetary units, the head of the higher-level budgetary unit is responsible for notifying the results of the final account review to lower-level budgetary units. Within ten days from receiving the notification of the final account review, lower-level budgetary units must complete all requirements in the notification of the final account review. If the lower-level budgetary unit disagrees with the notification of the final account review of the higher-level budgetary unit, it must submit a written document to the higher-level budgetary unit for reconsideration and decision. If the second-level budgetary unit disagrees with the notification of the final account review of the head of the first-level budgetary unit, it must submit a written document to the finance department (at the same level as the first-level budgetary unit) for reconsideration and decision. While awaiting decisions from competent authorities, lower-level budgetary units must comply with the notification of the final account review of the higher-level budgetary unit.

4.2. For finance departments at various levels:

The finance department is responsible for auditing and notifying the audit results of annual final accounts for first-level budgetary units or reviewing and notifying the review results of annual final accounts for first-level budgetary units when the first-level budgetary unit is also a budget beneficiary (third-level budgetary unit) within its budget according to Tables 5, 6, and 7 attached.

The Ministry of Finance is responsible for auditing and notifying the audit results of annual final accounts within a maximum period of thirty days from the date of receipt of the final account report.

Financial agencies at all levels of local government authorities are responsible for reviewing and announcing the annual settlement review within the time frame specified by the People's Committee of the province, but must ensure that the time for settling accounts allows the Provincial People's Council to approve the local budget settlement not later than 12 months after the end of the fiscal year; the Provincial People's Council shall specify the approval period for the budget settlement of lower-level People's Councils, but not later than six months after the end of the fiscal year.

Within ten working days from the date the first-level budget unit receives the annual settlement review notification from the financial agency, the first-level budget unit must complete all requirements stated in the financial agency's annual settlement review notification.

In cases where the first-level budget unit disagrees with the financial agency's annual settlement review notification, it must submit the matter to the same-level People's Committee (if it is a budget unit under local government) or submit to the Prime Minister (if it is a budget unit under central authority) for consideration and decision. While awaiting the decision of the same-level People's Committee or the Prime Minister, all decisions of the financial agency must be implemented.

If the figures in the financial agency's annual settlement review notification differ from those in the first-level budget unit's annual settlement, the first-level budget unit must adjust its annual settlement to align with the figures in the financial agency's annual settlement review notification and notify the second-level units accordingly within ten working days. Upon receiving the first-level budget unit's annual settlement adjustment notification, the second-level budget units must adjust their own annual settlements and notify the third-level budget units within ten working days. Upon receiving the higher-level budget unit's annual settlement adjustment notification within ten working days, the third-level budget units must adjust their own annual settlements accordingly.

4.3 Regarding the review of entrusted expense settlement:

The financial agency receiving entrusted funds shall take the lead in coordinating with the relevant management agency at the same level to examine and approve the entrusted expense settlement report of the direct user of the entrusted funds, and compile and submit the entrusted expense settlement report to the entrusting financial agency and the higher-level specialized management agency.

The entrusting financial agency shall take the lead in coordinating with the relevant management agency at the same level to audit, examine, and announce the results of the entrusted expense settlement audit conducted by the receiving financial agency, and incorporate the results into the budget expenditure settlement of the entrusting level.

4.4 For budgets of all levels of local government:

Financial agencies at all levels shall review and announce the annual settlement review of revenue and expenditure of lower-level budgets according to Form No. 8 attached to this Circular.

III - IMPLEMENTATION

Joint Resolutions, Circulars  This takes effect fifteen days after publication in the Official Gazette and applies to the examination, review, and announcement of the 2004 annual settlement and onwards, replacing Circular No. 21/2000/TT-BTC dated March 16, 2000, issued by the Ministry of Finance on guiding the examination and announcement of annual settlements for administrative and public service units.

As for the examination and announcement of the 2003 annual settlement for administrative agencies and public service units, they shall follow the provisions of Circular No.  21/2000/TT-BTC dated March 16, 2000, issued by the Ministry of Finance./.