Decision No. 1062-TC/QĐ/CSTC promulgates the regime for managing, using, and depreciating fixed assets

Pursuant to …;

Regarding the issuance of regulations on the management, use, and depreciation of fixed assets

THE MINISTER OF FINANCE

Entrust the Accounting and Finance Department:

- 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;

- Based on Decree No. 59/CP dated October 3, 1996 of the Government promulgating financial management rules and business accounting for state-owned enterprises;

- To strengthen the work of managing, using, and depreciating fixed assets in enterprises; to create conditions for enterprises to accurately calculate and fully deduct the depreciation of fixed assets from business costs; to replace and modernize machinery and equipment in line with advanced technology and modern techniques suitable for the business requirements of enterprises and the economy;

- Considering the proposals of the Heads of the Department of Financial Policy, the General Director of the State Capital and Asset Management General Department at Enterprises:

DECISION:

Article 1: Issued together with this Decision is the "Regulations on Management, Use, and Depreciation of Fixed Assets".

This regulation applies to all state-owned enterprises. Enterprises belonging to other economic sectors shall only be required to apply the provisions related to determining costs for tax purposes; other provisions are encouraged to be applied.

Article 2: This Decision takes effect from January 1, 1997.

All previous documents such as Decision No. 507 TC/ĐTXD dated July 22, 1986 of the Minister of Finance, Circulars No. 33 TC/CN and No. 34 TC/CN dated July 31, 1990, Circular No. 31 TC-TCĐN dated July 18, 1992, Circular No. 36 TC/TCDN dated April 27, 1995 of the Ministry of Finance and other Decisions regarding the management, use, and depreciation of fixed assets that conflict with this Decision are hereby abolished.

Article 3: The Heads of the Department of Financial Policy, the General Directors of the State Capital and Asset Management General Department at Enterprises, the General Director of the Tax General Department, and the Heads of units under the Ministry of Finance within their respective functions and authorities are responsible for organizing the implementation, guiding the application, and supervising the enforcement of this Decision.

The Board of Directors, General Managers, and Directors of enterprises are responsible for implementing this Decision.

the Ministry of Finance

Vice Minister

Phan Van Trong

(Signed)

REGULATIONS

MANAGEMENT, USE, AND DEPRECIATION OF FIXED ASSETS

(Issued together with Decision No. 1062 TC/QĐ/CSTC dated November 14, 1996 of the Minister of Finance)

PART I: GENERAL PROVISIONS

Article 1: Objectives and Scope of Application:

These regulations apply to state-owned enterprises, including: Holding companies, member enterprises of holding companies, and independent enterprises;

For enterprises belonging to other economic sectors such as joint-stock companies, limited liability companies, private enterprises, foreign-invested enterprises..., this regulation is only mandatory for determining costs for tax purposes; other provisions in this regulation are encouraged to be applied.

Enterprises shall manage, use, and depreciate each individual fixed asset under their management and use.

Article 2: The terms used in this regulation are understood as follows:

1. Tangible Fixed Assets: These are major means of production having material form (each unit of asset with independent structure or a system consisting of multiple parts of assets interconnected to perform one or several specific functions) with high value and long-term usage, participating in many business cycles while maintaining their original physical form such as buildings, structures, machines, equipment...

2. Intangible Fixed Assets: These are fixed assets without material form, representing a quantity of value already invested directly related to many business cycles of the enterprise such as: costs for establishing the enterprise; costs for land use; costs for patents, inventions, copyrights...

3. Leased Fixed Assets:

Leased fixed assets are those fixed assets leased by enterprises from leasing companies if the lease contract satisfies at least one of the following four conditions (as stipulated in Decree No. 64/CP dated October 9, 1995 of the Government):

a. At the end of the lease period according to the contract, the lessee has the right to transfer ownership of the leased asset or continue leasing it upon mutual agreement of both parties;

b. The content of the lease contract specifies: At the end of the lease period, the lessee has the right to choose to purchase the leased asset at a nominal price lower than its actual value at the time of repurchase;

c. The lease term for a type of asset must be at least 60% of the time required to depreciate the leased asset;

d. The total lease payments for a type of asset specified in the lease contract must be at least equivalent to the market price of the asset at the time of signing the contract.

Any lease contract for fixed assets that does not satisfy any of the above four conditions is considered operational lease fixed assets.

4. Original Cost of Fixed Assets: This is the total actual cost incurred to acquire fixed assets until they are put into normal operation, including the actual purchase price of the fixed assets; transportation, handling, installation, and test run costs; interest on loans for fixed assets before delivery and use; taxes and stamp duties (if applicable)...

5. Useful Life of Fixed Assets: This is the period during which the enterprise plans to use the fixed assets in business operations under normal conditions, consistent with the economic and technical parameters of the fixed assets and other factors related to the operation of the fixed assets.

6. Depreciation of Fixed Assets: This is the gradual reduction in the value of fixed assets due to participation in business operations, natural wear and tear, technological progress... during the operation of the fixed assets.

7. Depreciation of Fixed Assets: This is the systematic calculation and allocation of the original cost of fixed assets into business expenses over the useful life of the fixed assets.

8. Accumulated Depreciation of Fixed Assets: This is the total amount of depreciation allocated into business expenses through various business periods of the fixed assets up to the date of determination.

9. Remaining Value on Accounting Books of Fixed Assets: This is the remaining value of fixed assets reflected on accounting books, determined by the difference between the original cost of fixed assets and the accumulated depreciation of fixed assets up to the date of determination.

10. Repair of fixed assets: refers to maintenance, upkeep, and repair activities aimed at restoring the normal operational capacity of fixed assets that have been damaged during their operation.

11. Upgrade of fixed assets: refers to activities aimed at extending the useful life, increasing productivity, and enhancing the functionality of fixed assets through renovation, construction, installation, and supplementary equipment.

Article 3: State-owned enterprises must register with the capital and asset management agency directly managing them according to the provisions of Clause 3 and Clause 4, Article 15 of this Regulation, and simultaneously notify the directly managing tax authority after receiving confirmation from the capital and asset management agency.

Enterprises belonging to other economic sectors must register with the directly managing tax authority according to the provisions of Clause 3 and Clause 4, Article 15 of this Regulation.

PART II: PROVISIONS ON MANAGEMENT AND USE OF FIXED ASSETS
FIXED ASSETS

Article 4: Standards and identification of fixed assets:

1. Standards and Identification of Fixed Assets:

Any means of production that is a tangible asset with an independent structure, or a system consisting of multiple individual parts interconnected to perform one or several specific functions, such that if any part is missing, the entire system cannot operate, and which simultaneously meets both of the following criteria:

1. Has a usage period of one year or more;

2. Has a value of five million dong or more; shall be considered fixed assets.

In cases where a system consists of multiple individual parts interconnected, each component having different usage periods, and even if one part is missing, the system can still perform its main operational function, but due to management and usage requirements for fixed assets, it is necessary to manage each part separately, then each part shall be considered an independent tangible fixed asset (for example, seats, frames, and engines in an airplane).

For perennial orchards, each plot of land shall be considered a tangible fixed asset.

2. Standards and identification of intangible fixed assets:

All actual expenses incurred by enterprises related to all business activities, if they simultaneously meet both conditions stipulated in Clause 1 of this Article and do not form tangible fixed assets, shall be considered intangible fixed assets. If these expenses do not simultaneously meet both aforementioned standards, they shall be directly recorded or gradually allocated to the enterprise's business costs.

Article 5: Determination of the original cost of fixed assets: 1. Determination of the original cost of tangible fixed assets:

a. Purchased fixed assets:

The original cost of purchased fixed assets (including new and used purchases) includes: the actual purchase price (as recorded on the invoice) minus any discounts or rebates; interest on borrowed funds invested in fixed assets before their use; transportation, handling, installation, trial run, tax, and initial registration fee (if applicable)...

b. Constructed fixed assets:

The original cost of constructed fixed assets (both self-built and outsourced) is the actual construction cost according to the current regulations on investment and construction management, other related costs, and initial registration fee (if applicable).

For working animals and/or long-term perennial crop plots, the original cost is the total actual, reasonable, and legitimate expenses incurred from the formation until the commencement of operation and use, as stipulated in the current regulations on investment and construction management, other related costs, and initial registration fee (if applicable).

c. Fixed assets received or transferred...

The original cost of fixed assets transferred or received includes: the remaining book value of the fixed assets at the transferring units or the actual valuation by the handover committee; refurbishment costs; repair costs; transportation, handling, installation, trial run, and initial registration fee (if applicable) that the receiving party must incur before putting the fixed assets into use.

Specifically, the original cost of fixed assets transferred between affiliated units within an enterprise reflects the cost recorded at the transferring unit consistent with the asset's file. The receiving unit bases the original cost, accumulated depreciation, remaining book value, and records them in the accounting books. Costs associated with the transfer of fixed assets between affiliated units are not added to the original cost of fixed assets but are recorded as business expenses for the period.

d. Fixed assets received as gifts, donations, joint venture contributions, returned contributions, or discovered surplus...

The original cost of fixed assets received as gifts, donations, joint venture contributions, returned contributions, or discovered surplus includes: the actual valuation by the handover committee; refurbishment and repair costs; transportation, handling, installation, trial run, and initial registration fee (if applicable) that the receiving party must incur before putting the assets into use.

2. Determination of the original cost of intangible fixed assets:

a. Land use costs: include all actual expenses directly related to land use, including: payment for land use rights (including annual or periodic land lease payments, if applicable); compensation for land clearance, leveling, and initial registration fee (if applicable)... (excluding costs for constructing buildings on the land).

In cases where an enterprise pays for land use rights annually or periodically, these costs shall be gradually allocated to business expenses over the periods, and not recorded in the original cost of fixed assets.

b. Business establishment costs: include all actual, reasonable, and necessary expenses incurred by those involved in establishing the enterprise directly related to preparing for the establishment of the enterprise, including research, exploration, project investment establishment costs; project evaluation costs; meeting costs for establishment... if these costs are recognized by the participants as part of their capital contribution and recorded in the registered capital of the enterprise.

c. Research and development costs: include all actual expenses incurred by the enterprise for conducting research, exploration, and developing long-term investment plans aimed at providing long-term benefits to the enterprise.

d. Costs for patents, copyrights, purchasing copyrights, technology transfers...: include all actual expenses incurred by the enterprise for research projects (including testing production costs, state inspection and acceptance costs) resulting in patents, copyrights granted by the state, or costs for purchasing copyrights, trademarks, and technology transfers from organizations and individuals, which serve the direct business operations of the enterprise.

e. Business advantage costs: are expenses for the difference that the enterprise must pay additionally (additional payment difference = purchase price - actual value of assets assessed) beyond the actual value of assets assessed (fixed assets, current assets...) when the enterprise purchases, merges with, or consolidates another enterprise. This advantage is formed by business location advantages, reputation and credibility with customers, skill level of the workforce, management and organizational capabilities of that enterprise's management board...

3. Determining the original cost of financial lease fixed assets:

The original cost of financial lease fixed assets reflected at the lessee unit is the difference between the total long-term debt minus (-) the total interest expense the lessee must pay (for the lease period) recorded in the asset lease contract.

The determination of the original cost of financial lease fixed assets shall be carried out in accordance with the provisions set forth in Appendix 3 attached to this regime.

Article 6: Expenses incurred by the enterprise to upgrade fixed assets are reflected as an increase in the original cost of those fixed assets and cannot be recorded as operating expenses for the period.

Fixed asset repair costs are considered as expenses and are directly recorded or gradually allocated to operating expenses for the period.

For certain special industries where repair costs for fixed assets occur unevenly between periods and years, if the enterprise wants to pre-charge repair costs for fixed assets into operating expenses, it must develop a plan to pre-charge repair costs for fixed assets and submit it to the Ministry of Finance for review and decision; the enterprise must notify the directly managing finance authority after receiving written approval from the Ministry of Finance.

The enterprise must settle the actual repair costs incurred with the pre-charged repair costs; if the actual repair costs exceed the pre-charged amount, the difference will be directly accounted for or gradually allocated to operating expenses in the period; if the actual repair costs are less than the pre-charged amount, the difference will be accounted for as a reduction in operating expenses in the period.

Enterprises in special industries applying the method of allocating repair costs for fixed assets over subsequent operating periods must also develop a plan to allocate repair costs for fixed assets and notify the directly managing finance authority.

Article 7: All fixed assets in the enterprise must have separate files (the file includes the handover record of fixed assets, contracts, invoices for purchasing fixed assets, and other related documents), must be monitored, managed, used, and depreciated in accordance with the provisions of this Regime. Fixed assets must be classified, statistically recorded, numbered, and have individual cards, detailed tracked according to each object recording fixed assets, and reflected in the fixed asset tracking ledger.

The enterprise must manage and use fixed assets that have been fully depreciated but still participate in business activities as regular fixed assets.

Periodically at the end of each fiscal year, the enterprise must conduct an inventory of fixed assets; all cases of excess or shortage of fixed assets must be documented, the causes identified, and appropriate measures taken.

Article 8: Classification of fixed assets in the enterprise:

Based on the nature of fixed assets in the enterprise, the enterprise classifies fixed assets according to the following criteria:

1. Fixed assets for business purposes: are those fixed assets used by the enterprise for its business purposes.

a. Intangible fixed assets: enterprises classify them in detail according to each type of intangible fixed asset.

b. Tangible fixed assets: the enterprise classifies them as follows:

Type 1: Buildings, structures: are fixed assets of the enterprise formed through construction activities such as office buildings, warehouses, fences, water towers, parking lots, decorative works for buildings, roads, bridges, railways, ferry crossings, ports...

Type 2: Machinery and equipment: include all types of machinery and equipment used in business operations such as specialized machinery, work equipment, production lines, single machines...

Type 3: Transportation equipment and transmission devices: include various transportation means such as railway, waterway, road, air, pipeline transport, and transmission devices like communication systems, electrical systems, water pipelines, conveyor belts...

Type 4: Management equipment and tools: include equipment and tools used in business management activities such as computers for management purposes; electronic devices; measuring, quality inspection equipment, dehumidifiers, dust extractors, pest control equipment...

Type 6: Other fixed assets: includes all other fixed assets not listed in the above five types such as paintings, artworks...

2. Fixed assets for welfare, public services, national defense: are fixed assets managed and used by the enterprise for welfare, public services, national defense purposes within the enterprise. These fixed assets are also classified according to the provisions of Clause 1 of this Article.

3. Fixed assets kept on behalf of the State: are fixed assets kept on behalf of other units or the State according to the regulations of authorized state agencies.

Depending on the management requirements of each enterprise, enterprises may classify their fixed assets in more detail within each group as appropriate.

Article 9: The monitoring, management, utilization, and depreciation of fixed assets must comply with the principle of valuation based on original cost, accumulated depreciation, and remaining value on accounting records of fixed assets:

Remaining value on accounting records = Original cost of fixed assets - Accumulated depreciation of fixed assets

in the fixed asset accounting book = fixed asset - acquisition cost of the asset

of fixed fixed assets

The original cost of fixed assets in enterprises can only be changed in the following cases:

1. Revaluation of the value of fixed assets;

2. Upgrading of fixed assets;

3. Dismantling one or more parts of fixed assets;

When changing the original cost of fixed assets, the enterprise must prepare a record detailing the grounds for the change and re-determine the original cost indicators, remaining value on accounting books, accumulated depreciation of fixed assets, and proceed with accounting according to current regulations.

Article 10: According to financial regulations, enterprises have the right to:

- Transfer fixed assets between subsidiaries to serve business purposes more effectively;

- Proactively sell fixed assets to recover capital for more effective business purposes;

- Proactively dispose of obsolete fixed assets that cannot be sold or are damaged beyond repair;

- Lease out idle fixed assets temporarily not in use but ensure they can be tracked and managed. The enterprise and the lessee must enter into a lease agreement specifying the type of fixed asset, lease term, rental payments, and responsibilities of the parties involved...

- Use fixed assets as collateral or mortgage... but still must ensure monitoring and management of these fixed assets.

When transferring fixed assets, both parties must prepare a record regarding the condition of the fixed assets, responsibilities of the parties, and measures to handle any damage or loss of fixed assets.

During the period of pledging, mortgaging, leasing (operational leasing)... fixed assets, the enterprise still must calculate and allocate depreciation of these fixed assets into operating expenses for the period.

When liquidating or selling fixed assets, the enterprise must establish a Committee to determine the recovery value upon liquidation, the sale price of fixed assets, organize the liquidation and sale of fixed assets in accordance with current regulations.

All activities related to leasing, pledging, mortgaging, transferring... of fixed assets must comply strictly with the provisions of the Civil Code and current financial management regulations for enterprises.

Article 11: For fixed assets used under operating leases, the enterprise is responsible for managing and using them in accordance with the provisions of the lease contract. The enterprise shall not depreciate these fixed assets; lease costs for fixed assets are recorded as business expenses for the period.

Article 12: For fixed assets used under financial leases, the enterprise must monitor, manage, and use them as if they were fixed assets owned by the enterprise and must fulfill all obligations committed to in the lease contract for fixed assets.

The lessor, as the investor, must monitor, manage, and comply with the provisions of the lease contract.

Article 13: For labor materials that are not fixed assets (labor materials that do not meet the value criteria but have a usage period of one year or more - referred to as small labor tools), the enterprise must monitor, manage, and use these assets as if they were fixed assets and must calculate and gradually allocate their value into business expenses over time according to their usage period appropriately.

For small labor tools whose values have been fully allocated but are still usable, the enterprise must monitor, manage, and use these small labor tools as normal small labor tools but shall not allocate their value into business expenses.

Article 14: For state-owned enterprises engaged in public services, all leasing, pledging, mortgaging, selling, liquidating... of fixed assets must comply strictly with the financial management regulations for state-owned enterprises engaged in public services.

PART III: PROVISIONS ON DEPRECIATION
FIXED ASSETS

Article 15: Determining the useful life of fixed assets:

1. Based on the following criteria, the enterprise determines the useful life of fixed assets appropriately:

- Technical lifespan of fixed assets according to design;

- The condition of fixed assets (how long the fixed assets have been in use, the generation of fixed assets, the actual condition of the fixed assets...);

- The purpose and estimated efficiency of the fixed asset.

2. Specifically, for new fixed assets (unused) and used fixed assets with an actual value of 90% or more (compared to the sale price of new fixed assets of the same type or equivalent fixed assets on the market), the enterprise must also base on the useful life framework of fixed assets stipulated in Appendix 1 attached to this Regulation to determine the useful life of fixed assets appropriately.

In cases where the enterprise wishes to determine the useful life of fixed assets differently from the useful life specified in Appendix 1 issued together with this Regulation (longer or shorter than the prescribed framework), or for fixed assets not specified in Appendix 1, the enterprise must prepare a record clearly stating the bases for determining the useful life of such fixed assets and submit it to the Ministry of Finance for review and decision.

After receiving the decision of the Ministry of Finance, the enterprise must notify the directly managing financial authority.

3. Enterprises are not allowed to change the useful life of fixed assets already determined and registered with the directly managing financial authority as stipulated above for at least three years (3 years) from the date when the financial authority confirms the useful life of the fixed assets.

In cases where factors affecting (such as upgrading or dismantling one or several parts of fixed assets...) extend or shorten the previously determined useful life of fixed assets, the enterprise must re-determine the useful life of fixed assets according to the above provisions at the completion of the transaction.

The enterprise must prepare a record clearly stating the bases for changing the useful life and the new useful life of fixed assets and re-register with the directly managing financial authority.

4. When registering the useful life of fixed assets (determined according to the above provisions) with the directly managing financial authority, enterprises must clearly state the name, type of fixed assets, bases for determining the useful life, useful life of similar fixed assets registered previously...

5. For fixed assets under financial leases, the useful life of fixed assets is determined as the lease term stated in the contract.

Article 16: For intangible fixed assets, the useful life is determined by the enterprise itself appropriately but shall not exceed 40 years and shall not be less than 5 years.

Article 17: Method of depreciation of fixed assets.

1. Fixed assets in enterprises are depreciated using the straight-line method, as follows:

- Based on the provisions of this Regulation, the enterprise determines the useful life of fixed assets and registers it with the directly managing financial authority;

- Determine the average annual depreciation rate for fixed assets according to the formula below:

Depreciation rate Original cost of fixed assets

average annually =

of fixed assets Usage time

The enterprise is permitted to round off the annual average depreciation rate just determined according to the following provisions to the nearest whole number:

- The first decimal place having a value of 5 or higher is rounded up to one unit value for the whole number (for example: 950,713.5 VND is rounded to 950,714 VND).

- The first decimal place having a value of 4 or lower retains the whole number (for example: 950,713.4 VND is rounded to 950,713 VND).

If the enterprise depreciates monthly, the annual depreciation amount is divided by 12 months.

2. In cases where the useful life or original cost of fixed assets changes, the enterprise must re-determine the average annual depreciation rate of fixed assets by dividing the remaining book value by the newly determined useful life or remaining useful life (calculated as the difference between the registered useful life minus the time already used) of the fixed assets.

3. The depreciation rate for the last year of the useful life of fixed assets is determined as the difference between the original cost of fixed assets and the accumulated depreciation already performed on such fixed assets.

Article 18: Increases or decreases in the original cost of fixed assets are reflected at the time of increasing or decreasing fixed assets in the month.

Depreciation or cessation of depreciation of fixed assets is carried out on a full-month basis. Fixed assets added, reduced, or withdrawn from business operations (stored according to state regulations, awaiting liquidation, etc.) in a month will be subject to depreciation or cessation of depreciation from the first day of the following month.

Article 19: All fixed assets of enterprises related to business activities must be depreciated; the depreciation rate of fixed assets is recorded as business expenses for the period.

1. Fixed assets not participating in business operations do not need to be depreciated. This includes:

Fixed assets that are not in use or have been decided by the competent authority to be placed in storage, preservation, and mobilization for other enterprises shall be kept according to such decisions.

- Fixed assets under state reserves entrusted to enterprises for management and custody...

- Fixed assets serving welfare activities within the enterprise such as kindergartens, clubs, traditional houses, dining halls, etc.; fixed assets of public institutions, defense, and security units (excluding those units implementing economic accounting) within the enterprise; fixed assets serving common societal needs, not for the enterprise's own business operations, such as dikes, bridges, roads, ports, etc., which the State entrusts to the enterprise for management.

- Other fixed assets not participating in business operations.

2. Enterprises shall manage and monitor fixed assets serving welfare purposes; fixed assets of public institutions, defense, and security units (excluding those units implementing economic accounting) within the enterprise; fixed assets serving common societal needs, not for the enterprise's own business operations, which the State entrusts to the enterprise for management, in the same manner as fixed assets used in business operations. The enterprise shall determine and monitor the depreciation rate of these fixed assets (if applicable), with the annual depreciation rate determined by dividing the original cost by the determined useful life of the fixed asset as stipulated in Clause 1, Article 15 of this Regulation.

If these fixed assets participate in business operations, during the period they are involved in business operations, the enterprise shall calculate and allocate depreciation to the business expenses of the enterprise.

Article 20: Enterprises are not allowed to calculate and record depreciation for fixed assets that have been fully depreciated but are still used in business operations.

For fixed assets that have not been fully depreciated but are damaged, enterprises must identify the cause, assign responsibility for compensation, seek damages, and handle losses according to current regulations.

For fixed assets awaiting liquidation decisions, from the time the fixed assets cease to participate in business operations, the enterprise shall cease allocating depreciation according to the provisions of this regulation.

Article 21: The Acceptance Council, Liquidation Council, Sale Council... of fixed assets in the enterprise shall be established by the enterprise and include mandatory members such as the General Director of the enterprise, the Chief Accountant or Head of the Finance and Accounting Department of the enterprise, a technical expert knowledgeable about the type of fixed asset (inside or outside the enterprise), a representative of the party transferring the asset (if any), and other members designated by the enterprise. In special cases or as provided by the current financial management regulations, the enterprise may invite representatives of the directly managing financial authorities and the economic-technical management authorities (if any) to participate in these Councils.

SECTION IV: PROVISIONS ON THE MANAGEMENT OF THE ACCUMULATED DEPRECIATION OF FIXED ASSETS

Article 22. Enterprises are permitted to use the entire accumulated depreciation of fixed assets for reinvestment, replacement, and modernization of fixed assets; all investment construction activities must comply with the current regulations on investment and construction management stipulated in the Articles of Association.

When there is no immediate need for reinvestment in fixed assets, enterprises may flexibly utilize the accumulated depreciation to meet their business requirements.

Article 23: In state-owned conglomerates, the mobilization of the accumulated depreciation of fixed assets of member units must comply strictly with the current state financial management regulations and the financial rules of the Conglomerate approved by the Minister of Finance.

PART V. IMPLEMENTATION ORGANIZATION

Article 24: This regime shall take effect from January 1, 1997.

Article 25: For fixed assets put into use before January 1, 1997, when applying this regime, enterprises must carry out the following:

- Base on accounting records and asset files to determine the remaining value index on the accounting books of fixed assets;

- Evaluate the remaining useful life of fixed assets;

- Determine the average annual depreciation rate of fixed assets in accordance with Article 17 of this regime.

Enterprises continue to monitor, manage, and utilize these fixed assets according to the original cost indicators, remaining values on accounting books, and accumulated depreciation in strict compliance with the provisions of this regime.

Fixed assets with an original cost under five million dong that do not meet the criteria for being classified as fixed assets according to the regulations shall be transferred to monitoring, management, utilization, and gradual allocation of remaining values on accounting books as small tools in accordance with the provisions of this regime.

Article 26: Units under the Ministry of Finance, within their respective functions and tasks, are responsible for organizing and guiding enterprises to implement this regime correctly.

Article 27: During implementation, if there are any difficulties, please report them to the Ministry of Finance for study and resolution.