CIRCULAR

Guidelines for Implementing the Financial Management Regulation for the Vietnam Development Bank

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Pursuant to Decision No. 44/2007/QĐ-TTg dated March 30, 2007 of the Prime Minister on the issuance of the Financial Management Regulation for the Vietnam Development Bank (hereinafter referred to as the Vietnam Development Bank), the Ministry of Finance provides specific guidelines as follows:

This technical regulation sets out technical requirements, testing methods, sampling procedures; management requirements; responsibilities of organizations and individuals producing, trading, and importing cigarettes.

1. These Circular applies to the financial management activities of the Vietnam Development Bank system.

2. The Vietnam Development Bank is provided with charter capital and working capital by the State to fulfill credit investment and export credit tasks and government programs and objectives. It is also allowed to mobilize medium and long-term funds, receive and manage State funds to implement State credit investment and export credit policies.

3. When performing State credit investment and export credit tasks, the Vietnam Development Bank is compensated for interest rate differences and management fees by the State.

4. The Government guarantees the payment capacity of the Vietnam Development Bank; it is responsible for ensuring repayment and covering costs; it is exempt from paying taxes and other State budget contributions for its State credit investment and export credit activities, while other activities must comply with tax regulations., other activities shall be subject to taxation in accordance with the provisions of the law.

5. The Vietnam Development Bank operates without profit-making objectives, with a zero percent (0%) mandatory reserve ratio, and is not required to participate in deposit insurance.

6. The Vietnam Development Bank is a centralized accounting unit within the entire system; it may use income to cover operating expenses; surplus or deficit financial revenues and expenditures shall be distributed in accordance with these Circular guidelines.

7. The General Director of the Vietnam Development Bank is responsible under the Law and State management agencies for managing safely, using properly and efficiently all sources of funds and assets, complying with financial, accounting, and auditing systems. manage safety, use funds and assets for their intended purposes effectively, comply with financial, accounting, and auditing systems.

8. The Ministry of Finance performs State management functions over finance, guides, inspects, and audits the implementation of financial systems by the Vietnam Development Bank.

II.  PROVISIONS ON CAPITAL, FUNDS, AND ASSETS

1. The operational capital of the Vietnam Development Bank includes:

1.1. Shareholders' equity:

a) Charter capital of the Vietnam Development Bank;

b) Differences arising from asset revaluation and exchange rate fluctuations;

c) Supplementary reserve funds and development investment funds.

1.2. Mobilized capital:

a) Issuance of government bonds, government-guaranteed bonds, Vietnam Development Bank bonds, and promissory notes and deposit certificates in accordance with the law;

b) Loans from Postal Savings Service Company, Vietnam Social Security, and domestic financial institutions, and credit organizations;

c) Loans from foreign financial institutions and credit organizations.

1.3. Other capital includes:

a) Post-investment support capital from the State budget;

b) Directly borrowed Official Development Assistance (ODA) capital and ODA capital authorized by the Ministry of Finance to lend again;

c) Entrusted deposits from domestic and foreign organizations;

d) Entrusted capital, loan disbursements for investment, and debt recovery from domestic and foreign organizations through entrusted contracts between the Vietnam Development Bank and entrusting organizations;

đ) Voluntary non-refundable contributions from individuals, economic organizations, financial and credit organizations, political-social organizations, associations, and non-governmental organizations both domestically and internationally;

e) Capital from the State budget allocated to perform credit investment and export credit tasks and government programs and objectives.

f) Other sources of capital as prescribed by law.

2. Use of capital and assets:

2.1. The Vietnam Development Bank may use operational capital for:

a) Implementing State credit investment and export credit policies as stipulated by the Government;

b) Basic construction investment and procurement of fixed assets of the Vietnam Development Bank, up to a maximum of 15% of actual charter capital;

c) Entrusted disbursement and entrusted loans at the request of the entrusting party.

2.2. The Vietnam Development Bank has the right to adjust the capital and asset structure within the system to serve its operations.

2.3. The transfer of capital and assets among units under and directly under the Vietnam Development Bank is decided by the General Director of the Vietnam Development Bank.

3. Annually, the Vietnam Development Bank must balance the State credit investment and export credit plan with available capital to implement it. Plan the mobilization of various sources of capital; when mobilizing capital at market interest rates for lending, it must ensure the principle of only mobilizing after fully utilizing interest-free or low-interest capital and balancing with capital usage needs, avoiding idle capital.

4. The Vietnam Development Bank is responsible for implementing regulations to ensure capital safety, including:

4.1. Managing and using capital according to purpose, target, effectively, ensuring repayment and covering costs;

4.2. Purchasing property insurance and other related insurance systems in accordance with regulations;

4.3. Idle temporary capital can be deposited at domestic banks or the State Treasury;

4.4. In necessary cases, the Vietnam Development Bank is permitted to repurchase securities issued by the Vietnam Development Bank in accordance with the Ministry of Finance's regulations;

4.5. Establishing a risk reserve fund in accordance with Part III of this Circular.

5. Capital for basic construction investment and fixed asset procurement

5.1. Capital for basic construction investment and fixed asset procurement of the Vietnam Development Bank is formed from the following sources:

a) Depreciation of fixed assets;

b) Development Investment Fund;

c) Other lawful sources as prescribed by the State.

5.2. All basic construction and fixed asset procurement activities of the Vietnam Development Bank must be carried out strictly in accordance with State regulations on basic construction investment, must be economical, effective, and ensure:

a) Within the approved financial plan budget by the Management Board.

b) The residual value of fixed assets does not exceed 15% of actual charter capital.

5.3. The depreciation rate of fixed assets is implemented in accordance with regulations applicable to state-owned enterprises.

6. Asset inventory

6.1. The Development Bank shall conduct an asset inventory when closing the accounting books to prepare the annual financial report; when implementing decisions on division, separation, merger, or consolidation; after natural disasters, enemy attacks, or other reasons causing changes in the Development Bank's assets; or as prescribed by competent state agencies.

6.2. For excess or missing assets, the cause must be clearly identified, the responsibility of those involved determined, and material compensation levels established according to regulations.

7. Revaluation of Assets

7.1. The Development Bank must revalue its assets in the following cases: pursuant to the decision of the Ministry of Finance; liquidation, sale of assets.

7.2. Asset inventories and revaluations must comply with current regulations applicable to state-owned enterprises. Any increases or decreases in asset values due to revaluation shall adjust the sources of capital of the Development Bank according to the regulations of the Ministry of Finance.

8. The Development Bank must organize reconciliation of receivables and payables when closing the accounting books to prepare the annual financial report.

9. In cases of asset losses, the Development Bank must identify the causes and handle them accordingly:

9.1. If the loss of assets is due to the fault of a collective or individual, the collective or individual responsible must compensate according to the law.

9.2. If the assets have been insured, they shall be handled according to the insurance contract.

9.3. The value of the loss, after being offset by compensation from individuals, collectives, or insurance organizations, if insufficient, shall be recorded as expenses for the Development Bank in the relevant period.

10. Leasing, Pledging, or Hypothecating Assets

10.1. The Development Bank has the right to lease, pledge, or hypothecate assets under its ownership according to the principle of efficiency, preservation, and development of capital as stipulated by law.

10.2. The General Director of the Development Bank decides and is responsible for leasing, pledging, and hypothecating assets.

11. Liquidation, Sale of Assets

11.1. The Development Bank may liquidate or sell assets that are obsolete, deteriorated, irreparable, technologically outdated, or not in demand or not effectively utilized. The Management Council of the Development Bank decides on the liquidation or sale of office premises and reports to the Ministry of Finance.

11.2. When liquidating or selling assets, the Development Bank must appraise the assets and organize auctions according to the law.

11.3. Revenue or expenses from the liquidation or sale of assets shall be recorded as income or expenses of the Development Bank. Proceeds from the sale of assets, residual values of sold assets, and costs of selling assets shall be recorded as income or expenses of the Development Bank.

III. CLASSIFICATION OF DEBTS, PROVISIONS FOR BAD DEBT RESERVES

1. The Development Bank shall classify debts according to the regulations of the State Bank of Vietnam.

2. The Development Bank may establish bad debt reserves from operating costs to cover losses and damages caused by objective factors during the lending process for investment credit projects and export credit projects of the State, investment credit guarantee projects, export credit guarantee projects, and bid guarantee and contract performance guarantee projects. Banks.

3. The Development Bank temporarily establishes bad debt reserves at a maximum rate of 0.5% of the average outstanding loan balance for investment loans, export credit loans, and obligations for investment credit guarantees, export credit guarantees, and bid guarantee and contract performance guarantee obligations of the Development Bank. Annually, after receiving the Financial Settlement Notification from the Ministry of Finance, the Development Bank reviews and adjusts entries if there are discrepancies.

4. The balance of the bad debt reserve fund at the time Decision No. 44/2007/QĐ-TTg dated March 30, 2007, of the Prime Minister on the management of financial affairs for the Development Bank took effect shall be transferred to the bad debt reserve fund.

5. The bad debt reserve fund may be used to write off principal debts for projects (including cases where the sale price of the debt is lower than the principal amount) according to the decision of the Prime Minister. Based on the Prime Minister's decision on writing off principal debts, the Development Bank uses the bad debt reserve fund to offset the corresponding principal amount written off.

6. At the end of the year, if the bad debt reserve fund is not fully utilized, the remaining balance shall be carried forward to the next year's bad debt reserve fund. If the balance of the bad debt reserve fund is insufficient to cover losses incurred in the year, General Director the Development Bank shall report to the Ministry of Finance to submit to the Prime Minister for consideration and decision on measures to address the situation.

IV. POST-INVESTMENT SUPPORT CAPITAL CONTRIBUTIONS

1. Before July 20 each year, the Development Bank prepares the budget estimate for post-investment support capital contributions for the planning year and sends it to the Ministry of Finance and the Ministry of Planning and Investment for inclusion in the state budget expenditure plan submitted to competent authorities for approval.

2. Based on the approved state budget expenditure plan, quarterly, based on the implementation progress of the Development Bank, the Ministry of Finance provides post-investment support capital contributions upon the Development Bank's request.

3. The Development Bank manages and uses post-investment support capital contributions according to Decree No. 151/2006/NĐ-CP dated December 20, 2006, of the Government on state investment credit and export credit, and Circular guiding Decree No. 69/2007/TT-BTC dated June 25, 2007, of the Ministry of Finance; and does not use post-investment support capital contributions for other purposes.

4. At the end of the year, the Development Bank is responsible for settling accounts with the Ministry of Finance regarding the post-investment support capital contributions received and actually provided to project sponsors and making adjustments:

4.1. If the actual amount provided to project sponsors exceeds the amount provided by the Ministry of Finance during the year, the Ministry of Finance will provide the additional amount within the approved budget estimate. Any excess over the officially provided amount and the approved budget estimate (if any) will be allocated in the next year's budget for post-investment support capital contributions.

4.2. In cases where the actual amount settled for investors is lower than the amount allocated by the Ministry of Finance in the year, the difference shall be considered as the provisional allocation for the following year (in case the support continues to occur in the following year); or must be returned to the State Budget (in case there is no support in the following year).

5. The budget for post-investment support allocated to the Development Bank in a year that is not fully utilized may be transferred to the next year for continued use.

V. INTEREST RATE DIFFERENCE SUBSIDY ALLOCATION

1. Establishing the budget for interest rate difference subsidy allocation.

1.1. Before July 20th each year, based on the forecast of mobilizing various sources of capital and the State's policy on investment credit development, the Development Bank shall prepare the budget for interest rate difference subsidy expenditure for the planning year and submit it to the Ministry of Finance and the Ministry of Planning and Investment for consolidation in the State Budget expenditure plan to be submitted to competent authorities for decision.

1.2. Based on the State Budget expenditure plan assigned by the competent authority, quarterly, based on the implementation progress of the Development Bank, the Ministry of Finance shall allocate the interest rate difference subsidy and management fee according to the Development Bank's proposal.

2. Principles for implementing interest rate difference subsidy allocation.

2.1. The allocation to the Development Bank shall be implemented on a provisional quarterly basis based on the situation regarding capital mobilization and balance, and the loan disbursement progress of each project in the quarter. At the end of the fiscal year, based on the final settlement approved by the Management Board of the Development Bank, the Ministry of Finance shall determine the official amount of subsidy required for the entire year and make adjustments accordingly.

2.2. The provisional quarterly allocation shall be carried out according to the following principles:

a) First Quarter: Allocate 75% of the first quarter budget estimate.

b) Second Quarter: Allocate 75% of the second quarter budget estimate ± adjustment for the first three months.

c) Third Quarter: Allocate 75% of the third quarter budget estimate ± adjustment for the first six months.

d) Fourth Quarter: Allocate 75% of the fourth quarter budget estimate ± adjustment for the first nine months.

3. Amount of interest rate difference subsidy allocation.

3.1. Formula for determining the amount of interest rate difference subsidy allocation

 

3.2. Method for determining factors to calculate the interest rate difference subsidy allocation

a) Average loan balance of all projects: is the total loan balance of investment credit and export credit from the State calculated using the average monthly method. Excluded from this calculation are:

- Projects entrusted to the Development Bank by organizations and individuals.

- Projects exempted from debt repayment by the Government.

b) Average interest rate of all sources of capital: is the weighted average interest rate between the interest rate of each source of capital and the balance of each source of capital, including non-interest-bearing capital (excluding ODA funds, entrusted funds from localities, organizations, and individuals both domestically and internationally), calculated as follows:

Where:

- Total actual interest paid for mobilizing all sources of capital: is the total actual interest paid for mobilizing all sources of capital excluding ODA funds, entrusted funds from localities, organizations, and individuals both domestically and internationally.

- Total actual capital is the total balance of all sources of capital, including non-interest-bearing capital; excluding ODA funds, entrusted funds from localities, organizations, and individuals both domestically and internationally.

c) Average loan interest rate of all projects: is the weighted average interest rate between the actual loan balance calculated using the average monthly method and the loan interest rate set for each project, calculated as follows:

Total interest revenue from loan collections is the actual interest collected (including both on-time and overdue interest) from the State's investment credit and export credit activities; penalty interest on projects guaranteed but not repaid on time, forcing the Development Bank to repay on behalf.

4. Procedure for interest rate difference subsidy allocation

4.1. Provisional quarterly allocation

a) On the 15th day of the first month of each quarter, based on the consolidated data from branches, the Development Bank prepares the quarterly subsidy allocation budget with explanations and submits it to the Ministry of Finance.

b) Based on the subsidy allocation budget arranged in the State Budget expenditure plan; based on the quarterly subsidy allocation budget of the Development Bank, on the 25th day of the first month of each quarter, the Ministry of Finance provisionally allocates the subsidy to the Development Bank in accordance with Clause 2 - Section V of this Circular.

c) Adjusting the quarterly subsidy allocation

- On the 15th day of the first month of the subsequent quarter, based on the consolidated data from branches, the Development Bank calculates the actual subsidy allocation for the previous quarter, the difference with the previously provisionally allocated subsidy, and submits it along with explanations to the Ministry of Finance.

- Based on the budget allocated in the State Budget expenditure plan, based on the Development Bank's request for subsidy allocation, the Ministry of Finance determines the actual subsidy allocation for the previous quarter:

+ If the actual subsidy allocation for the previous quarter is higher than the previously provisionally allocated amount, the Ministry of Finance will supplement the shortfall together with the provisional allocation for the next quarter.

+ If the actual subsidy allocation for the previous quarter is lower than the previously provisionally allocated amount, the Ministry of Finance will deduct the excess amount from the provisional allocation for the next quarter.

4.2. Annual adjustment of subsidy allocation based on the final settlement

a) At the end of the fiscal year, based on the officially approved final settlement data, the Development Bank determines the annual subsidy allocation required, along with explanations, and submits it to the Ministry of Finance.

b) Based on the subsidy allocation budget arranged in the State Budget; based on the final settlement data, the Ministry of Finance determines the annual subsidy allocation for the Development Bank and implements adjustments.

c) The adjustment of the annual subsidy allocation based on the final settlement is carried out as follows:

- If the annual subsidy allocation determined by the final settlement is higher than the provisional allocation made during the year (quarterly), the Ministry of Finance will supplement the shortfall within the scope of the notified budget. Any excess difference between the officially determined annual subsidy allocation and the notified budget (if any) will be allocated in the next year's subsidy allocation budget.

Supplementary allocations during the final settlement period are included in the final settlement of the budget expenditure year, supplementary allocations after the final settlement period are included in the final settlement of the next year's budget expenditure.

If the annual settlement amount for interest rate subsidy compensation is lower than the provisional compensation granted during the year (quarterly), the excess will be deducted from the provisional compensation for the first quarter of the following year (if the following year still involves compensation); or must be returned to the State Budget (if the following year does not involve compensation).

4.3. In the case where the budgeted interest rate subsidy for the year by the Development Bank is not fully utilized, it shall be carried over to the next year for continued use.

VI – MANAGEMENT FEES

1. Establishing the management fee budget

1.1. Before July 20 each year, the Development Bank shall establish and submit the management fee budget to the Ministry of Finance and the Ministry of Planning and Investment for inclusion in the annual State Budget proposal to be decided by the Prime Minister.

1.2. Based on the annual management fee budget allocated in the State Budget expenditure plan, the Development Bank shall prepare the quarterly management fee budget together with the interest rate subsidy budget and send it to the Ministry of Finance.

2. Method of calculating management fees

Total interest revenue from loan collections is the actual interest collected (including both on-time and overdue interest) from the State's investment credit and export credit activities; penalty interest on projects guaranteed but not repaid on time, forcing the Development Bank to repay on behalf.

3. Principles and procedures for granting management fees

3.1. Principles for granting management fees: The granting of management fees to the Development Bank shall be implemented on a provisional quarterly basis along with interest rate subsidy compensation based on actual loan interest income in the quarter.

3.2. Procedures for granting management fees

a) On the 15th day of the first month of each quarter, based on the consolidated actual interest income data from Development Bank branches up to the end of the previous quarter, the Development Bank shall issue a request for management fees accompanied by an explanation and send it to the Ministry of Finance.

Based on the budget allocation in the State Budget expenditure plan, and upon the Development Bank's request, the Ministry of Finance shall grant management fees to the Development Bank according to regulations.

b) At the end of the fiscal year, based on the approved final settlement figures by the Management Board, the Development Bank shall re-determine the total management fees received for the year, accompanied by an explanation and send it to the Ministry of Finance.

- Based on the management fee budget allocated in the State Budget for the year and the actual interest income settlement figures for the year provided by the Development Bank, the Ministry of Finance shall determine the management fees that the Development Bank is entitled to receive for the year, make adjustments, and grant them accordingly.

- In the case where the annual management fee settlement amount exceeds the provisional amount granted during the year, the Ministry of Finance shall supplement the shortfall within the scope of the announced budget. Any excess between the settlement amount and the announced budget (if any) shall be allocated in the next year's interest rate subsidy budget.

- In the case where the annual management fee settlement amount is less than the provisional amount granted during the year, the difference shall be considered as the provisional amount for the next year (if the next year still involves management fee grants) or must be returned to the State Budget (if the next year does not involve management fee grants).

- Supplementary amounts during the final settlement period shall be included in the current year's budget expenditure settlement, while supplementary amounts after the final settlement period shall be included in the next year's budget expenditure settlement.

3.3. In the case where the management fee budget for the year by the Development Bank is not fully utilized, it shall be carried over to the next year for continued use.

VII. FINANCIAL INCOME AND EXPENSES

1. The income of the Development Bank includes all revenues generated from its business operations and other services, including:

1.1. Income from business operations:

a) Interest receivable (on time and overdue penalties) from investment projects financed by the Development Bank (excluding interest from ODA lending activities, entrusted funds from localities, and domestic and foreign organizations); penalties for overdue projects guaranteed but not repaid on time, forcing the Development Bank to repay instead;

b) Interest income from export credit lending;

c) Interest income from deposits made by the Development Bank at the National Treasury and domestic banks; d) Fees for entrusted capital disbursement and lending;;

đ) Interest rate differential compensation;

e) Management fees for lending projects using domestic funds;

f) Management fees for lending projects using ODA funds according to the Rescheduling Loan Regulations issued by the Prime Minister;

g) Management fees for other activities;

h) Exchange rate differential income;

i) Income from payment services, information, and treasury;

k) Other business operation and service income.

1.2. Income from service activities, rental income from assets;

1.3. Other income:

a) Penalties;

b) Proceeds from asset liquidation and sale;

c) Income from funds previously treated through risk provisions;

d) Other lawful income.

Expenses of the Development Bank include reasonable costs incurred during the period, including:

2. 2.1. Business operation expenses:

a) Interest expense on borrowed funds (excluding interest on ODA lending projects rescheduled) including bond interest, interest on borrowing from domestic and foreign organizations;

b) Interest expense on customer deposits at the Development Bank;

c) Fund-raising expenses, including bond issuance, promissory note issuance, and certificate of deposit issuance expenses;

d) Printing costs for banknotes and securities of the Development Bank;

đ) Payment service costs;

e) Entrusted agency costs, including debt collection agency costs;

f) Risk provision costs;

g) Exchange rate differential costs;

h) Treasury operation costs, including transportation, loading and unloading, counting, sorting, and packaging costs, security costs, and other treasury operation costs;

i) Environmental protection costs;

k) Association and industry costs that the Development Bank participates in;

l) Litigation costs, costs related to the resolution of collateral for loans, and costs related to loan recovery;

m) Other business operation costs.

2.2. Management costs:

a) Costs for Development Bank staff:

- Salaries and allowances as prescribed (including those for contractual workers); The salary system is implemented according to Article 24 of Chapter III of Decision No. 44/2007/QĐ-TTg dated March 30, 2007 of the Prime Minister on the issuance of Financial Management Regulations for the Development Bank.

- Paying salaries and allowances as prescribed (including payments for contractual labor); The wage system shall be implemented in accordance with Article 24 of Chapter III of Decision No. 44/2007/QĐ-TTg dated March 30, 2007 of the Government Chairman on the issuance of Financial Management Regulations for the Development Bank.

- Expenses for social insurance, health insurance, and contributions to trade union funds in accordance with state regulations;

- Paying midday meal expenses: the amount paid per person shall not exceed the national minimum wage for workers and civil servants;

- Expenses for transaction uniforms, the amount of which is decided by the General Director, not exceeding 1,000,000 VND per person per year;

- Allowance expenses for part-time members of the Management Board and the Supporting Team in accordance with legal provisions;

- Expenses for female employees in accordance with regulations;

- Expenses for labor protective equipment in accordance with regulations;

- Expenses for setting up a reserve fund for termination benefits. The annual contribution rate ranges from 1 to 3% of the actual salary fund of the Development Bank;

b) Depreciation expenses for fixed assets. The contribution rate is as prescribed for state-owned enterprises;

c) Expenses for management and public service activities:

- Expenses for purchasing labor tools and office supplies;

- Expenses for fire prevention and firefighting activities;

- Expenses for postal and telecommunication fees: expenses for postage, telecommunications, telephone, telegraph, leased communication channels, telex, fax, etc., paid according to invoices from postal agencies. The provision of official telephones at home and mobile phones for Development Bank leaders shall be implemented in accordance with the Ministry of Finance's regulations on the use of telephones for leaders in administrative agencies, public institutions, political organizations, and state-owned enterprises;

- Expenses for electricity, water, healthcare, and sanitation for the agency;

- Expenses for fuel and oil for transportation services for staff on business trips and bank leaders on work assignments, implemented in accordance with the Ministry of Finance's regulations on the use of vehicles in administrative agencies, public institutions, and state-owned enterprises;

- Travel expenses for staff on domestic and international business trips, settled in accordance with current regulations of the Ministry of Finance;

- Expenses for publicity, press conferences, transaction costs, foreign affairs, and conference fees. These expenses shall not exceed 5% of total expenses;

- Expenses for inspection, audit, and supervision of units under and directly affiliated with the Development Bank, in accordance with prescribed regulations;

- Maintenance and repair expenses for assets;

- Training, professional training, scientific research, technological innovation expenses: organizing short-term training, professional development, and vocational training classes for Development Bank staff; purchasing materials, printing, and translating documents to support training, development, and vocational training, research, etc.;

d) Other management expenses;

2.3. Rental asset expenses;

2.4. Other expenses:

a) Expenses for recovering debts that have been waived, ensuring that the expenses incurred are lower than the amount of debt recovered;

b) Expenses for compensating asset losses in accordance with regulations;

c) Expenses for collecting penalties as prescribed;

d) Expenses for paying taxes as prescribed;

đ) Expenses for asset insurance and other types of insurance as prescribed;

e) Expenses for liquidation, sale, and residual value of liquidated or sold assets;

f) Expenses supporting the activities of the Party and mass organizations of the Development Bank in accordance with state regulations;

g) Other reasonable and legitimate expenses;

3. The Development Bank shall not account for the following expenses:

3.1. Losses that have been supported by the Government or compensated by insurance companies or the party responsible for the loss;

3.2. Penalties for administrative violations and financial system violations;

3.3. Construction investment expenses for basic construction projects, purchases, upgrades, and renovations of fixed assets funded by basic construction capital;

3.4. Expenses for welfare facilities;

3.5. Expenses for supporting localities, social organizations, and other agencies;

3.6. Domestic and international travel expenses exceeding the limits set by the state;

3.7. Expenses covered by other funding sources;

VIII. DISTRIBUTION OF INCOME AND USE OF FUNDS

1. Distribution of income

After deducting financial penalties for violating laws and regulations and compensating previous deficits, the annual revenue surplus shall be distributed as follows:

a) Allocate 50% to the development investment fund;

b) Allocate to the award and welfare funds. The maximum allocation for each fund is three months' actual salary. The annual allocation ratio for each fund is determined by the General Director after consulting the Development Bank Trade Union in writing;

c) Allocate to the supplementary capital reserve fund, the amount being the remainder after allocating to the above funds;

2. Purpose of using allocated funds

2.1. The development investment fund is used for expanding the scale of operations, modernizing technology and equipment, and improving working conditions for the Development Bank in accordance with the State's Investment Management Regulations;

2.2. The award fund is used for:

a) Year-end or regular bonuses based on productivity and performance of Development Bank staff. The bonus amount is determined by the General Director after consulting the Development Bank Trade Union in writing;

b) Special bonuses for individuals or groups within the Development Bank who have innovative ideas or process improvements that increase efficiency. The bonus amount is determined by the General Director;

c) Bonuses for individuals or entities outside the Development Bank that meet contractual conditions and contribute effectively to the bank's operations. The bonus amount is determined by the General Director;

2.3. The welfare fund is used for:

a) Building, repairing, or supplementing capital for welfare facilities of the Development Bank, contributing capital to joint welfare construction projects within the industry or with other units through agreements;

b) Expenses for sports, cultural, and public welfare activities for Development Bank staff;

c) Contributions to social welfare funds and support for mass organizations;

d) Regular and emergency hardship assistance for Development Bank staff; Development Bank staff;

đ) Other welfare activities;

The General Director determines the expense levels after consulting the Development Bank Trade Union in writing.

2.4. The supplementary capital reserve fund is used to supplement the registered capital. At the end of the fiscal year, the balance of the supplementary capital reserve fund shall be used to supplement the registered capital within the limits prescribed in Article 2 of the Financial Management Regulation for the Vietnam Development Bank issued together with Decision No. 44/2007/QĐ-TTg dated March 30, 2007 of the Prime Minister.

The balance of the supplementary capital reserve fund at the time Decision No. 44/2007/QĐ-TTg dated March 30, 2007 of the Prime Minister on the issuance of the Financial Management Regulation for the Vietnam Development Bank took effect and was carried forward into registered capital. 

IX. ACCOUNTING AND FINANCIAL PLANNING REGIME

1. Before July 20 each year, the Vietnam Development Bank is responsible for preparing and reporting to the Ministry of Finance and the Ministry of Planning and Investment the following plans:

1.1. Capital source and utilization plan:

a) Annual capital source plan includes:

- Additional registered capital from the State budget;

- Post-investment support capital from the State budget; capital for implementing national goals and programs;

- Implementation of guarantee obligations;

- Loan repayment capital;

- Capital raised from various sources;

- Other capital

b) Capital utilization plan:

- Total credit investment and export credit capital of the State under various forms of support: investment loans, post-investment support, investment credit guarantees, and sectoral, regional structures; repayment plan for raised capital sources;

- Export credit loan plan, export credit guarantee plan, tender guarantee plan, and contract implementation plan.

1.2. Interest rate differential subsidy and management fee plan.

1.3. Basic construction investment plan: accompanied by detailed explanations about planned basic construction, fixed asset purchases, and capital balancing.

1.4. Post-investment support plan;

1.5. Revenue and expenditure financial plan: accompanied by detailed explanations about revenue and expenditure items.

1.6. Labor and salary plan.

These plans serve as the basis for the Vietnam Development Bank to implement and settle financial accounts with the finance authority.

2. Periodic Reports

2.1. Periodically, monthly, quarterly, and annually, in addition to reports according to the Accounting System and Circular No. 69/2007/TT-BTC dated June 25, 2007 of the Ministry of Finance (from Form 01/BC-VDB to Form 09/BC-VDB), the Vietnam Development Bank is responsible for preparing and submitting to the Ministry of Finance the following financial reports:

a) Interest rate differential subsidy report (from Form 10/BC-VDB to Form 12/BC-VDB);

b) Management fee subsidy report (Form 13/BC-VDB).

2.2. The submission deadlines for the reports are as follows:

a) Quarterly report: no later than the 15th day of the first month of the next quarter;

b) Annual report: no later than January 30 of the following year;

c) Settlement report: no later than June 30 of the following year.

3. The Vietnam Development Bank implements internal audit procedures, publicly announces annual financial operation results, and is responsible for the published data.

The annual financial report of the Vietnam Development Bank must be compulsorily audited in accordance with the law and approved by the Board of Management before being reported to the Ministry of Finance (report to the Ministry of Finance no later than June 30 of the following year).

4. The Vietnam Development Bank is subject to financial inspection by the Ministry of Finance, including:

4.1. Regular or spot checks on accounting reports and settlement reports.

4.2. Special topic inspections based on financial management requirements.

4.3. Financial oversight and approval of annual financial settlements. 

X. IMPLEMENTATION

1. This Circular takes effect fifteen days after its publication in the Official Gazette.

2. The Vietnam Development Bank is responsible for guiding subordinate units to implement the financial regime in accordance with the Financial Management Regulation for the Vietnam Development Bank issued by the Prime Minister and the guidance provided in this Circular.

In the course of implementation, if there are any difficulties, the Vietnam Development Bank is requested to report to the Ministry of Finance for study and resolution./.