Joint Circular No. 13/2005/TTLT-BTC-BLDTBXH guiding standards, conditions, procedures for appointing, dismissing, and determining salary levels for chief accountants and accounting supervisors in business organizations.

 JOINT CIRCULAR

Guidelines for standards, conditions, and procedures for appointing, dismissing, and setting salaries for chief accountants and accounting supervisors in business organizations and determining the salary grade for the Chief Accountant, in charge of accounting in business operating organizations

 

Implementing Article 37 and Article 38 of Decree No. 129/2004/NĐ-CP dated May 31, 2004 of the Government detailing and guiding the implementation of certain provisions of the Accounting Law applicable to business activities, after exchanging opinions with relevant Ministries and agencies, the Joint Ministry of Finance and Ministry of Labour, Invalids and Social Affairs hereby provide guidelines for standards, conditions, and procedures for appointing, dismissing, and setting salaries for chief accountants and accounting supervisors in business organizations as follows:

I. APPLICABLE OBJECTS

The subjects to which this Circular applies include business organizations conducting accounting work in accordance with Article 2 of Decree No. 129/2004/NĐ-CP dated May 31, 2004 of the Government (referred to as accounting units), specifically as follows:

1. State-owned companies operating under the Law on State-Owned Enterprises, including:

a) State-owned corporations (State-owned corporations established according to the Law on State-Owned Enterprises in 1995 and State-owned corporations decided to be invested in and established according to the Law on State-Owned Enterprises in 2003; State-owned corporations established by companies investing and establishing themselves; State-owned investment and business corporations);

b) Independent state-owned companies;

c) Independent accounting subsidiary companies of State-owned corporations decided to be invested in and established by the State.

2. State-owned companies operating under the Enterprise Law, including:

a) State-owned joint-stock companies;

b) State-owned limited liability companies with one member;

c) State-owned limited liability companies with two members or more;

d) Enterprises with controlling shares or capital contributions from the State;

đ) Enterprises with a portion of capital from the State;

e) State-owned companies holding controlling rights over other enterprises;

3. Business organizations operating under the Enterprise Law, including:

a) Limited liability companies;

b) Joint-stock companies;

c) Partnership companies;

d) Private enterprises.

4. Foreign-invested enterprises operating under the Law on Investment by Foreign Investors in Vietnam.

5. Branches of foreign enterprises operating in Vietnam.

6. Representative offices of foreign enterprises operating in Vietnam.

7. Cooperatives operating under the Law on Cooperatives.

8. Individual households and cooperative groups.

II. ASSIGNING PERSONNEL AS CHIEF ACCOUNTANTS, ACCOUNTING SUPERVISORS, AND ENGAGING CHIEF ACCOUNTANTS

1. Accounting Units

Accounting units are entities specified in Part I of this Circular that conduct accounting work and prepare financial reports in accordance with the Accounting Law.

2. Assigning persons to be chief accountants

Accounting units must assign persons to be chief accountants, including:

a) Accounting units specified in Points 1, 2, 3, 4, 5, and Point 7 of Part I of this Circular;

b) Subsidiary companies of State-owned corporations determined as accounting units;

c) Parent and subsidiary companies of State-owned corporations established by companies investing and establishing themselves, converted to a parent-subsidiary company model;

d) Business organizations with multi-level accounting structures, if the basic level is an accounting unit with significant accounting workload must have at least two accountants.

For special State-owned companies directly serving national defense and security, the assignment of personnel as chief accountants shall be regulated by the Ministry of National Defense, Ministry of Public Security, and the Government Office of Official Communications after consultation with the Ministry of Finance.

3. Assigning persons to be responsible for accounting

Entities and organizations that can assign personnel as accounting supervisors include:

a) Accounting units specified in Point 2 above, if lacking a chief accountant, the head of the accounting unit must immediately assign a chief accountant. If there is no person meeting the criteria and conditions for appointment as a chief accountant, an accounting supervisor may be assigned for a maximum period of one fiscal year, after which a chief accountant must be appointed immediately.

b) Business organizations specified in Points 6 and 8 of Part I of this Circular are not required to assign a chief accountant but must designate an accounting supervisor. There is no time limit for the person designated as an accounting supervisor in this case.

4. Engaging chief accountants

Accounting units that must assign a chief accountant as specified in Point 2 above but cannot appoint a chief accountant or an accounting supervisor must engage a chief accountant in accordance with Clause 2, Article 37, Decree No. 129/2004/NĐ-CP.

5. Relationship between chief accountant and deputy chief accountant with head of accounting department and deputy head of accounting department

a) Accounting units that have already appointed a chief accountant or designated an accounting supervisor shall not appoint a head of the accounting department. The chief accountant or accounting supervisor will concurrently perform the tasks assigned to the head of the accounting department.

b) In accounting units where financial and statistical work has not been separated into distinct departments, the chief accountant or accounting supervisor will also be responsible for organizing and directing financial and statistical work.

c) For accounting units with large volumes of accounting work, a deputy head of the accounting department (or deputy head of the accounting division) may be appointed concurrently with the chief accountant. The deputy head of the accounting department (or deputy head of the accounting division) assists the chief accountant.

III. STANDARDS AND CONDITIONS FOR APPOINTMENT AS CHIEF ACCOUNTANT OR RESPONSIBLE PERSON FOR ACCOUNTING, OR FOR HIRING AS CHIEF ACCOUNTANT

1. Standards and conditions for appointment as chief accountant

a) Criteria for appointment as a chief accountant

- Regarding ethics: Must possess professional ethics, honesty, integrity, and a sense of compliance and struggle to protect economic, financial policies, systems, and laws of the State.

- Regarding professional qualifications:

+ For chief accountants of accounting units specified in Point 1, Section a, b of Point 3, and Point 4 of Part I of this Circular and chief accountants of subsidiary companies, they must have a college or university degree in accounting or higher;

+ For chief accountants of accounting units specified in Sections c, d of Point 3, Point 5, and Point 7 of Part I of this Circular and chief accountants of subsidiary companies of State-owned corporations, they must have a vocational qualification in accounting at the intermediate level or higher;

The chief accountant of the accounting unit of the higher-level accounting unit that has subordinate accounting units, the chief accountant of state-owned holding companies, and the chief accountant of the parent company must have a major and vocational training in accounting at the bachelor's level or above.

Specifically, for Vietnamese chief accountants working in foreign-invested enterprises established and operating in Vietnam, they must have language proficiency as required by the enterprise to serve transaction and work purposes.

- Regarding actual work experience in accounting:

+ For chief accountants of the accounting units specified in points 1, 2, sub-items a and b of point 3, and point 4, Part I of this Circular, and chief accountants of subsidiary companies, if they have a bachelor's degree, they must have at least two years of actual work experience in accounting; in case they have a major and vocational training in accounting at the associate degree level, they must have at least three years of actual work experience in accounting;

+ For chief accountants of the accounting units specified in sub-items c and d of point 3, point 5, and point 7, Part I of this Circular, and chief accountants of dependent subsidiaries of holding companies, if they have a major and vocational training in accounting at the secondary level, they must have at least three years of actual work experience in accounting; for those with a major and vocational training in accounting at the bachelor's level or above, they must have at least two years of actual work experience in accounting;

+ For chief accountants of the higher-level accounting unit that has subordinate accounting units, chief accountants of state-owned holding companies, and chief accountants of the parent company, they must have at least five years of actual work experience in accounting.

b) Conditions for appointment as chief accountant

- Must meet the criteria stipulated in sub-item a, point 1, Part III of this Circular;

- Hold a Chief Accountant Training Certificate pursuant to Decision No. 43/2004/QD-BTC dated April 26, 2004, of the Minister of Finance, or hold a Chief Accountant Training Certificate issued before Decision No. 43/2004/QD-BTC took effect, as prescribed in the Regulation on Organizing Training and Issuing Chief Accountant Certificates attached to Decision No. 159 TC/CĐKT dated September 15, 1989, and Decision No. 769 TC/QĐ/TCCB dated October 23, 1997, of the Minister of Finance;

- Not be among the persons prohibited from being an accountant as provided for in Article 51 of the Accounting Law.

c) Criteria and conditions for appointing a foreigner as chief accountant

A foreigner appointed as chief accountant in foreign-invested enterprises or Vietnamese enterprises must hold a Professional Accountant Certificate or an Accounting Certificate issued by a foreign organization recognized by the Ministry of Finance of Vietnam; or hold a Practice Certificate for Accountants or a Certified Public Accountant Certificate issued by the Ministry of Finance of Vietnam; or hold a Chief Accountant Training Certificate as prescribed by the Ministry of Finance; they must have at least two years of actual work experience in accounting, including one year working as an accountant in Vietnam; not be among the persons prohibited from being an accountant as provided for in Article 51 of the Accounting Law, and be permitted to reside in Vietnam for at least one year.

2. Criteria and conditions for appointing a person responsible for accounting

A person appointed as responsible for accounting must meet the moral and professional qualifications prescribed for chief accountants but may not yet have sufficient actual work experience in accounting or a Chief Accountant Training Certificate as stipulated in sub-item b, point 1 above.

3. Standards and conditions for individuals hired as chief accountant

A person hired as chief accountant must meet the following criteria and conditions:

a) Hold a Practice Certificate for Accountants as prescribed in Article 57 of the Accounting Law or a Certified Public Accountant Certificate as prescribed in Article 13 of Decree No. 105/2004/NĐ-CP dated March 30, 2004, of the Government on Independent Auditing;

b) Hold a Chief Accountant Training Certificate as prescribed by the Ministry of Finance;

c) Be registered to provide accounting services or be registered as an accountant or auditor in an accounting and auditing service enterprise as prescribed by law;

d) Not be among the persons prohibited from being an accountant as provided for in Article 51 of the Accounting Law.

IV. PROCEDURES FOR APPOINTMENT, REMOVAL, REPLACEMENT OF CHIEF ACCOUNTANT OR RESPONSIBLE PERSON FOR ACCOUNTING; HIRING AND TERMINATION OF CONTRACT WITH PERSONS HIRED AS CHIEF ACCOUNTANT

1. Procedures for appointing, dismissing, and replacing chief accountants and persons responsible for accounting

a) For state-owned enterprises specified in point 1, Part I of this Circular, when proposing to appoint, dismiss, or replace a person as chief accountant or responsible for accounting, they must prepare a dossier similar to the dossier for appointing Deputy Director or Deputy General Director for chief accountants; and a dossier for appointing Head of Department or Head of Division for persons responsible for accounting, and submit it to the competent authority as prescribed in Clause 1, Article 25 and Clause 2, Article 40 of the State-Owned Enterprise Law.

b) For organizations specified in points 2 and 3, Part I of this Circular, the procedures for appointing, dismissing, or replacing chief accountants or persons responsible for accounting are as follows:

- For limited liability companies specified in sub-items b and c of point 2 and sub-item a of point 3, Part I of this Circular, they shall implement according to the Company Charter and be decided by the Board of Members as prescribed in sub-item d, Clause 1, Article 35 of the Enterprise Law;

- For joint-stock companies specified in sub-items a, d, e, and f of point 2 and sub-item b of point 3, Part I of this Circular, they shall implement according to the provisions of sub-item e, Clause 2, Article 80 of the Enterprise Law, the Company Charter, and be decided by the Board of Directors;

- For partnership companies specified in sub-item c of point 3, Part I of this Circular, they shall implement according to the Company Charter and be decided by the Board of Members of the partnership company;

- For private enterprises specified in sub-item d of point 3, Part I of this Circular, the decision is made by the enterprise owner;

c) For foreign-invested enterprises and branches of foreign enterprises operating in Vietnam specified in points 4 and 5, Part I of this Circular, the procedures for appointing, dismissing, or replacing persons as chief accountant or responsible for accounting are as follows:

- For wholly foreign-owned enterprises and branches of foreign enterprises, the decision is made by the investor;

- For joint ventures between Vietnam and foreign countries, the decision is made by the Joint Venture Management Board.

d) For cooperatives specified in Point 7, Part I of this Circular when requesting to appoint, dismiss, or replace the chief accountant or accounting supervisor, they shall implement the provisions set forth in Point b, Clause 1, Article 27 of the Law on Cooperatives and such decisions shall be made by the Management Board of the Cooperative.

đ) For representative offices of foreign enterprises operating in Vietnam; individual business households and cooperative groups specified in Points 6 and 8, Part I of this Circular and basic-level accounting units of trading organizations that have multi-level accounting systems, the appointment, dismissal, or replacement of the accounting supervisor or chief accountant (if any) shall be decided by the legal representative of the accounting unit.

2. Procedures for signing contracts for hiring and terminating contracts for hiring accountants-in-chief

a) For enterprises and cooperatives which are accounting units required to arrange for an accountant-in-chief but instead hire someone to serve as the accountant-in-chief, the hiring of the accountant-in-chief must be decided by the authority with the power to appoint the accountant-in-chief as stipulated in Point 1 above.

b) The cost of hiring an accountant-in-chief under the service agreement with an accounting and auditing service enterprise or directly signing a service contract with a hired person who has registered for accounting services.

c) For enterprises and cooperatives which are accounting units that hire an accountant-in-chief, if the hired person violates the provisions in the contract, the contract will be terminated. The procedure for terminating the contract for hiring an accountant-in-chief shall be carried out according to the procedures for signing a contract for hiring an accountant-in-chief with an accounting and auditing service enterprise or with a person hired directly.

V. SALARIES OF ACCOUNTANT-IN-CHIEF AND ACCOUNTING SUPERVISORS

1. For state-owned companies specified in Point 1, Part I of this Circular, the accountant-in-chief shall be assigned a position salary according to the company's grade as stipulated in the salary table for General Directors, Directors, Deputy General Directors, and Accountant-In-Chiefs issued together with Decree No. 205/2004/NĐ-CP dated December 14, 2004 of the Government.

In cases where the aforementioned state-owned companies appoint someone to serve as an accounting supervisor, the accounting supervisor shall be assigned a professional and vocational salary and enjoy a position allowance equivalent to that of a Department Head of the same grade as stipulated in Item 6, Article 3 of Decree No. 205/2004/NĐ-CP dated December 14, 2004 of the Government.

2. For organizations engaged in business activities specified in Points 2, 3, 4, 5, and Point 7, Part I of this Circular, the salary of the accountant-in-chief and accounting supervisor shall be agreed upon and recorded in the labor contract according to the wage scale and salary table determined by the enterprise or cooperative.

3. For organizations engaged in business activities specified in Points 6 and 8, Part I of this Circular that assign someone to serve as an accounting supervisor or accountant-in-chief (if any), the salary of the accounting supervisor or accountant-in-chief shall be agreed upon and recorded in the labor contract.

VI. IMPLEMENTATION

1. Accounting units shall be responsible for:

a) Must appoint or assign individuals meeting the criteria and conditions to serve as the accountant-in-chief or accounting supervisor of the unit in accordance with Decree No. 129/2004/NĐ-CP and the guidance provided in this Circular;

b) Implement the regulations regarding the procedures for appointing, dismissing, and replacing the accountant-in-chief or accounting supervisor as stipulated in this Circular;

c) The decision to hire an accountant-in-chief must comply with the provisions of this Circular.

2. Ministries managing industries, provincial people's committees, and municipal people's committees directly under the central government shall be responsible for:

a) Directing and guiding business organizations to review their current team of accountant-in-chiefs; implementing the arrangement, procedures for appointing, dismissing, and replacing, and assigning salaries to accountant-in-chiefs and accounting supervisors, and hiring accountants-in-chief in accordance with the State's regulations;

b) Coordinating with financial and accounting academies, universities, and colleges, and the Vietnam Association of Accountants and Auditors to organize training courses for accountant-in-chiefs to qualify them for appointment;

c) For accounting units currently having a Head of Accounting Department or Head of Accounting Division, if they meet the criteria and conditions, they shall be appointed as an Accountant-In-Chief; if not, they shall be transferred to serve as an accounting supervisor.

3. The Ministry of Finance shall be responsible for:

a) Taking the lead in researching and guiding the supplementation of criteria, conditions, procedures for appointing, dismissing, and replacing accountant-in-chiefs and accounting supervisors, and hiring accountants-in-chief in accordance with the Accounting Law;

b) Coordinating with the Ministry of Labor, Invalids, and Social Affairs to inspect the implementation of the appointment, dismissal, replacement, and assignment of salaries for accountant-in-chiefs and accounting supervisors in business organizations in accordance with this Circular.

VII. IMPLEMENTATION PROVISIONS

1. Based on the contents stipulated in this Circular, ministries managing industries, provincial people's committees, and municipal people's committees directly under the central government shall direct business organizations to implement the appointment, dismissal, replacement, and assignment of salaries for accountant-in-chiefs and accounting supervisors, and hiring accountants-in-chief in accordance with the State's regulations.

2. This Circular shall take effect 15 days from the date of publication in the Official Gazette. The Circular No. 64-TT/LB dated December 12, 1990 of the Joint Ministry of Finance - Ministry of Labor, Invalids, and Social Affairs guiding the appointment and assignment of salaries for chief accountants and deputy chief accountants of state-owned enterprises is hereby abolished.

During the implementation process, if there are any difficulties, please report to the Ministry of Finance - Ministry of Labor, Invalids, and Social Affairs for consideration and resolution.