Circular No. 134/2016/TT-BTC on the Financial Management Regulations of Vietnam Asset Management Joint Stock Company

MINISTRY OF FINANCE -------	SOCIALIST REPUBLIC OF VIET NAM Independence - Freedom - Happiness ---------------
Number: 134/2016/TT-BTC	Hanoi, September 8, 2016

CIRCULAR

ISSUING REGULATIONS ON FINANCIAL MANAGEMENT OF VIETNAM ASSET MANAGEMENT COMPANY JOINT STOCK COMPANY

Pursuant to the Enterprise Law No. 68/2014/QH13 dated November 26, 2014;

Pursuant to the Law on Management and Use of State Capital for Production and Business Investment at Enterprises No. 69/2014/QH13 dated November 26, 2014;

Pursuant to Decree No. 215/2013/NĐ-CP dated December 23, 2013, promulgated by the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

Pursuant to the Government Decree No. 99/2012/NĐ-CP dated November 15, 2012 on the delegation and decentralization of the rights, responsibilities, and obligations of state owners towards state-owned enterprises and state capital invested in enterprises;

Pursuant to the Government Decree No. 87/2015/NĐ-CP dated October 6, 2015 on supervision of state capital investment in enterprises; financial supervision, evaluation of operational efficiency, and public disclosure of financial information of state-owned enterprises and enterprises with state capital;

Pursuant to the Government Decree No. 91/2015/NĐ-CP dated October 13, 2015 on state capital investment in enterprises and management and use of capital and assets in enterprises;

At the proposal of the Director of the Department of Enterprise Finance, the Board of Directors of Vietnam Asset Management Company Joint Stock Company.

The Ministry of Finance hereby issues this Circular along with the Financial Management Regulations of Vietnam Asset Management Company Joint Stock Company as follows:

Article 1. These Financial Management Regulations of Vietnam Asset Management Company Joint Stock Company are promulgated together with this Circular.

Article 2. This Circular takes effect from November 1, 2016 and replaces Decision No. 2857/QĐ-BTC dated November 9, 2012 of the Ministry of Finance on the Financial Management Regulations of Vietnam Asset Management Company Joint Stock Company.

Article 3. The Director of the Department of Enterprise Finance, Heads of relevant units, the Board of Directors, and General Director of Vietnam Asset Management Company Joint Stock Company are responsible for implementing this Circular./.

Place of Receipt: - Prime Minister, Deputy Prime Ministers; - Government Office; - Central Party Office and its Departments; - Office of the General Secretary; - National Assembly's Office; - President's Office; - Supreme People's Procuracy; - Supreme People's Court; - Central Steering Committee on Anti-Corruption; - State Audit Office; - Ministries, agencies equivalent to ministries, and government agencies; ||| - Central mass organizations; - People's Committees of provinces and centrally governed cities; - Official Gazette; - Ministry of Justice's Legal Documents Inspection Department; - Departments of Finance, Taxation Services, State Treasury of provinces and centrally governed cities; - Economic Groups; - State-owned Corporations; - Government website; - Ministry of Finance website; - Units under the Ministry of Finance; - TO BE FILED: VT, Department of Corporate Value.

DEPUTY MINISTER DEPUTY MINISTER Tran Van Hieu

REGULATIONS

FINANCIAL MANAGEMENT OF VIETNAM ASSET MANAGEMENT COMPANY JOINT STOCK COMPANY
(Issued together with Circular No. 134/2016/TT-BTC dated September 8, 2016 of the Ministry of Finance)

PART I

GENERAL PROVISIONS

Article 1. Scope and Applicability

These regulations stipulate the financial management mechanism for Vietnam Asset Management Company Joint Stock Company (hereinafter referred to as DATC or the Company) which is a state-owned enterprise converted according to Decision No. 1494/QĐ-BTC dated June 30, 2010 of the Minister of Finance based on restructuring the Company for Debt Purchase and Liquid Assets of Enterprises established according to Decision No. 109/2003/QĐ-TTg dated June 5, 2003 of the Prime Minister.

Article 2. General Principles

1. The Company shall establish ownership, management, and usage rights over purchased debts and assets (except for special cases decided by competent authorities), manage, use, and account for debts and assets in accordance with these regulations and current laws.

2. Each debt purchased by the Company (through agreement or designation) shall be treated as a special type of goods, and the Company shall be responsible for accounting and tracking each purchased debt.

3. For debts and assets received from 100% state-owned enterprises undergoing restructuring or ownership conversion or designated by competent authorities, after receiving them, the Company shall manage and track them outside the balance sheet and handle them in accordance with the law and these regulations.

4. The conversion of debts and assets into equity contributions tied to the restructuring of state-owned enterprises with 100% state capital shall be carried out according to agreed plans (in writing) with the competent authority deciding the enterprise restructuring plan, in compliance with the law on enterprise restructuring and ownership conversion. For other enterprises, the conversion of debts and assets into equity contributions tied to enterprise restructuring shall be conducted based on agreements with the enterprise's owner.

5. The use of debts and assets for equity contributions must ensure effectiveness based on approved investment plans (including plans to convert debts into equity contributions in restructured enterprises). Assets (excluding debts) before being contributed must be reassessed by appraisal organizations in accordance with the law.

6. When performing tasks of receiving, purchasing, and handling debts and assets as directed by competent authorities, the Company shall implement them based on appropriate plans in line with the directives of competent authorities and the Articles of Association of the company.

7. Companies with controlling equity stakes held by DATC through debt-to-equity conversion and DATC's plan to divest within a maximum period of five years from the date DATC officially becomes a shareholder in non-DATC subsidiaries. In special cases, DATC shall report to the Ministry of Finance for consideration and provide written comments. DATC shall not consolidate the financial statements of these companies.

Chapter II

SPECIFIC PROVISIONS

Mục I. MANAGEMENT AND USE OF CAPITAL

Article 3. Capital of the Company

1. The Company's owner's equity includes:

a) The registered capital of the Company according to the decision of the owner. The owner must provide sufficient registered capital to ensure the operation of the Company in accordance with the law.

b) Accumulated capital from business activities shall be added to the investment capital of the owner.

2. Capital raised by the Company through various forms of borrowing from credit institutions, financial organizations; borrowing from organizations, individuals outside enterprises, employees; issuing corporate bonds and other forms of raising capital in accordance with the provisions of the law.

Article 4. Raising Capital

1. Principles for raising capital:

a) Based on the five-year investment development strategy and the annual production and business plan of the Company;

b) The capital-raising plan must ensure efficiency and debt repayment capability;

c) The person approving the capital-raising plan is responsible for supervising and checking to ensure that the raised capital is used for its intended purpose and is effective;

d) The raising of capital from domestic organizations and individuals must be carried out through loan contracts with organizations and individuals in accordance with the law;

đ) The raising of capital from foreign organizations and individuals, loans or issuance of bonds guaranteed by the Government shall be implemented in accordance with the laws on public debt management and other relevant laws;

e) The raising of capital through the issuance of corporate bonds shall be carried out in accordance with the law and the Charter of the Company's organization and operations.

2. Authority to raise capital:

a) The Board of Members of the Company decides on the capital-raising plan for each project with a raising amount not exceeding 50% of the owner's equity recorded in the quarterly or annual financial report of the Company at the time closest to the time of raising capital but not exceeding the level of capital for Project Group B as stipulated in the Public Investment Law.

The raising of capital to serve production and business must ensure that the total amount of liabilities does not exceed three times the owner's equity of the enterprise recorded in the quarterly or annual financial report of the enterprise at the time closest to the time of raising capital, wherein:

- Owner's equity recorded in the balance sheet in the quarterly or annual financial report of the Company is determined to exclude the "other operating funds and reserves" indicator.

- Liabilities recorded in the balance sheet in the quarterly or annual financial report of the Company are determined to exclude the indicators: Reward Fund, Welfare Fund, Science and Technology Development Fund; Funds established at DATC pursuant to the Decision of the competent authority to implement assigned tasks, liabilities arising from the issuance of bonds, promissory notes and other debt instruments guaranteed by the Government to implement assigned tasks.

The Board of Members delegates to the General Director the authority to decide on the capital-raising plan within the scope of the Board of Members' authority;

b) In cases where the capital-raising exceeds the limit specified in point a of this clause, the Board of Members decides after proposing and obtaining approval of the Ministry of Finance or reporting to the competent authority for approval of the policy.

Article 5. Principles for Using Capital

The Company has the right to actively use its own capital to serve business activities in accordance with the principle of effectiveness, preservation, and development of capital, and in compliance with the law. Among which:

1. Using capital to purchase debts and assets for business purposes in accordance with the law; prioritizing support for the restructuring, reorganization, and ownership conversion process of state-owned enterprises.

The Board of Members specifies in detail the documentation, procedures for building, reviewing, and the authority to decide on the debt and asset purchase plans applicable within the Company in compliance with the law and this Regulation.

2. Using capital to carry out assigned tasks in accordance with the industry of the Company.

3. Using capital to repair and upgrade assets.

The Company may proactively use its operational capital to repair and upgrade assets to increase their value and facilitate the disposal of assets to recover capital. Costs for investment in renovation and upgrading of assets are accounted for as an increase in asset value. Activities involving investment in renovation and upgrading of assets that fall under basic construction investment must comply fully with the State's regulations on investment management and construction.

4. The use of capital for investment in fixed assets to serve the Company's operations must ensure:

- Appropriate equipment for the Company's operational needs and compliance with State regulations.

- Compliance with current legal regulations on basic construction investment and procurement of fixed assets.

- Accounting and tracking of invested and purchased assets in accordance with current legal regulations.

Article 6. Preservation of Capital

1. The Company shall be responsible for preserving and developing the State's invested capital at the Company.

2. Every six months and at the end of each year, DATC shall report to the Ministry of Finance on the changes and effectiveness in the use of the State's capital for monitoring and supervision.

3. The preservation of the State's capital at the Company shall be carried out through the following measures:

a) Implementing properly the management and use of capital, assets, profit distribution systems, other financial management systems, and accounting regulations as prescribed by law;

b) Purchasing asset insurance in accordance with legal regulations;

c) Promptly handling the value of lost assets, unrecoverable debts, and setting aside provisions for risks according to this regulation and the guidance of the Ministry of Finance;

d) Other measures for preserving the State's capital at the Company as prescribed by law.

4. Annually, DATC must evaluate the degree of capital preservation of the Company as follows:

a) After setting aside provisions according to Article 7 of this Regulation and the guidance of the Ministry of Finance, if the business results of the enterprise do not incur losses or generate profits, the enterprise preserves its capital.

b) In cases where, after setting aside provisions according to the guidance of the Ministry of Finance and Article 7 of this Regulation, the business results of the enterprise result in losses (including cumulative losses), the enterprise fails to preserve its capital.

Article 7. Setting Aside Provisions

1. The objects for setting aside provisions of the Company include:

a) Provision for reduction in inventory value:

- The Company shall set aside provisions for reduction in inventory value for Inventories (including assets that DATC purchases with operating funds according to agreements and directives, assets received to offset debts, assets awaiting disposal, including real estate).

- The Company does not need to set aside provisions for reduction in inventory value for assets received from state-owned enterprises undergoing restructuring, ownership transfer, or according to directives of competent authorities.

b) Provision for doubtful receivables:

- The Company shall set aside provisions for doubtful receivables in the following cases:

+ Debts that DATC purchases with operating funds according to agreements and directives.

+ Doubtful receivables arising from DATC's business activities.

- The Company does not need to set aside provisions for doubtful receivables in the following cases:

+ Debts received from enterprises undergoing restructuring, ownership transfer, or according to directives of competent authorities.

+ Receivables when the Company performs tasks according to directives of competent authorities.

c) Provision for loss of financial investment.

2. Some specific provisions:

a) For debts that DATC purchases with operating funds according to agreements and directives: Based on the debt recovery plan and the assessment of the debtor's ability to repay, DATC decides the level of provision setting aside based on the Regulation issued by the Company's Board of Members under Clause 3, Article 7 of this Regulation.

b) In cases where the divestment value is lower than the book value of the investment, DATC must set aside additional provisions sufficient to cover the loss of financial investments at the time of establishing the divestment plan according to this Regulation and current regulations.

c) For restructured enterprises, if at the time of setting aside provisions (year-end or the time of establishing the divestment plan), the financial statements have not been completed according to regulations, DATC may use the most recent financial statements of the restructured enterprise as the basis for setting aside provisions.

3. Based on legal regulations on debt management, the guidance of the Ministry of Finance, and the provisions of this Regulation, the Company's Board of Members shall be responsible for issuing a Regulation on setting aside provisions suitable for the Company's operational characteristics after obtaining the opinion of the Ministry of Finance.

Article 8. Investment of Capital Outside the Company

1. Principles for Investment of Capital Outside the Company

a) The company has the right to use assets (including money, fixed assets, current assets, and other assets) under its management to invest outside the company, ensuring efficiency, capital preservation, compliance with the charter and laws, and the investment development strategy and plan of the company approved by the owner.

b) The company shall not contribute capital or directly invest in real estate, nor shall it contribute capital or purchase shares in banks, insurance companies, securities companies, venture capital funds, stock investment funds, or securities investment companies, except in the following cases:

- Contributing capital through business restructuring activities carried out by state-owned enterprises with 100% state capital to reorganize and convert ownership;

- Investing and upgrading received assets, assets received in lieu of debt repayment (including land use rights) for exploitation and recovery;

- Other cases as decided by the competent authority.

c) In cases where the company has contributed capital or invested in areas specified in point b Clause 1 of this Article, the Board of Members must have a restructuring plan and a plan to transfer all invested capital according to regulations.

d) DATC may independently decide to buy and sell stocks, convertible bonds, and subscription rights to shares in enterprises where the company holds shares or has a restructuring plan to facilitate the restructuring of debtor enterprises and handle debts and assets purchased or received.

đ) DATC shall not invest outside the company in the following cases:

- Participating in contributing capital, purchasing shares, or acquiring another enterprise entirely where the manager or representative at that enterprise is the spouse, father, mother, father-in-law, mother-in-law, foster father, foster mother, son, adopted son, daughter, adopted daughter, brother, sister, brother-in-law, sister-in-law, brother's wife, sister's wife, or husband's sister, husband's wife of the Chairman and members of the Board of Members, Supervisory Board member, General Director, Deputy General Director, and Chief Accountant of the company.

- Contributing capital together with an enterprise in which DATC holds controlling equity to establish a joint-stock company, limited liability company, or implement a business cooperation contract.

e) The company shall not use assets leased for operation, borrowed, or held in custody (excluding received assets) to invest outside the company.

g) Annually, the company has the responsibility to report to the Ministry of Finance the situation and effectiveness of the company's investments for inspection and supervision according to regulations.

2. Forms of Investment Outside the Company

a) Contributing capital without participating in debt purchases to establish a joint-stock company or a limited liability company; business cooperation contracts that do not form new legal entities according to the law;

b) Using purchased assets and debts to contribute capital and convert debts into equity contributions in joint-stock companies, limited liability companies, and partnerships;

c) Purchasing shares in joint-stock companies and equity contributions in limited liability companies and partnerships according to the law;

d) Purchasing entire other enterprises according to the law;

đ) Purchasing government bonds, bonds, and other debt instruments; repurchasing bonds and bills issued by DATC (excluding repurchasing bonds and bills issued by DATC to fulfill assigned tasks by competent authorities); depositing money at the State Treasury and commercial banks in Vietnam to earn interest.

e) Other investments according to the law after obtaining written approval from the Ministry of Finance.

3. Authority to Decide on Investment Projects Outside the Company

a) The Board of Members of the company or the General Director, based on the delegation of the Board of Members, decides on investments outside the company not exceeding 50% of the owner's equity recorded in the quarterly or annual financial report at the time closest to the decision-making date but not exceeding the project group B capital limit according to the Public Investment Law;

b) For investments outside the company valued over 50% of the owner's equity recorded in the quarterly or annual financial report at the time closest to the investment decision date, the Board of Members decides after proposing and obtaining approval from the Ministry of Finance or reporting to the competent authority for approval.

4. Investment Activities Outside the Company Not Considered as Investments in Non-Core Businesses Include:

a) Investment activities involving the purchase of stocks, convertible bonds, and subscription rights distributed according to the number of stocks DATC currently holds in joint-stock companies undergoing restructuring to ensure holding ratios;

b) Investment activities arising from debt and asset purchases such as share capital contributions, joint ventures, joint operations using assets, converting debts into equity contributions; investing to exploit and lease received assets, collateral assets, and assets received in lieu of debt.

Article 9. Management of Capital Invested Outside the Company

DATC shall manage capital invested outside the company in accordance with the provisions of the Law on Management and Use of State Capital for Business Investment, the Charter, the Financial Regulation of the Company; the Remuneration Fund Regulation for Concurrent Positions, the Management Regulation for Representatives issued by the Board of Members, and other relevant laws, including:

1. Evaluating and monitoring the effectiveness of equity contributions formed from purchased assets, converting purchased debts into equity contributions at joint-stock companies, limited liability companies, and partnerships based on the approved debt purchase plan by the competent authority.

2. Managing and distributing remuneration to representatives according to the Remuneration Fund Management Regulation for Concurrent Positions issued by the Board of Members, consistent with this Regulation.

Article 10. Transfer of Capital Invested Outside the Company

1. Principles for Transferring Capital Investments

a) The transfer of capital investments outside the company (including the transfer of rights to purchase shares, rights to contribute capital to joint-stock companies, and limited liability companies with two or more members) must comply with the provisions of the Enterprise Law; management and use of state capital for business investment; securities; other relevant laws; the Charter of enterprises with the Company's capital contribution; and commitments made by the parties in joint venture and cooperation contracts.

b) Fully reflecting the actual value of the enterprise, including the value of land use rights in accordance with the law on land.

c) Ensuring market principles, transparency, and fairness.

2. In cases where the transfer price is close to the market price (the price has been appraised by an organization with appraisal functions in accordance with the law on appraisal), but the expected transfer value is still lower than the book value recorded in the Company's accounting books and the Company has already established a provision, the following measures shall be taken:

a) If the provision amount is equal to or greater than the difference between the expected transfer value and the book value recorded in the accounting books, the Board of Members or General Director of the Company shall decide to transfer to recover the capital invested outside.

b) If the provision amount is still less than the difference between the book value of the investment recorded in the accounting books and the expected transfer value, the Board of Members or General Director of the Company must report to the Ministry of Finance for review and provide written comments before transferring.

3. Methods for Transferring Capital Investments

a) Transferring Capital Investments Outside the Company:

- The transfer of DATC's capital investment in a limited liability company shall be carried out in accordance with the provisions of the Enterprise Law.

- The transfer of DATC's capital investment in a listed joint-stock company or a company registered for trading on the securities exchange shall be carried out in accordance with the Securities Law.

- The transfer of DATC's capital investment in a non-listed joint-stock company or a company not registered for trading on the securities exchange shall be conducted through public auction in accordance with regulations. In case the public auction is unsuccessful, competitive bidding through the sale of share lots shall be implemented. If competitive bidding is also unsuccessful, the transfer shall be carried out through negotiation.

- The starting price for the public auction shall be determined based on the results of the appraisal unit but shall not be lower than the book value of the investment minus the financial investment loss provision established at the time of formulating the capital transfer plan.

- For types of government bonds and corporate bonds that state-owned enterprises have invested to earn interest, the transfer shall be carried out in accordance with the issuance regulations or the issuance plan of the issuing entity (subject). In case a state-owned enterprise transfers bonds before maturity, the transfer price must ensure the principle of capital preservation during the transfer. The transfer of registered and listed bonds traded on the securities market shall be carried out in accordance with the Securities Law.

b) Transferring Capital Investments of DATC in Reorganized Enterprises Through Debt Purchase Activities:

- DATC must develop a plan to withdraw capital to recover investment after converting debt into equity contributions within a maximum period of five years from the date DATC officially becomes a shareholder in the restructured enterprise. In special cases, DATC reports to the Ministry of Finance for review and provides written comments.

- At non-listed joint-stock companies or companies not registered for trading on the UPCOM market, DATC may choose to hire intermediary financial organizations (securities companies, auction companies) to conduct auctions or organize auctions themselves or sell through the Stock Exchange in accordance with current laws. In case the public auction is unsuccessful, the transfer shall be carried out through negotiation but not lower than the starting price when conducting the most recent public auction. DATC is allowed to withdraw capital in the form of selling entire share lots or selling entire share lots accompanied by receivables according to the plan approved by the Board of Members.

4. Authority to Decide on Transfers of Capital

- The Board of Members decides on capital transfer plans with book values not exceeding 50% of the Company's owner's equity on the latest quarterly or annual financial statements at the time of the capital transfer decision. The Board of Members delegates or decentralizes authority to the General Director of the Company to decide on capital transfer plans within their authority.

- For capital transfer plans with book values exceeding 50% of the Company's owner's equity on the latest quarterly or annual financial statements at the time of the capital transfer decision, the Board of Members decides after proposing and obtaining approval from the Ministry of Finance or reporting to the competent authority for approval.

Section II. MANAGEMENT OF ASSETS

Article 11. Investment, Construction, and Procurement of Fixed Assets of the Company

1. The investment, construction, and procurement of fixed assets of the company shall be carried out in accordance with the provisions of the laws on the management and use of state capital for production and business activities at enterprises.

a) Authority to decide on investment, construction, and procurement projects of fixed assets:

- The Board of Members decides each investment, construction, and procurement project of fixed assets with a value not exceeding 50% of the company's equity recorded in the quarterly or annual financial report of the company at the time closest to the decision-making time but not exceeding the limit of Project Group B as stipulated in the Public Investment Law. The Board of Members delegates authority to the General Director of the company to decide on investment, construction, and procurement projects of fixed assets within the scope of the Board of Members' authority;

- In cases where the investment, construction, and procurement project of fixed assets has a value exceeding 50% of the company's equity recorded in the quarterly or annual financial report of the company at the time closest to the decision-making time but not exceeding the limit of Project Group B as stipulated in the Public Investment Law, the Board of Members decides after proposing and obtaining approval from the Ministry of Finance or reporting to the competent authority for approval;

b) Provisions for certain specific cases:

- For investments and procurements of fixed assets implemented by the company, the investment and construction process must comply with the relevant laws on construction, bidding, and other related laws;

- For investments and procurements of fixed assets brought in from outside for use, the company must comply with the relevant laws on bidding and other related laws;

- For investments and procurements of means of transportation (cars) serving leadership positions and general work, the company must ensure compliance with current standards and quotas for procurement and use to ensure transparency, thrift, and efficiency. The acquisition or replacement of means of transportation is decided by the Board of Members within their authority or by the General Director according to the delegation of the Board of Members;

2. Depreciation of fixed assets: The company implements in accordance with the guidelines of the Ministry of Finance;

3. Leasing, Pledging, and Hypothecation of Assets

The company has the right to lease, pledge, and hypothecate assets owned by the company based on the principle of effectiveness, preservation, and development of capital in accordance with the law, including:

a) The Board of Members or the General Director according to the delegation of the Board of Members decides on leasing contracts of assets with a value not exceeding 50% of the company's equity recorded in the quarterly or annual financial report of the company at the time closest to the decision-making time for leasing but the remaining value of the leased asset does not exceed the limit of Project Group B as stipulated in the Public Investment Law;

b) The Board of Members decides on leasing contracts of assets with a value exceeding 50% of the company's equity recorded in the quarterly or annual financial report of the company at the time closest to the decision-making time for leasing after proposing and obtaining approval from the Ministry of Finance or reporting to the competent authority for approval;

4. Liquidation and Sale of Fixed Assets

a) The company has the right to proactively and implement the liquidation and sale of fixed assets that are damaged, technologically obsolete, unused, or unnecessary in accordance with the principles of transparency, fairness, and compliance with the law;

b) Authority to Decide on the Liquidation and Sale of Fixed Assets:

- The Board of Members decides on liquidation and sale plans of fixed assets with a remaining value not exceeding 50% of the company's equity recorded in the quarterly or annual financial report of the company at the time closest to the decision-making time for liquidation and sale but not exceeding the highest limit of Project Group B as stipulated in the Public Investment Law. The Board of Members authorizes or delegates authority to the General Director of the company to decide on liquidation and sale of assets within the scope of the Board of Members' authority;

- The Board of Members decides on liquidation and sale plans of fixed assets with a remaining value exceeding 50% of the company's equity recorded in the quarterly or annual financial report of the company at the time closest to the decision-making time for liquidation and sale after proposing and obtaining approval from the Ministry of Finance or reporting to the competent authority for approval;

- In cases where the sale plan of fixed assets of the Company for Asset Management (DATC) cannot recover the full amount of invested capital, DATC must clearly explain the reasons for the inability to recover the capital before selling the fixed assets to implement supervision;

- In cases where newly invested and procured fixed assets have been completed and put into use within the first three years but have not achieved economic efficiency as approved by the competent authority, and DATC has no need to continue operating and using them, leading to the inability to recover the full amount of invested capital through the sale of assets, resulting in DATC being unable to repay loans according to loan agreements or loan contracts, then the responsibility of those involved must be clarified and reported to the representative body of the owner for handling in accordance with the law;

c) Methods of liquidation and sale of fixed assets:

- DATC carries out the liquidation and sale of fixed assets through public auction through an organization with the function of auctioning assets or the company can organize it publicly in accordance with the procedures and formalities prescribed by the law on asset auctions. In cases where the remaining value of fixed assets recorded in the accounting books is less than 100 million VND, the General Director of the company decides to choose between auction or negotiation sales but not lower than market prices. In cases where fixed assets do not have transactions on the market, the company may hire an organization with the function of valuation to determine the price as the basis for selling assets through the above methods;

- In cases where the liquidation and sale of fixed assets are attached to land, they must be carried out in accordance with the laws on land.

d) The procedure for liquidation and sale of fixed assets shall be carried out in accordance with current regulations applicable to enterprises wholly owned by the State.

5. The company must establish a Property Management Regulation to clearly define the responsibilities of each stage in property management; organize accounting to fully, accurately, and promptly reflect such activities; organize inventory and reconciliation periodically or upon the owner's request; implement investment, management, and utilization of properties in accordance with the law and this Regulation.

Article 12. Management of purchased assets and received assets

1. Forms of asset disposal

a) Selling purchased assets (including replacement assets received to settle debts), received assets, and collateral assets for debt.

b) Using assets to contribute capital to joint-stock companies, joint ventures, or joint operations.

c) Leasing assets or exchanging them for use in business operations.

d) Preserving, repairing, upgrading, and renovating assets for sale, leasing, contribution of capital, or use in business operations.

2. Principles of asset disposal

a) The valuation of assets to determine the initial selling price or negotiation price for contributing capital to joint-stock companies, joint ventures, joint operations, or exchanges shall be conducted in accordance with the law applicable to enterprises wholly owned by the State.

b) Selling assets through direct negotiation, competitive bidding, or public auction must ensure transparency and fairness and comply with legal provisions.

Selling assets through direct negotiation can only be implemented after a public auction or competitive bidding has been conducted according to legal provisions but fails to succeed. Organizing a public auction must comply with legal provisions; in cases of transferring land use rights, the company must follow legal provisions on land.

c) Specifically, the disposal of received assets from enterprises undergoing restructuring and ownership conversion shall be carried out in accordance with Articles 7 and 8 of Circular No. 57/2015/TT-BTC dated April 24, 2015, issued by the Ministry of Finance, guiding the handover, receipt, and handling of debts and excluded assets during enterprise restructuring and ownership conversion by the State-owned enterprises (hereinafter referred to as Circular No. 57/2015/TT-BTC).

d) The disposal of received assets and designated purchases must strictly follow the approved plan for designated asset purchase, sale, and disposal by the competent authority.

3. Accounting for proceeds from asset disposal

a) For assets purchased through negotiation (including assets received in lieu of debt) and designation:

- The proceeds from selling assets and leasing assets are the revenue of the Company.

- The value of assets contributed to joint-stock companies, joint ventures, joint operations, or business cooperation is considered an investment of the company and shall be accounted for in accordance with legal provisions. Any difference between the book value and the value of assets contributed shall be handled in accordance with current regulations applicable to enterprises wholly owned by the State.

- The value of non-determined offset assets received is considered revenue of DATC. The company shall increase the value of assets awaiting disposal corresponding to the offset debt value at the time of receiving the offset asset. If the offset debt value exceeds the recorded purchase cost on the books, the value of assets awaiting disposal shall be accounted for based on the remaining purchase cost on the books.

Based on the results of disposing of assets awaiting disposal, DATC shall account for it similarly to the disposal of agreed-upon purchased assets.

b) For assets received from enterprises undergoing restructuring and ownership conversion:

- In cases where DATC sells or temporarily leases the assets while waiting for other forms of disposal, the entire amount received (excluding VAT as prescribed) shall be recorded as payable liabilities on the Balance Sheet and handled as follows:

+ Allocate 30% of the proceeds from recovering and disposing of received assets and record it as revenue from debt and asset recovery operations.

+ Allocate up to 10% of the proceeds from recovering and disposing of received assets to repay the enterprise holding the asset in accordance with Clause 2, Article 9 of Circular No. 57/2015/TT-BTC.

+ The remaining amount shall be remitted to the Enterprise Restructuring and Development Support Fund in accordance with Clause 4, Article 9 of Circular No. 57/2015/TT-BTC.

- In cases where DATC disposes of received assets through contributions, leasing, or exchanges for use in business operations:

+ Before disposal, the value of assets must be revalued by organizations with the function of valuation in accordance with the law.

+ Based on the revalued value, DATC shall pay a maximum of 10% of the revalued value to the enterprise holding the asset (if any) at the time of putting the asset into operation.

+ DATC shall increase the value of assets corresponding to the re-evaluated value, simultaneously increasing the owner's equity by the re-evaluated value minus any payments made to the enterprise holding the asset (if any). After recording, the asset belongs to DATC and shall be managed, utilized, and exploited in accordance with legal provisions.

- Proceeds from enterprises disposing of assets before transfer and recovered values of lost or missing assets during the holding period shall be recorded as payable liabilities on the Balance Sheet and handled as stipulated in the first bullet point under point b, Clause 3 of this Article.

Section III. DEBT MANAGEMENT

Article 13. Responsibilities of the Company

1. The company shall be responsible for establishing and promulgating the Debt Management Regulation in accordance with current regulations (including receivables, which include purchased debts, received debts; payables); assigning and clearly defining the responsibilities of collectives and individuals in tracking, recovering, and settling debts; reconciling, confirming, classifying debts, urging recovery, and proactively handling debts in accordance with the Articles of Operation, this Regulation, and related provisions.

2. Maintaining ledgers to track, account for, and settle debts according to each debtor; receivables, payables (including interest receivable and payable) regularly classify debts based on age (debts not yet due, debts due but not settled, overdue debts, difficult-to-collect debts, unrecoverable debts); by nature of the debt (long-term debts, short-term debts, preferential loans, commercial loans, foreign loans, government-guaranteed loans (including receivables and payables arising from government directives)).

3. Regularly reviewing, evaluating, analyzing payment capacity, urging recovery of debts, preventing the occurrence of overdue payables and unrecoverable receivables; periodically reconciling accounts receivable and payable.

4. DATC shall be responsible for setting aside provisions for difficult-to-collect receivables in accordance with Article 7 of this Regulation.

5. For debts denominated in foreign currency, DATC must maintain ledgers in the original currency (including principal and interest), convert to Vietnamese Dong (VND), revalue, and handle exchange rate differences in accordance with regulations.

6. For debt purchase plans, separate files shall be established for tracking and managing outside the balance sheet value of the debt principal as a basis for tracking and reconciling the debt ledger with the debtor and assessing the effectiveness of the plan; for received debts, DATC shall be responsible for tracking outside the balance sheet, managing appropriately according to the nature and duration of the received debts to monitor their resolution.

7. For debts purchased under directive, received under directive, and debts arising from performing tasks under directive, DATC shall be responsible for developing plans that comply with the directives of the competent authority. DATC shall conduct separate tracking and accounting as a basis for determining the results of task execution.

8. In case difficulties and obstacles arise during implementation, resulting in overdue payments or unrecoverable debts, DATC shall report to the Ministry of Finance for consideration and resolution within its authority or report to the competent authority for consideration and decision.

9. Unrecoverable receivables (excluding receivables arising from performing tasks under directive from the Government or Prime Minister) shall be clearly identified as either objective or subjective reasons. For subjective reasons, DATC shall be responsible for processing compensation from relevant collectives and individuals. For objective reasons, the Board of Members, Management Board, and relevant departments shall clearly identify the reasons and prepare confirmation records; if these debts are related to business operations, they may be offset by provisions for difficult-to-collect receivables; any remaining amount shall be recorded as business expenses of the company.

10. After handling unrecoverable debts in accordance with regulations, DATC shall continue to track them outside the balance sheet and disclose them in financial statements for at least ten years from the date of handling, and take measures to recover the debts; if the debts are recovered, the net proceeds after deducting related costs shall be recorded as other income.

11. Developing repayment plans, balancing cash flows to ensure debt repayment; Settling payables according to the agreed deadlines; Managing and operating to ensure the ability to repay debts (excluding payables arising from performing tasks under directive from the competent authority); being responsible for early detection of difficulties in debt repayment to promptly address them and prevent the occurrence of overdue payables; in cases where timely resolution is not achieved leading to overdue payables exceeding six months without settlement, based on the consequences of untimely resolution, the owner shall decide on disciplinary actions in accordance with regulations; in cases where timely resolution is not achieved leading to inability to repay debts, responsibility shall be borne before the owner and the law.

12. When DATC is unable to fully settle its debts and other financial obligations due, the General Director shall report to the Board of Members to find solutions to financial difficulties and inform all creditors of DATC's financial situation. In such cases, the Chairman of the Board of Members, members of the Board of Members, and the General Director of DATC shall not increase salaries, set aside profits, or pay bonuses to management staff and employees of DATC. Specifically, for payables arising from DATC performing tasks under directive from the Government or Prime Minister, DATC shall be responsible for reporting to the competent authority in cases where it cannot ensure the ability to settle due debts so that the Ministry of Finance and the Government can consider and take appropriate measures.

13. DATC is permitted to exclude receivables and payables when performing tasks under directive from the competent authority to evaluate, supervise state capital investment, monitor financial conditions, assess operational efficiency, and publicly disclose financial information of DATC.

Article 14. Handling receivables arising during business operations (excluding debts from purchases, received debts, and debts arising during the execution of tasks designated by the Government or Prime Minister).

1. The company shall handle receivables arising during business operations in accordance with the laws on managing debts for wholly state-owned enterprises.

2. Forms and measures to handle debts

a) Organizing direct collection or through legal debt collection service providers operating in Vietnam.

b) Handling through write-off, deferral, or cancellation of debts.

c) Selling receivables in accordance with the law, including overdue receivables, difficult-to-collect receivables, and uncollectible receivables, to recover capital based on the principle of fully provisioning according to regulations, without directly selling debts to the debtor. The sale price of receivables is agreed upon by the parties involved and they bear responsibility for the decision to sell the receivable.

In cases where selling debts leads to the company suffering losses, losing capital, or losing its ability to pay, resulting in the company being dissolved or declared bankrupt, the Board of Members must clarify the responsibility of relevant collectives and individuals to compensate according to the law, the Charter of Operations, and this Regulation.

3. Specific provisions:

a) Handling receivables that still have the potential to be recovered:

For receivables that still have the potential to be recovered, DATC must actively urge payment and apply all measures to recover them. In cases involving guaranteed receivables, secured receivables, debtors undergoing dissolution or bankruptcy procedures..., DATC must continue to take measures to recover debts in accordance with relevant laws related to the nature of the debt.

b) Handling receivables that cannot be recovered:

- Clearly identifying the causes, responsibilities of collectives and individuals, and demanding compensation from collectives and individuals according to the Debt Management Regulations issued by the DATC Board of Members.

- Using the reserve fund for difficult-to-collect receivables to offset losses.

- When implementing debt sales in accordance with the law, after clearly identifying the causes, responsibilities of collectives and individuals, and requesting compensation if necessary, the difference between the value of the receivable and the sale price will be offset by the reserve fund for difficult-to-collect receivables. If insufficient, it will be recorded as a business expense of the company.

- For uncollectible receivables that have been processed (except in cases of debt sales), but the debtor still exists, DATC has the responsibility to monitor outside the balance sheet and in the financial statement notes for a minimum period of 10 years from the date of processing. If the debt is recovered, the amount recovered minus related expenses will be recorded as other income.

c) Handling debt cancellations:

Object and conditions for considering and writing off debts

- For economic organizations:

+ Debtors who have completed dissolution or bankruptcy according to the law: Court decisions declaring bankruptcy under the Bankruptcy Law or decisions by authorized persons regarding the dissolution of the debtor enterprise, in cases of self-dissolution, there is a notification from the unit or confirmation from the establishment authority.

+ Debtors are enterprises or organizations that have ceased operations and are unable to pay, with no successors to assume the obligation to repay: Confirmation by the establishment authority or registration agency of the enterprise or organization, or the tax authority that the enterprise or organization has ceased operations and is unable to pay.

- For individuals, one of the following documents must be provided:

+ A copy of the death certificate or confirmation from local authorities for debtors who have died or gone missing but have no inheritable assets to repay the debt.

+ Confirmation from local authorities for debtors who are alive but unable to work or heirs who are unable to repay the debt.

+ Warrants for arrest or confirmation by law enforcement agencies regarding debtors who have lost their capacity to act civilly: have fled or are currently being prosecuted or serving a prison sentence.

Article 15. Debt Collection and Reception

1. Forms of debt collection

a) Directly recover debts from debtors;

b) Process collateral assets to recover debts;

c) Sell debts to other organizations or individuals (excluding debtors);

d) Accept assets in lieu of debt;

đ) Accept transfer of debt repayment obligations from debtors to third parties;

e) Entrust debt recovery or recover debts through legally operating debt collection service organizations in Vietnam;

g) Convert debts into capital contributions at debtor enterprises;

h) Initiate legal proceedings to claim debts;

i) Other forms consistent with legal provisions and decisions of competent authorities.

2. During the debt collection process, depending on each case, the Company may consider and handle according to the following forms:

a) Restructure debt repayment terms by means such as: write-off, deferment (extension) of debt, in accordance with the debtor's ability to repay based on specific conditions for debt recovery; consistent with the ability to monitor business operations of DATC towards debtor enterprises, ensuring effective debt purchase plans.

b) The Board of Directors of the Company considers writing off part of the interest debt according to the progress of principal repayment on the principle of still ensuring effective debt recovery plans.

- In cases where debtors fully repay the principal within 12 months from the date they commit to repaying the full principal, the Board of Directors of the Company will consider waiving interest after the full repayment of the principal according to the commitment but must ensure effectiveness according to the approved debt purchase plan.

- In cases where debtor enterprises suffer losses and have repaid the debt according to their commitments within six months, DATC can write off additional principal debt for enterprises but must ensure economic efficiency of DATC according to the approved plan; the amount of principal debt written off in this case shall not exceed the cumulative loss of the enterprise and shall not exceed the difference between the book value of the debt and the cost of purchasing the debt up to the time of debt write-off;

c) For purchased debts, DATC adjusts the interest rate of the debt in accordance with the debtor's ability to repay and market conditions, but not lower than the average interest rate for 12-month term deposits published by the trading floors of four major commercial banks (Vietcombank, Vietinbank, Agribank, BIDV) at the same time when considering interest rate adjustments. The 12-month term deposit interest rate of each bank is the 12-month term deposit interest rate announced on the bank's website or specified in a written notice defining the applicable interest rate for organizational customers.

d) Recovering debts through assets (including land use rights) is decided by the Board of Directors of the Company. Assets received in lieu of debt must have legal ownership and usage rights documentation (for land use rights). The value of assets received in lieu of debt must ensure high liquidity, efficiency when exploited, and be agreed upon by all parties. Before acceptance, the asset must be appraised through an organization with appraisal functions.

đ) Agree with debtors and third parties to implement the transfer of debt repayment obligations from debtors to third parties on the principle of mutual agreement among the three parties and must ensure greater convenience for DATC in recovering the debt, wherein the value of the transferred debt is not determined as revenue of DATC;

e) Converting debt into capital contributions must be unanimously agreed upon by the owners of debtor enterprises and implemented in accordance with the Company's Articles of Operation and this Regulation.

g) Selling debts through direct negotiation with buyers in accordance with legal provisions when meeting one of the following situations:

- After selling debts through public auction but failing to sell.

- Before DATC signs a debt purchase contract, there are customers who commit to buying back part or all of the debt, while meeting DATC's conditions regarding price, payment, and deposit or the ability to participate in enterprise restructuring or support enterprises after restructuring.

h) Selling collateral assets (including land use rights) of purchased debts. The sale of collateral assets for debts is carried out based on agreements between DATC and debtor enterprises, ensuring compliance with relevant legal provisions. In cases involving the sale of land use rights, it must be conducted in accordance with the laws on land.

i) Debt Write-off

- For received debts:

+ Annually, the Company conducts reviews and classifications to assess the recoverability of received debts.

+ For received debts that are unrecoverable and have been monitored outside the balance sheet by DATC for over ten years (including the period monitored by the enterprise before transferring to DATC if applicable), DATC compiles files and reports to the Ministry of Finance for consideration and decision to exclude them from further monitoring on accounting books.

- For debts purchased through agreement or designated purchase using DATC's operating capital, the Company writes off debts in the following cases:

+ Criteria and conditions for considering and writing off debts: Applied as stipulated in Point 3.3 Clause 3 Article 14 of this Regulation.

+ When handling debt write-offs, the Company must prepare individual files for each debtor and clarify the responsibility of collectives and individuals involved in purchasing debts without recovery, report to the Board of Directors for consideration and decision on debt write-off within the scope of debt purchase plans under the Board's authority. The source of debt write-off is the difference between the book value of the debt and the cost of purchasing the debt. If the amount of debt written off exceeds this difference, it is covered by the reserve for doubtful receivables. If the reserve is insufficient, the shortfall is recorded as a business expense of the Company.

3. Accounting for Revenue from Debt Collection and Reception

a) For negotiated and designated purchases:

- Amounts recovered from debtors through payments or sales of debts or collateral assets are revenue of the Company.

- In the case where capital contribution arises from the difference between the value of the debt and its original purchase price, DATC only records and monitors the investment at par value outside the balance sheet. In the case where debt is converted into capital contribution based on the purchase cost, the company increases the value of the contributed capital investment and records a reduction in the original purchase cost of the debt by the amount of the debt converted into capital contribution at the time of conversion. The company shall record revenue and expenses when transferring the contributed capital according to current regulations.

- In the case where an agreement is reached with the debtor and a third party to transfer the obligation to repay the debt from the debtor to the third party, the transferred debt value is not recognized as revenue for DATC.

b) For received debts:

- Revenue from the recovery and handling of received debts shall be recorded in accordance with Article 9 of Circular No. 57/2015/TT-BTC dated April 24, 2015, issued by the Ministry of Finance guiding the handover, receipt, and handling of debts and excluded assets when restructuring and ownership transfer of state-owned enterprises holding 100% of charter capital, specifically as follows:

All revenue from the recovery and handling of received debts (excluding VAT as prescribed) shall be recorded as accounts payable on the Balance Sheet and handled as follows:

+ DATC records 30% of the revenue from the recovery and handling of received debts mentioned above as revenue from debt and asset handling activities.

+ DATC may allocate up to 10% of the revenue from the recovery and handling of received debts mentioned above to transfer to the enterprise to cover management and custody costs (if any) according to Clause 2, Article 9 of Circular No. 57/2015/TT-BTC.

+ The remaining amount shall be remitted to the Enterprise Restructuring and Development Support Fund in accordance with Clause 4, Article 9 of Circular No. 57/2015/TT-BTC.

- Cases of recovery and handling of received debts: The recovered debt amount (revenue from the enterprise for debts processed before handover, revenue from the debtor, interest revenue due to late payment by the enterprise before handover); revenue from selling received debts; revenue from selling, leasing, and exploiting collateral assets, shall be recorded as revenue from the recovery and handling of received debts according to the first item of Point b of this clause.

Article 16. Debt Handling Linked to Enterprise Restructuring

Converting debt into capital contribution linked to the restructuring of the debtor enterprise must be based on the approved restructuring plan, following the principle of agreement between DATC and the enterprise owner, facilitating the implementation of restructuring, management, supervision of the enterprise, and divestment if necessary.

1. DATC implements a reduction in the debtor's repayment obligations during the execution of the restructuring plan and ownership transfer according to the following principles:

- For state-owned enterprises undergoing restructuring and ownership transfer:

+ The reduction in repayment obligations must be linked to the restructuring and ownership transfer plan in accordance with the laws on the transfer of state-owned enterprise ownership.

+ The maximum reduction in repayment obligations equals the negative equity value determined by the authorized body in the enterprise restructuring valuation report, minus the reduction in repayment obligations of other creditors (if any), and does not exceed the difference between the book value of the debt and the purchase cost of the debt as of the date of the decision to reduce the repayment obligation.

+ From the date of determining the enterprise value to the formal date of becoming a joint-stock company, if the restructuring enterprise incurs losses, the representative of the owner shall instruct the restructuring enterprise to clarify the causes and responsibilities of related collectives and individuals to take corrective measures and compensation as prescribed, and the remaining loss shall be considered and implemented further by DATC and participating creditors to reduce part of the repayment obligation if there is a surplus difference to handle according to regulations.

- The reduction in repayment obligations for enterprises other than state-owned enterprises undergoing restructuring and ownership transfer must be linked to the plan to convert debt into capital contribution approved by the authorized body of DATC. The maximum reduction shall not exceed the negative equity value on the most recent audited financial statement of the debtor enterprise by an independent auditing organization and shall not exceed the difference between the book value of the purchased debt and the purchase cost of the debt as of the date of the decision to reduce the repayment obligation.

- The reduction in repayment obligations for debtors shall not change the responsibility of organizations and individuals who caused financial losses previously.

- Specifically, for debtor enterprises that DATC restructures and holds more than 50% of the charter capital, if the debtor enterprise has paid DATC enough to cover the full purchase cost of the debt within 12 months from the commitment date, DATC will consider continuing to reduce the repayment obligation to offset accumulated losses if there is a surplus difference to handle.

- There should be a plan to divest shares to recover the investment after converting debt into capital contribution within a maximum period of five years from the date DATC officially becomes a shareholder in the restructured enterprise. In special cases, DATC reports to the Ministry of Finance for consideration and provides comments in writing.

2. At the end of the debtor enterprise restructuring process, DATC is responsible for requesting the debtor enterprise to confirm the continued debt and organizing the collection of the debt according to the agreed plan.

Article 17. Handling Payable Debts

1. Payable debts without identifiable debtors shall be recorded as income of the Company.

2. When raising capital through the issuance of government-guaranteed promissory notes or bills at the Prime Minister's directive to fulfill assigned tasks, DATC shall implement according to the approved project by the competent authority.

3. Debts arising from the execution of tasks assigned by the Government or the Prime Minister, DATC shall implement the debt resolution plan as directed by the competent authority, separately tracking to clearly determine the results of the task execution.

In case difficulties or obstacles arise during the handling process, DATC shall report to the Ministry of Finance for consideration and resolution within its authority, or report to the Government or the Prime Minister for guidance.

Article 18. Salary Fund and Dual Position Fees

1. The salary fund of DATC shall be determined in accordance with current regulations applicable to state-owned enterprises holding 100% of the charter capital. Management, distribution, and utilization of the fund shall be carried out in accordance with the Regulations issued by the Board of Members of DATC.

2. Dual position fees are used to pay DATC staff members including business managers of DATC, DATC staff members appointed to directly hold positions in other enterprises, and DATC staff members participating in managing or supporting the management of capital in other enterprises.

Dual position fees shall be sourced from the actual remuneration paid by enterprises with DATC's equity contribution to DATC staff members (including business managers) appointed to concurrently hold positions in other enterprises and shall be paid according to the following principles:

- Dual position fees shall be paid based on the level of task completion, but not exceeding 50% of the actual salary received at the Company;

- Unpaid dual position fees in a year may be used for payment in subsequent years.

Section IV. MANAGEMENT OF REVENUE, EXPENSES AND BUSINESS RESULTS

Article 19. General Principles

1. Revenue and expenses of the Company shall be determined in accordance with accounting standards; the Articles of Operation, this Regulation, tax laws, and other relevant legal documents.

2. For plans to buy, sell, and accept debts and assets as directed by the competent authority, DATC shall record business income and expenses in accordance with the approved plan.

3. In cases where revenue is insufficient to cover expenses due to the execution of tasks assigned by the competent authority, DATC shall have the responsibility to report to the Ministry of Finance for consideration and resolution within its authority, or report to the Government or the Prime Minister for consideration and guidance.

Article 20. Revenue and Other Income

Revenue and other income of DATC include:

1. Revenue from business activities includes:

a) Revenue from debt and asset management activities:

- Revenue from debt and asset management activities involving negotiated and designated purchases:

+ Revenue from debt management:

(i) Amounts collected from debtors;

(ii) Amounts from selling debts and collateral assets (including land use rights);

(iii) Rental and exploitation income from collateral assets;

+ Revenue from asset management:

(i) Proceeds from selling assets;

(ii) Rental and exploitation income from assets;

- Revenue from debt and asset management activities received:

+ Revenue from managing received assets: the amount DATC receives from the proceeds of managing received assets as stipulated in Point b Clause 3 Article 12;

+ Revenue from managing received debts: the amount DATC receives from the proceeds of managing received debts as stipulated in Point b Clause 3 Article 15.

b) Revenue from transferring investment outside the Company:

- Proceeds from transferring equity contributions formed from buying and selling, debt and asset management, and corporate restructuring activities;

c) Revenue from other activities

2. Financial activity revenue, including interest income from purchasing treasury bills and bonds; interest income from deposits; late interest payments, dividends (excluding dividend shares), and profits distributed from joint stock investments, joint venture investments, and business cooperation activities; the difference between the recovery value and the book value plus related transfer costs when transferring investments outside the company (excluding investments formed from contributing purchased assets, received assets, and converting debts into equity contributions in restructured enterprises).

3. Other income, including proceeds from liquidation sales of fixed assets, contract breach penalties, customer deposit refunds; income from non-recurring activities; the difference between the recognized contribution value and the book value of the asset.

Article 21. Expenses of the Company

1. Business operation expenses:

a) Costs of debt and asset management activities

- The cost of purchasing debts transferred to expenses in the period is specified as follows:

+ In the case of one-time recovery or sale of debts:

(i) In cases where debts are sold or recovered in one lump sum, the entire purchase cost of the debt is transferred to expenses in the period.

(ii) In cases where debt sale revenue is less than the corresponding purchase cost of the debt, the remaining purchase cost of the debt is transferred to expenses in the period.

+ In the case of multiple recovery of debts:

(i) In cases where debt management revenue (recovered from debtors; exploiting and selling collateral assets) exceeds the purchase cost of the debt at the time of recovery: the entire purchase cost of the debt is transferred to expenses in the period.

(ii) In cases where debt management revenue (recovered from debtors; exploiting and selling collateral assets) is less than the purchase cost of the debt at the time of recovery: a portion of the purchase cost of the debt equal to the actual revenue from debt management is transferred to expenses in the period. The remaining purchase cost of the debt will continue to be transferred to expenses according to the above principle when the debt continues to be managed and recovered.

- Costs of purchasing and selling assets: including the purchase cost of the asset and other related costs (transportation costs, repairs, upgrades, land rental...) shall be recorded as expenses in the period when there is income from asset management as follows:

+ In cases of asset sales: the entire purchase cost of the asset is transferred to expenses in the period.

+ In cases of asset rentals: DATC shall depreciate the asset and record related costs as expenses in the period in accordance with regulations.

- Direct expenses related to debt and asset processing, enterprise restructuring:

+ Provisions for setting up, reversing (if any) bad debt provisions, asset provisions, and investment loss provisions as stipulated in this Regulation;

+ External service rental costs related to debt and asset processing:

(i) Asset protection costs;

(ii) Appraisal costs, organization costs for auctioning debts and assets for sale, lease, contribution, joint venture, joint operation, business cooperation using debts and assets;

(iii) Appraisal costs, organization costs for auctioning when transferring financial investments;

(iv) Independent audit fees;

(v) Debt collection fees;

(vi) Execution fees;

(vii) Litigation and criminal participation fees (if any);

(viii) Advertising and newspaper publication fees;

(ix) Costs for other related services in handling debts and assets.

+ Costs for DATC staff dispatched to enterprises with DATC equity contributions or enterprises undergoing restructuring (travel costs, accommodation rental costs,...);

+ Other costs related to debt and asset management activities, corporate restructuring.

+ Securities deposit fees; transaction fees when transferring financial investment assets.

b) Costs for handling debts and received assets:

- Discount costs for customers to recover debts quickly;

- Repair and upgrade costs for assets (if any): These costs are recorded as asset items on the Balance Sheet upon occurrence and are transferred to direct costs for handling debts and received assets when income from upgraded and repaired assets is generated.

- External service rental costs related to debt and asset management, divestment;

- Other costs related to handling debts and received assets.

c) Divestment activity costs during the period:

- Value of equity contribution transferred:

+ In cases where revenue from selling all or part of a large investment exceeds the corresponding book value, the entire value of the financial investment is fully transferred to costs for the period.

+ In cases where revenue from selling all or part of a financial investment is less than the corresponding book value, after using reserve funds to cover the difference, DATC records the remaining value according to the book value of the investment as costs for the period.

d) Brokerage commission costs:

The company incurs brokerage commission costs in debt recovery, selling debts, and assets, and must ensure the following principles:

- The company's expenditure on brokerage commissions must ensure economic efficiency. The Board of Members of the Company bases on current state regulations and specific characteristics of the Company to establish and issue a uniform and publicized brokerage commission expenditure regulation within the Company. The Board of Members and General Director of the Company are responsible under the law for the company's commission expenditure decisions.

- The recipients of commission payments are organizations and individuals (both domestic and foreign) that provide brokerage services to the Company.

- Brokerage commissions shall not be applied to designated customers, management positions, or employees of the Company.

- Expenditure on brokerage commissions must be based on contracts or confirmation letters between the Company and the recipient, which must include the following basic contents: name, address, identification number of the representative of the recipient; details of expenditure (clearly stating the results of debt and asset handling contributed by the recipient of the commission); amount of expenditure; payment method, implementation and completion time; responsibilities of the parties.

2. Management costs:

The Company's management costs are implemented according to the Internal Expenditure Regulation issued by the Company's Board of Members in accordance with current state regulations applicable to wholly state-owned enterprises. Among these:

- Wages are implemented according to Article 18 of this Regulation;

- Expenditures for employees: Mandatory insurance purchase expenses; Health accident insurance expenses; contributions to voluntary pension funds, social welfare funds, voluntary pension insurance purchases, life insurance purchases;

- Expenses for the activities of Supervisors;

- Provisions for various reserves as stipulated in Article 7 of this Regulation;

- Other expenses as prescribed by law.

a) Other expenses related to investments outside the Company such as: expenses that capital contributors must bear themselves, losses shared (if any) from joint venture contracts, losses (if any) attributable to the Company corresponding to its share in the invested enterprises;

- Other expenditures related to external investments such as: expenses that capital contributors must bear themselves, losses shared (if any) from business cooperation contracts, losses (if any) attributable to the Company corresponding to its share of capital in invested enterprises.

- Differences smaller than the recovery value compared to the book value plus (+) transfer expenses and related expenses incurred when transferring investments outside the company (excluding investments formed from capital contributions through asset purchases, receptions, debt conversions into equity contributions at restructured enterprises).

- Exchange rate differences;

- Discount payments;

- Provisions for long-term investment write-downs established according to this regulation;

- Interest expenses on borrowed funds as prescribed;

- Expenses related to government bond buying and selling activities;

- Other financial expenses.

4. Other costs:

a) Fixed asset sale and liquidation costs.

b) Costs for recovering written-off debts: The Company may incur costs for legal entities and individuals who have contributed to the recovery of written-off debts based on their efforts and effectiveness. The procedures, formalities, and legal responsibilities when implementing this expenditure follow the brokerage commission expenditure provisions at Point 2.5 Clause 2 of this Article.

c) Losses remaining after compensation from current sources as prescribed.

d) Differences reduced between the recognized contribution value of assets and their book values.

đ) Other reasonable and legitimate expenses.

5. Taxes, fees, and land lease payments related to business operations as prescribed by law.

6. The following items shall not be included in business expenses:

- Costs for purchasing, constructing, and installing tangible and intangible fixed assets;

- Borrowing interest costs included in investment and construction expenses;

- Expenditures without valid documentation;

- Expenditures covered by other sources;

- Penalties for legal violations caused by individuals rather than the company.

Article 22. Profit of the Company

The profit realized in the year is the business result of the Company, including operating profit, financial investment profit, and other activity profits.

Article 23. Distribution of Profits

DATC implements profit distribution and establishes funds according to current regulations for enterprises in which the State holds 100% of the charter capital.

Section V. SUPERVISION AND ASSESSMENT OF BUSINESS EFFECTIVENESS

Article 24. Supervision of Activities

The Company implements internal supervision mechanisms in accordance with regulations applicable to single-member limited liability companies where the State is the sole owner, and is subject to inspection and supervision by the owner and competent authorities regarding the results of its operations as prescribed.

Article 25. Assessment of Business Effectiveness and Classification of Enterprises

Annually, the Board of Members of the Company assesses business effectiveness and reports to the Ministry of Finance for consideration and publication of the enterprise classification results based on appropriate evaluation criteria consistent with the specific activities of the Company under regulations applicable to enterprises in which the State holds 100% of the charter capital.

Section VI. FINANCIAL PLANNING, ACCOUNTING WORK, AND AUDITING

Article 26. Accounting System

The Company organizes accounting records in accordance with the accounting system issued by the competent authority applicable specifically to DATC, consistent with Vietnamese accounting standards, Vietnamese accounting systems, and the provisions of this Regulation.

Article 27. Financial Plan

1. Based on strategic orientation and business development planning approved by the owner, the Company builds long-term business plans and financial plans that align with the strategic direction plan of the Company already approved by the owner.

2. Annually, based on the long-term business plan and the capacity of the company and market demand, the Board of Members decides on the next year's business plan.

3. Based on the business plan decided by the Board of Members, the Company evaluates the business situation of the year reported and prepares the next year's financial plan to be submitted to the Ministry of Finance before July 31 each year.

Article 28. Financial Reports, Statistics, and Other Reports

1. At the end of the accounting period (quarter, year), the Company must prepare, present, and submit financial reports and statistical reports to state agencies and implement financial transparency according to current laws. The Board of Members of the Company is responsible for the accuracy and truthfulness of financial and statistical reports and the implementation of financial transparency.

2. In addition to periodic financial and statistical reports prepared and submitted as stipulated above, the Company must also prepare and submit ad hoc reports when requested by the Ministry of Finance and other state management agencies; in cases where the Company has domestic loans and foreign loans guaranteed by the Government, the Company must prepare and submit reports in accordance with current laws governing the management of government-guaranteed debt.

Article 29. Audit System

- The annual financial report of the Company must be audited by an independent auditing firm in accordance with regulations.

- The Company implements an internal audit system in accordance with the law.

Article 30. In addition to implementing the provisions of this regulation, the Company must also comply with other guidelines from the Ministry of Finance regarding the procedures and formalities for handling finances related to debt buying and selling activities, and the acceptance and processing of assets of enterprises during the process of state-owned enterprise ownership conversion.

Chapter III.

IMPLEMENTING PROVISIONS

Article 31. Effective Date

This Regulation takes effect from November 1, 2016, and applies from the fiscal year 2016 onwards. This Regulation replaces the Financial Regulation issued together with Decision No. 2857/QĐ-BTC dated November 9, 2012, of the Ministry of Finance.

Article 32. Relevant provisions

In case the legal normative documents referred to in this Circular are amended, supplemented, or replaced, they shall be implemented according to such legal normative documents./.