Pursuant to …;

Regarding the issuance of the accounting system for state budget and financial affairs of communes

_______________________

 

THE MINISTER OF FINANCE

Pursuant to the State Budget Law dated March 20, 1996 and the Law Amending and Supplementing Certain Provisions of the State Budget Law dated May 20, 1998;

Pursuant to the Accounting and Statistics Decree dated May 20, 1988;

Pursuant to Decree No. 15/CP dated March 2, 1993 of the Government on the tasks, powers, and responsibilities for state management of ministries and ministerial-level agencies;

BASED ON DECREE NO. 178/CP DATED OCTOBER 28, 1994 OF THE GOVERNMENT ON THE TASKS, POWERS AND ORGANIZATIONAL STRUCTURE OF THE MINISTRY OF FINANCE;

Pursuant to Decree No. 87/CP dated December 19, 1996 of the Government detailing the division of management authority, preparation, implementation, and settlement of the state budget, and Decree No. 51/1998/NĐ-CP dated July 18, 1998 of the Government amending and supplementing certain provisions of Decree No. 87/CP dated December 19, 1996 of the Government;

Pursuant to the Accounting System for Administrative and Public Services issued pursuant to Decision No. 999-TC/QĐ/CĐKT dated November 2, 1996 of the Ministry of Finance;

To guide commune accounting work in accordance with the characteristics of commune state budget activities and other financial activities of communes, wards, and towns, and to bring commune state budget - finance - accounting management into a regular system;

Following Circular No. 118/2000/TT-BTC dated December 22, 2000 of the Ministry of Finance regarding management of commune state budgets and other financial activities in communes, wards, and towns;

At the proposal of the Director of the Accounting System Department and the Director of the State Budget Department,

Pursuant to …;:

Article 1- Issued together with this Decision is the "Accounting System for Commune State Budget and Financial Affairs" including:

1- General Provisions;

2. Accounting vouchers system;

3. Accounting account system;

4. Accounting ledger system;

5- Financial Reporting System and Settlement Reports.

Article 2- The Accounting System for Commune State Budget and Financial Affairs shall apply to communes, wards, and towns (collectively referred to as communes) under districts, counties, and provincial cities throughout the country.

Article 3- The Accounting System for Commune State Budget and Financial Affairs shall take effect from January 1, 2002 and replace the Commune State Budget Accounting System issued together with Decision No. 827/1998/QĐ-BTC dated July 4, 1998 and Decision No. 39/2001/QĐ-BTC dated May 2, 2001 of the Ministry of Finance amending and supplementing the Commune State Budget Accounting System issued pursuant to Decision No. 827/1998/QĐ/BTC dated July 4, 1998.

Article 4- For communes with small state budget revenues and expenditures and limited capacity of accounting staff, the Ministry of Finance authorizes the Director of the Provincial Department of Finance and Prices to examine and permit the use of the "single-entry accounting method" or select appropriate accounts.

Article 5- The Directors of the Provincial Departments of Finance and Prices shall be responsible for implementing, guiding, and supervising the application of this accounting system in communes, wards, and towns.

Article 6- The Chairpersons of Commune People's Committees must strictly comply with the provisions of this accounting system.

Article 7- The Directors of the Accounting System Department, the State Budget Department, the Central Treasury General Director, the Director-General of the Tax General Department, and the Head of the Ministry of Finance’s Office shall be responsible for guiding, inspecting, and enforcing this decision.

 

Part One -

GENERAL PROVISIONS

Chapter 1:

GENERAL PROVISIONS

Article 1: Commune state budget and financial accounting involves collecting, processing, recording, and providing information on all economic and financial activities of the commune, including: Commune state budget revenue and expenditure activities and other financial activities of the commune. Communes, wards, and towns (collectively referred to as communes) must organize accounting work in accordance with the Accounting and Statistics Ordinance and this accounting system.

Article 2: NTasks of commune state budget and financial accounting:

1- Collecting and recording all items of state budget revenue and expenditure, communal public funds, contributions from residents, assets managed and utilized by the commune, and other financial activities of the commune;

2- Checking the implementation of the budget revenue and expenditure plan, compliance with standards and norms, management and utilization of communal public funds, contributions from residents, and expenditure of subordinate units and other financial activities of the commune;

3- Preparing financial reports and final settlement reports of the commune state budget to submit to the Commune People's Council for approval, serving financial transparency before the people according to the law, and sending to the District, County, or Town Finance Office (collectively referred to as the County) for consolidation into the state budget.

Article 3: Commune state budget and financial accounting must implement the "double-entry accounting method." The "double-entry accounting method" uses accounting accounts to record each economic and financial activity to ensure balance between revenue and expenditure, between allocated funds and their usage, and between capital and sources of capital at all times. Communes with small state budget revenues and expenditures and limited accounting capacity may implement the "single-entry accounting method" as decided by the Director of the Provincial Department of Finance and Prices. The "single-entry accounting method" does not use accounting accounts but only detailed accounting books to record specific accounting objects such as: state budget revenue and expenditure, fund receipts and payments, receivables, and payables.

Article 4: Requirements for commune state budget and financial accounting:

1- Fully, promptly, accurately, and truthfully reflecting all items of state budget revenue and expenditure, other financial activity revenue and expenditure, and communal public fund revenue and expenditure, and resident contributions;

2- Indicators collected and reflected by accounting must be consistent with indicators in the state budget estimate in terms of content and calculation methods;

3- State budget revenue and expenditure accounting must reflect according to the State Budget Classification;

4- Data in financial reports and final settlement reports of the commune state budget must be clear, understandable, and provide necessary information for the People's Committee and the People's Council of the commune;

5- Accounting records must be made with good ink that does not fade. Numbers and letters must be clear, continuous, and systematic. Abbreviations, interlineations, overlapping entries, and skipping lines are not allowed. If there are unused lines, they must be crossed out.

Article 5: Writing characters, numerals, and units of measurement

1- Accounting must use Vietnamese as writing characters and record using Arabic numerals: 0, 1, 2, 3, 4, 5, 6, 7, 8, 9.

2- Accounting values must use Vietnamese Dong (VND) as the unit of measurement and record in ledgers. In cases involving foreign currency, it must be recorded in the original currency and converted to Vietnamese Dong based on the actual exchange rate or the exchange rate prescribed by the competent authority.

3\. Physical inventory accounting must use the officially recognized units of measurement of the Socialist Republic of Vietnam. In necessary cases, supplementary units of measurement may be used for verification, comparison, or detailed accounting purposes, but they must be converted to the officially recognized units of measurement of Vietnam.

Article 6: The fiscal year for accounting purposes runs from January 1st to December 31st. The monthly accounting period runs from the 1st to the last day of each month. The quarterly accounting period runs from the 1st day of the first month of the quarter to the last day of the last month of the quarter.

Article 7: The contents of budget and financial accounting for communes include:

- Cash and bank fund accounting: Reflecting the current amount and changes in the entire commune budget fund held in cash at the Treasury and in the commune's own funds;

- Budget revenue accounting: Reflecting all budget revenues of the commune as prescribed by law into the state budget at the Treasury and the refunding of budget revenues to eligible recipients;

- Budget expenditure accounting: Reflecting regular expenditures and basic construction investment expenditures according to the approved budget estimates into the commune budget at the Treasury and the settlement of budget expenditures according to the budget schedule;

- Special-purpose public fund accounting: Reflecting the current amount and changes in special-purpose public funds and other financial activities managed by the commune, including cash on hand, deposits at the Treasury, etc.;

- Settlement accounting:

+ Reflecting receivables and the settlement of receivables from various entities;

+ Reflecting payable debts of the commune for services used but not yet settled with suppliers, contractors, and other debts of the commune;

- Inventory, assets, and sources of funds forming fixed assets accounting: Reflecting the current amount and changes in assets and sources of funds forming fixed assets of the commune due to completion of purchases, basic construction, transfers, state investments, contributions, donations, and changes in assets and sources forming fixed assets of the commune;

- Preparing financial statements and final accounts reports to submit to the People's Council of the commune and send to the County Finance Department;

Article 8: Inventorying assets

Communes must conduct periodic and extraordinary inventories to determine the actual amounts of inventory, assets, fund balances, and receivables and payables at the time of the inventory.

Periodic inventory: At the end of the fiscal year before closing the books, the commune must conduct an inventory of inventory, assets, fund balances, reconcile and confirm the amounts deposited at the Treasury, and current receivables and payables to ensure that the figures in the accounting records match reality. If there is a discrepancy between the inventory results and the accounting records, it must be resolved; if there is a shortage of inventory, assets, fund balances, etc., responsibility must be assigned to handle it. Based on the resolution of the inventory discrepancy, the accountant will adjust the accounting records to ensure that the accounting figures match the actual figures.

Extraordinary inventory: The commune must conduct an extraordinary inventory in cases of natural disasters, fires, transfers, mergers, divisions of communes, and other unusual incidents.

Article 9: Financial and accounting inspection

Communes must comply with the guidance and financial and accounting inspections by relevant state agencies, directly the County Finance Department, and be subject to supervision by the People's Council of the commune regarding compliance with the State Budget Law, financial policies, and accounting systems of the state, and resolutions of the People's Council of the commune concerning budget areas and other financial activities in the commune.

Financial and accounting inspections must be conducted regularly, continuously, systematically, and comprehensively throughout the fiscal year and during each accounting period.

The content of financial and accounting inspections includes checking entries on accounting vouchers, ledgers, financial statements, and final accounts reports on budget revenues and expenditures. Checking compliance with financial regulations and accounting procedures and implementation of financial standards, quotas, and discipline during budget execution.

The County People's Committee (directly the County Finance Department) must inspect the financial and accounting of communes once a year. The commune chairman, chief accountant, or person responsible for accounting must comply with the orders of financial and accounting inspections by state agencies and have the responsibility to provide all necessary data and documents for the financial and accounting inspection work. Upon completion of the inspection, an inspection report signed by the inspection team, the chief accountant or person responsible for accounting, and the Chairman of the People's Committee of the commune must be prepared, one copy sent to the commune's People's Committee, and one copy sent to the Chairman of the County People's Committee.

Article 10: Preservation and storage of accounting documents

Accounting documents include accounting vouchers, ledgers, financial statements, final accounts reports, and other related documents.

After the end of the fiscal year and completion of all adjustments and final settlements of the annual budget, accounting documents must be organized, classified, bound, listed, packaged, and cataloged for storage in the accounting department for one year, then transferred to archives.

The retention periods for accounting documents are as follows:

- A minimum of five years for accounting documents used for regular management and operation that are not directly used for recording in ledgers and preparing financial statements;

- Retain for twenty years for accounting documents directly related to ledger entries, preparation of financial statements, and final accounts reports;

- Retain over twenty years for accounting documents with archival value and significant economic, political, and social importance to the commune.

Article 11: Communes must base their scale of operations to assign full-time accountants, appoint chief accountants, or designate persons responsible for accounting. Communes that have appointed chief accountants shall retain the title of chief accountant, while those that do not meet the conditions for appointing chief accountants shall designate persons responsible for accounting.

Accounting staff must have professional qualifications in financial and accounting practices, trained appropriately and in accordance with the specified positions and standards, and guaranteed independence in professional practice according to state regulations and this accounting system.

Accounting officers shall not concurrently hold positions as warehouse managers, cashiers, or other material management tasks.

The Chairman of the People's Committee, the Chief Accountant or the person in charge of accounting, and the Head of the Financial Board of the commune shall not appoint family members (Father, Mother, Wife, Husband, Son, Sister, Brother) to work in financial, accounting, warehouse, and cashier roles at the People's Committee Office and subordinate units within the commune. Absolutely no family members shall be assigned to participate together in economic activities within the commune in relationships involving the executor, controller, and approver on the same accounting voucher.

Article 12: The Chief Accountant or the person in charge of accounting has the function of assisting the Head of the Financial Board of the commune in managing the commune's budget revenue and expenditure activities and other financial activities, assisting the Commune Chairman in organizing accounting, statistical, and economic information work, implementing checks and controls over compliance with state financial and accounting policies and resolutions of the Commune People's Council regarding finance and budget.

The appointment, dismissal, transfer, and disciplinary action of the Chief Accountant or the person in charge of accounting shall be decided by the Chairman of the District People's Committee based on the proposal of the Chairman of the Commune People's Committee and the written opinion of the Head of the District Finance Department.

Article 13: The person appointed to the position of Chief Accountant or entrusted with the responsibility of accounting must meet the following criteria, duties, and powers:

1- Criteria:

a- Possessing honest moral qualities, being truthful, having a sense of compliance with economic, financial policies, and state laws;

b- Having professional expertise in financial and accounting operations (graduation certificates in finance and accounting from secondary level or higher. For mountainous communes in remote areas, a basic certificate in finance-accounting is required), capable of organizing and directing accounting operations at the unit.

Absolutely no appointment of Chief Accountant or entrusting with the responsibility of accounting shall be made for individuals who have violated embezzlement discipline, infringed upon public property, and violated state financial and accounting policies, previously disciplined at the warning level or higher.

2- Duties:

a- Organizing the implementation of accounting work suitable to the conditions of operation, requirements, and management level of the commune;

b- Checking the preparation of budgets and the execution of budget revenues and expenditures, compliance with national standards and norms at the commune. Implementing inspections and controls over the financial revenues and expenditures of subordinate commune units;

c- Implementing the preservation and storage of accounting documents and the use of stored accounting documents according to regulations;

d- Implementing guidance on state financial and accounting policies, systems, and rules in the commune. Analyzing and evaluating the situation of commune budget revenues and expenditures.

3- Powers:

a- The right to request relevant departments and individuals in the commune to provide complete and timely accounting vouchers, documents, and data related to accounting work;

b- The right to sign and approve accounting vouchers, financial reports, and final settlement reports of the commune budget and contracts concerning the purchase, sale of assets, materials, tendering for repair and construction, and contracting between the commune and other units and individuals inside and outside the commune. All vouchers for receipt and payment of money, asset transfers, and transfers must have the signature of the account holder and the signature of the Chief Accountant or the person in charge of accounting;

c- The right to report to the Chairman of the Commune People's Council and state functional agencies about violations of the State Budget Law and financial and accounting systems in the commune;

d- The right to refuse to sign or approve vouchers and other documents if they are deemed inappropriate or violate current financial and accounting regulations;

In cases where the account holder requests or orders orally or in writing to perform actions prohibited by law (such as forging, altering accounting vouchers and books, destroying vouchers, or misrepresenting the nature and content of economic transactions to embezzle state, collective, and people's assets), the Chief Accountant or the person in charge of accounting has the right to refuse to execute such orders and report to the Chairman of the Commune People's Council or state functional agencies. If the Chief Accountant or the person in charge of accounting performs prohibited economic transactions under the order of the person giving the order, they will bear the same responsibility as the person giving the order.

Article 14: All organizations, associations, and individuals related to commune financial and accounting work must strictly comply with accounting principles, systems, and procedures; they are responsible for providing complete and timely necessary vouchers and documents for accounting work and are responsible for the accuracy, truthfulness, legality, and validity of these vouchers and documents.

Chapter 2:

ACCOUNTING VOUCHERS

Article 15: All economic and financial transactions related to the budget and commune financial activities must be recorded in accounting vouchers. All entries in accounting books must be supported by valid and legitimate accounting vouchers.

- Legitimate accounting vouchers: These are vouchers prepared according to the prescribed format. Entries on the vouchers must accurately reflect the content and essence of the economic transaction and comply with legal provisions; They must have the signatures of the preparer, approver, and executor, and the commune seal as specified for each type of voucher.

- Valid accounting vouchers: These are vouchers that fully record all elements and formats as prescribed and are prepared according to the prescribed method and sequence for each type of voucher. In cases without a model, handwritten vouchers containing all required elements are also considered valid.

Accounting vouchers must be prepared with all copies and only once, accurately reflecting the actual time and place of the economic transaction according to the prescribed format. In cases of damaged, missing, or incorrect vouchers, they must be invalidated by drawing an "X" across all copies and the copies must not be separated from the stub.

Article 16: Accounting vouchers must contain the following elements:

- Name and number of the voucher;

- Date of issuance of the voucher;

- Name of the unit or individual issuing the voucher;

- Name of the unit or individual receiving the voucher;

- Content of the economic and financial transaction.

- Indicators regarding quantity, unit price, and total amount of economic and financial transactions (e.g., name, trademark, specifications, quality, quantity, unit price, total amount for each type of material, total amount in figures and in words);

- Full name and signature of the person responsible for preparing the document and the person responsible for approving the document. For documents prepared by the commune and sent externally, they must bear the commune's seal.

For petty purchases and expenditures where the seller does not issue an invoice, the buyer must prepare a "Purchase Invoice Form." The "Purchase Invoice Form" must clearly state the buyer's full name and address; the name, quantity, and actual payment amount for goods and services purchased. The "Purchase Invoice Form" must be reviewed and confirmed by the accountant, submitted to the account holder for approval, and only then will it be considered a valid and legal document and serve as the basis for accounting records.

Article 17: Procedure for preparing and processing accounting vouchers:

All accounting vouchers prepared by the commune or received from external sources must be centralized in the commune's accounting department. The accounting department must review these vouchers and only use them for recording in the accounting books after verifying that they are correct.

The procedure for preparing and processing accounting vouchers includes the following steps:

- Preparing accounting vouchers;

- Collecting accounting vouchers;

- Reviewing, classifying, determining accounts for economic and financial transactions, and organizing accounting vouchers;

- Recording in the accounting books based on accounting vouchers;

- Store and preserve accounting documents.

Article 18: Strictly prohibit the following acts:

- Collecting taxes, fees, and contributions from residents without issuing tickets, stamps, or receipts;

- Expenditure, income, or transfer of assets without legal and valid vouchers;

- Forgery of accounting vouchers to embezzle public funds or money;

- Legalizing accounting vouchers;

- The account holder and chief accountant signing their names in advance on blank vouchers;

- Distorting or intentionally misrepresenting the content and nature of economic and financial transactions;

- Altering, erasing, or overwriting on accounting vouchers;

- Destroying vouchers before the retention period has expired as prescribed;

- Using invalid voucher formats.

Article 19: Regulations on the use, management, and printing of accounting voucher formats:

All communes must comply with the regulations on accounting vouchers and voucher formats stipulated in this accounting system. During implementation, provinces, districts, and communes may not arbitrarily modify the prescribed forms.

Printed accounting voucher formats must be carefully preserved and not lost, damaged, deteriorated, or misused.

Printing and distributing accounting voucher formats:

- When printing accounting voucher formats for budget and financial accounts, units must design and print according to the prescribed content of the voucher formats;

- Accounting voucher formats related to budget revenue collection or receipt forms for collecting money are managed and issued uniformly by the Ministry of Finance, except for receipt forms and various types of tickets for managing revenues at the commune level, which are organized for printing and distribution by the provincial Department of Finance and Price Control upon authorization by the Ministry of Finance.

Article 20: The system of accounting voucher formats applicable to commune budget and financial accounting includes the following types:

1- Vouchers issued under this accounting system, comprising 10 formats;

2- Vouchers issued under the Accounting System for State Budgetary Units (Decision No. 999 - TC/QĐ/CĐKT dated November 2, 1996 of the Minister of Finance), applicable to commune budget and financial accounting, comprising 16 formats divided into four indicators:

- Labor wage indicator;

- Material indicator;

- Currency indicator;

- Fixed asset indicator.

3- Vouchers issued under the Treasury Accounting System and other documents, comprising 12 formats.

The list of vouchers and instructions for preparing accounting vouchers applicable to commune budget and financial accounting are specified in Part Two - Accounting Voucher System.

Chapter 3:

ACCOUNTING ACCOUNT SYSTEM

Article 21: Communes base their first and second-level account directories on the accounting account system prescribed in this regulation, adapting them to the commune's characteristics and management requirements. Communes may open third-level accounts (four-digit accounts). If additional first or second-level accounts are opened, written opinions must be submitted to the provincial Department of Finance and Price Control for consolidation and submission to the Ministry of Finance for approval.

Article 22: The accounting account system for commune budgets and finances comprises 15 accounts in the Balance Sheet, including 11 mandatory accounts for all communes and 4 recommended accounts for communes with significant fixed assets and relatively advanced management levels: Account 152 "Materials," Account 211 "Fixed Assets," Account 214 "Depreciation of Fixed Assets," and Account 466 "Sources of Funds Formed into Fixed Assets."

The directory, explanation of the structure, and method of recording accounts are detailed in Part Three - Accounting Account System.

Chapter 4:

LEDGER AND ACCOUNTING FORMS

Article 23: Communes must open ledgers according to prescribed formats to record economic transactions and retain all accounting data for preparing financial reports.

The ledger system applies to all communes. Communes implement the "single-entry" method without opening a "Journal-General Ledger."

Communes requiring more detailed management may open up to eight additional ledgers.

In cases where communes conduct accounting using computers, they must follow the accounting software program issued by the Ministry of Finance.

Article 24: The accounting form applied to communes implementing the "double-entry" method is the Journal-General Ledger system, consisting of two types of ledgers:

a/ Journal-General Ledger: This is a comprehensive accounting ledger, the Journal part is used to record economic transactions in chronological order; the General Ledger part is used to record and organize economic transactions by content (accounting accounts).

- Data in the Journal-General Ledger reflects the overall situation of budget revenue and expenditure; fund revenue and expenditure, current funds, changes in cash, materials, assets, receivables and payables, and other activities.

- The Journal-General Ledger must include the following elements:

+ Date of entry;

+ Voucher number, date, and month used as the basis for entry;

+ Content of economic and financial transactions;

+ Debit account number and credit account number of the economic and financial transaction;

+ Names of accounting accounts, each account having two columns for debit and credit. The number of columns in the Journal-General Ledger depends on the number of accounts applied by the commune;

+ Amount recorded on the debit side and amount recorded on the credit side for each account.

b- Detailed Accounting Book: This is a book used to reflect in detail each economic transaction that occurs according to specific accounting objects which have not been reflected in the Journal-General Ledger. The data in the detailed accounting book is used to record budget revenues and expenditures according to the Budget Item List, based on economic content, and other accounting objects that need to be monitored in detail as required for management purposes. The data in the detailed accounting book provides information necessary for management and financial statement preparation, final settlement reports, village funds, and systematization of various types of assets, money, funds, accounts receivable and payable, and other activities managed by the village.

- The detailed accounting book includes the following elements:

+ Name of the book;

+ First-level account, second-level account;

+ Date of entry;

+ Date number of the voucher;

+ Content of the economic transaction;

+ Other indicators: Based on management requirements, each type of book has quantity, unit price, total amount, revenue and expenditure items according to the Budget Item List, debit occurrence amount, credit occurrence amount, end-of-period balance, etc.

Article 25: Accounting books must use pre-printed or pre-lined forms and bound into volumes. Opening and recording in accounting books must ensure comprehensive, truthful, accurate, timely, continuous, and systematic reflection of budget revenue and expenditure situations, special-purpose fund revenue and expenditure, asset management and utilization, money, funds, accounts receivable and payable, and people's contributions, providing necessary information for budget management by the Village Chairman and public financial disclosure as prescribed by law. It is strictly prohibited to leave out any revenue, expenditure, type of asset, money, fund, accounts receivable and payable, or people's contribution outside the accounting books.

Article 26: Opening Accounting Books

At the end of the accounting period, determine the difference between the sales volume of foreign exchange sold ( Before using accounting books, the following procedures must be carried out:

On the cover and first page of the book (left corner), the name of the village, district, province, budget level must be clearly recorded; in the middle of the cover, the name of the book, date of opening the book, budget year, and the name of the person recording the book, the date of completion of recording or transfer to another person, and confirmation by the Village Chairman must be recorded.

Each page of the book must be numbered, and between two pages of the book, the village seal must be stamped.

The Village Chairman, Chief Accountant, or accounting supervisor must sign and confirm on the first page of the accounting book.

- In case of using loose-leaf General Ledger: After use, the pages (cards) must be arranged in chronological order and preserved. At the end of the accounting year, the accountant must bind them into volumes and complete all legal procedures as with bound books.

- In case of recording accounting books on a computer:

Village budget and finance accountants may record manually or on a computer. If recording on a computer, the accounting books designed on the computer must fully display the indicators specified for each form. Specifically, the General Ledger uses a ledger with fewer columns (each account uses one page or several pages of the ledger) instead of the Journal-General Ledger. At the end of the accounting period, after completing the closing process according to regulations for each type of book, a full printout of the consolidated accounting books and detailed accounting books must be made. Then, all legal procedures must be completed as with handwritten accounting books.

Accounting books are only considered legal and valid after completing all the above procedures.

b- Opening Accounting Books at the Beginning of the Year:

At the beginning of the year, accounting books for the new budget year (including the Journal-General Ledger and detailed accounting books) must be opened to receive the balances from the previous year's books and immediately record new economic transactions and budget transactions occurring from January 1st.

+ Journal-General Ledger: At the beginning of the year, the entire balance of accounts on the previous year's Journal-General Ledger must be transferred to the new year's Journal-General Ledger. This balance includes the balance of Accounts 714, 814 (these are cumulative budget revenue and expenditure balances from the start of the year to December 31 of the previous budget year).

+ Detailed Accounting Books:

"Fixed Asset Book" this book is used for multiple years, and when it is full (all depreciation columns are filled), a new book must be started;

"Village Budget Revenue Book", "Village Budget Expenditure Book", "Village Budget Revenue and Expenditure Consolidation Book according to Reporting and Settlement Indicators": Data in these three books does not need to be transferred to a new book but remains in the old book to continue recording new economic transactions during the adjustment, settlement, and monitoring periods until the annual settlement is approved.

Article 27: Procedure and Method of Recording Accounting Books under the Journal-General Ledger System.

a- Recording the Journal-General Ledger:

- Daily Recording:

Every day, upon receiving accounting vouchers, the accountant must check their legal nature, determine the debit and credit accounts, and record them in the Journal-General Ledger. Each accounting voucher is recorded in one line in both the Journal and the General Ledger sections of the Journal-General Ledger.

For similar accounting vouchers with the same content occurring multiple times in one day (such as receipt vouchers, payment vouchers, material issuance vouchers, material receipt vouchers...), they can be classified and summarized into a Summary Table of Similar Accounting Vouchers according to each content. Then, based on the total amount in each Summary Table of Similar Accounting Vouchers, record one line in the Journal-General Ledger.

- Summarizing, Checking, and Reconciling End-of-Month Data:

+ At the end of the month, after reflecting all accounting vouchers generated in the month in the Journal-General Ledger and detailed accounting books, the accountant proceeds to close the books, summing up the total amounts in the occurrence column of the Journal section, summing up the debit occurrences and credit occurrences, and calculating the end-of-month balance of each account in the General Ledger section;

+ Then, check and reconcile the monthly occurrence totals in the Journal-General Ledger by adding up the total debit occurrences and total credit occurrences of all accounts reflected in the General Ledger section and comparing them with the total amount in the occurrence column of the Journal section. Based on the end-of-period balance of each account in the Journal-General Ledger, sum up all debit balances and all credit balances of the accounts, compare the total debit balance with the total credit balance of all accounts. When checking and reconciling the occurrence data, the following balancing principle must be ensured:

 

b- Record detailed accounting books (cards):

- Accounting vouchers, summary accounting records after recording in the Journal-General Ledger must be recorded in detailed accounting books (cards);

- Daily, based on accounting vouchers, record into relevant detailed accounting books (cards) in appropriate columns;

- At the end of the month or quarter, summarize data and lock detailed accounting books (cards). The opening balance, debit entries, credit entries, and closing balances for each account must be calculated. Then, based on the data from the detailed accounting books, prepare a "Detailed Summary Table" for each account;

- Data on the Detailed Summary Table must be verified and reconciled with the debit entries, credit entries, and closing balances of each account in the Journal-General Ledger and other detailed accounting books (cards).

Article 28: Correct errors in accounting books using one of the following three methods:

- Correction method (also called the cancellation method);

- Negative entry method (also called the red ink method);

- Supplementary entry method.

1- When using the correction method to correct errors in accounting books, draw a red line through the incorrect entry but ensure that the original content remains legible. Write the correct figures or characters in regular ink above the crossed-out entry. If the error involves only a single digit, the entire incorrect number must be erased and rewritten correctly. The correction must be authenticated by the signature of the Chief Accountant next to it.

This method applies to the following cases:

- Errors in narration that do not affect the relationship between accounts;

- Errors that do not impact the total amount.

2- When using the negative entry method to correct errors, first write the erroneous entry in red ink to cancel it, then write the correct entry in regular ink.

This method applies to the following cases:

- Errors in the relationship between accounts due to incorrect journalizing that cannot be corrected using the correction method;

- Errors discovered after financial statements and final accounts have been approved and submitted;

- Errors in amounts recorded incorrectly or where the recorded amount is greater than the actual amount.

When using the negative entry method to correct errors, a "Correction Voucher" signed by the Chief Accountant must be prepared.

3- The supplementary entry method is applied when the journal entry correctly reflects the relationship between accounts but the recorded amount is less than the actual transaction amount or when the amount is omitted from the accounting records. A "Supplementary Recording Voucher" signed by the Chief Accountant must be prepared to confirm the additional amount to be recorded.

Article 29: In computerized accounting bookkeeping, errors can be corrected according to one of the three methods mentioned above, provided that the following rules are followed:

+ If the error is detected before printing the books, it may be corrected directly on the computer;

+ If the error is detected after printing the books, it must be corrected on both the printed books and the computer records according to one of the three specified methods, and a new page must be printed. The new page and the page containing the error must be kept together for easy verification and control.

Article 30: When the previous year's final accounts have been approved or when the audit, inspection, and auditing of the previous year's financial statements have concluded with comments, if there is a need to correct the figures in the previous year's financial statements, the entity must correct the errors in this year's accounting books at the time of discovery, and note the corrections at the end of the pages of last year's accounting books for easy comparison and verification.

Article 31: Locking accounting books

1- Locking accounting books involves summing up to determine the total debit entries, credit entries, and closing balances for each accounting account or total receipts, expenditures, cash balances, etc. At the end of the accounting period (month) and the annual accounting period, after reflecting all economic and financial transactions occurring during the period in the accounting books, the accounting books must be locked. Specifically, the cash book must be locked at the end of each day. Additionally, locking must occur in cases of unexpected inventory checks due to natural disasters, fires, or mergers, divisions of communes.

2- Procedure for locking accounting books at the end of the month:

- After all accounting vouchers generated in the month have been recorded in the accounting books, perform a summation and reconcile the data among related books to ensure consistency between voucher data and recorded data, and among books;

- Sum the entries in the Journal-General Ledger (or General Ledger) and detailed accounting books;

- From detailed accounting books (cards), prepare a detailed summary table for accounts that span multiple books or pages;

- Sum all debit entries and credit entries of accounts in the Journal-General Ledger (or General Ledger) to check if they match and equal the total entries in the Journal. Then, reconcile the data in the General Ledger with the detailed accounting books or detailed summary tables, and among detailed books. If consistency is confirmed, proceed with formal locking by the following steps:

+ Draw a horizontal line under the last transaction entry of the accounting period, half a line below the last transaction number. Then, record the monthly total entries below the drawn line;

+ Record the cumulative monthly total entries from the beginning of the year to the end of the month below the monthly total entries line;

+ Record the calculated closing balance for the month below the monthly total entries line;

The closing balance for the month is calculated as follows:

 

For accounts without economic transactions in the month, the beginning balance becomes the ending balance and is recorded in the ending balance line of that account.

( ).

For certain detailed accounting books structured with debit entries, credit entries, and balance (or receipts, expenditures, cash balances) columns, the balance column data is not recorded in the total line but in the "ending balance" line below the monthly total line.

For certain detailed ledgers with a structure consisting of columns for Debit occurrences, Credit occurrences, and Balance (or income, expenses, cash on hand), the data in the Balance column shall not be recorded in the addition row but shall be recorded in the "month-end balance" row below the last addition row of the month.

After closing the accounting books, the Chief Accountant or the person responsible for accounting must sign below two lines, then the account holder shall check and approve to certify that the closing figures are accurate and consistent with actual figures, ensuring consistency of accounting closing figures between the Chief Accountant and the account holder.

At the beginning of the following month, record the end-of-month balance of each account in the Journal-General Ledger and detailed accounting books. Notably, the balance on the revenue budget book and expenditure budget book represents the cumulative occurrence of budget revenues and expenditures, thus there is no need to record the balance at the beginning of the next month.

3- Closing the accounting books at year-end:

a- Before closing the year-end books, the following tasks must be performed:

- Urging timely collection and submission of remaining budget revenues due by the end of the year and processing the immediate deposit of collected budget revenues still held at the commune into the state budget at the Treasury. Simultaneously, settle final payments related to budget expenditures to ensure all budget revenues and expenditures occurring during the year are accounted from January 1st to December 31st.

- Urging timely payment of overdue receivables (advance payments, receivables from allocations) to return funds to the treasury. Simultaneously, pay off outstanding debts (living expenses and allowances for commune officials, social insurance contributions payable to the social insurance agency, debts to suppliers, service providers, and construction contractors).

- Processing remaining provisional budget revenues still outstanding at year-end: In principle, all provisional budget revenues must be settled within the year to be transferred to budget revenues or refunded to the provisional recipients. If provisional budget revenues in kind have not been processed for deposit into the state budget at the Treasury by year-end, they may be carried over to the next year for processing.

- For retained amounts, based on the decision of the competent authority, the People's Committee of the commune must process refunds to the retainees or process deposits into the state budget at the Treasury (if the authority decides to confiscate for public funds).

- Conduct a comprehensive inventory, reconciliation, and verification of all assets, materials, accounts receivable and payable, cash, bank balances, and various types of sources and funds of the commune to determine the actual amount of assets, funds, and accounts receivable and payable as of the end of December 31st. Based on the decision of the Inventory Committee, the accountant prepares vouchers reflecting the processing and adjusting entries on the accounting books according to the actual inventory results.

b- Closing and transferring the year-end accounting books:

- The procedures for closing the year-end books follow those for closing the monthly books.

- The time for closing the year-end books is at the end of December 31st.

- Year-end closing is done to calculate the year-end balance of each account and each accounting entity. Specifically, accounts related to budget revenues and expenditures are handled as follows: Account 7142 "This Year" is transferred to Account 7141 "Last Year"; Account 7192 "This Year" is transferred to Account 7191 "Last Year"; Account 8142 "This Year" is transferred to Account 8141 "Last Year"; Account 8192 "This Year" is transferred to Account 8191 "Last Year" for continued recording during the adjustment and settlement period until the approval of the previous year's budget settlement.

- After closing the year-end books, the commune accountant must perform the year-end transfer.

Article 32: Adjusting and settling the year-end:

- The adjustment period for the budget settlement report is the time allocated for the commune budget to continue handling matters as permitted by the State Budget Law, such as adjusting errors found during accounting, and allowing expenditures (from the previous budget year) up to January 15th of the following year if approved.

- The adjustment period for the budget settlement is until January 31st of the following year.

- The adjustment and settlement of the budget:

+ Comprehensive accounting is conducted on the General Ledger or Journal-General Ledger of the new year;

+ Detailed accounting of budget revenues and expenditures of the commune is recorded on the Revenue and Expenditure Books of the commune and the consolidated Revenue and Expenditure Books of the commune according to the reporting and settlement indicators of the previous year.

- Determining and processing the budget surplus:

After completing the adjustment and settlement of the budget, prepare the budget revenue settlement report and the budget expenditure settlement report to submit to the District/County Finance Department and present to the Commune People's Council. Based on the approval of the People's Council regarding the total budget revenue and total budget expenditure of the commune, determine the budget surplus. The commune budget surplus is the difference where total budget revenue exceeds total budget expenditure. After determining the previous year's budget surplus, the People's Committee of the commune prepares a document requesting the County Treasury to process the deposit of the previous year's budget surplus into this year's budget. Based on the documents processed by the Treasury regarding the previous year's surplus, the accountant records the previous year's surplus in the current year's revenue budget book.

The format of the books and methods of recording are specified in Part Four: Accounting System.

Chapter 5:

FINANCIAL REPORTS AND SETTLEMENT REPORTS

Article 33: The system of financial reports and budget revenue and expenditure settlement reports, and special-purpose fund revenue and expenditure settlement reports of the commune serves the following purposes:

1- To compile and present a general and comprehensive overview of budget revenue and expenditure and their structure; the financial activities of the commune;

2- To provide necessary financial information for consolidating commune budget revenues and expenditures into the state budget and meeting requirements for financial inspection, control, consolidation, analysis, and evaluation of commune financial operations. Additionally, the financial report and settlement data serve the purpose of financial transparency as required by law;

3- Through the data in the financial report, it allows for evaluating the implementation of the commune budget estimate for each period and comparing the progress of the current budget period with previous periods and the previous year in terms of total amounts and specific indicators, forms of revenue or expenditure;

4- Periodic financial reports are important documents for preparing the budget plan and serve as a basis for calculating factors affecting budget revenues and expenditures.

Article 34: Number of reports and deadlines for submitting reports

1- Number of reports:

a- Monthly reports include three types of reports:

+ Account Balance Sheet;

+ Summary Report of Commune Budget Revenues;

+ Summary Report of Commune Budget Expenditures.

b- Annual reports include eight types of reports:

+ Account Balance Sheet;

+ Settlement Balance Sheet of Commune Budget;

+ Settlement Report of Commune Budget Revenues;

+ Final settlement report on village budget expenditures;

+ Consolidated final settlement report on village budget revenues;

+ Consolidated final settlement report on village budget expenditures;

+ Financial statement explanation;

+ Construction and Development Report;

The number of reports, content, calculation methods, and presentation formats for each index in these reports as stipulated in this system shall be uniformly applied to all villages, towns, and urban districts nationwide. In addition, to meet management requirements, evaluation needs, and reporting to the People's Council, each province may further detail the consolidated indices but must not disrupt the prescribed templates.

2- Deadline for submitting reports

a- Monthly reports must be submitted to the People's Committee of the village and the Finance Office of the district no later than the fifth day of the following month.

b- Annual reports must be submitted to the People's Committee of the village, the Finance Office of the district, and the People's Council no later than February 15th of the following year.

The forms, contents, and methods of preparing financial statements and final settlement reports are specified in Part Five - Financial Reporting System and Final Settlement Reports.

Article 35: Responsibilities for preparing, submitting, and approving financial statements and final settlement reports

1- The budget accounting and finance department of the village is responsible for preparing financial statements and final settlement reports according to regulations. These reports are prepared based on accounting records and must be complete, accurate, truthful, and comply with the prescribed content and timeframes.

2- Approval authority for reports:

- Monthly reports are reviewed by the Chairman of the People's Committee of the village;

- Annual reports are submitted to the People's Committee of the village for approval by the People's Council.

3- After the annual report has been approved by the People's Council, it must be sent to:

- One copy to the People's Council;

- One copy to the People's Committee of the village;

- One copy to the District Finance Office;

- One copy retained at the place of preparation.

4- The figures from the annual report, after being approved by the People's Council, will be used for publicizing the village's budget and finances.

Chapter 6:

IMPLEMENTATION

Article 36:

- The Chairmen of the People's Committees of villages, towns, and urban districts must strictly adhere to the accounting regulations in this system;

- The Director of the Department of Finance and Prices is responsible for guiding, directing, and supervising the implementation of the accounting system in villages, towns, and urban districts under provincial and municipal management.

Part Two

ACCOUNTING DOCUMENT SYSTEM

LIST OF ACCOUNTING DOCUMENTS

 

Part Three

ACCOUNTING ACCOUNT SYSTEM

LIST OF ACCOUNTING ACCOUNTS

Note:

(*) Mandatory: These accounts apply to all villages, towns, and urban districts.

(**) Guidance: These accounts apply additionally to villages with significant fixed assets and relatively high management levels.

Part Four

ACCOUNTING LEDGER SYSTEM

LIST OF ACCOUNTING LEDGERS

 

Part Five

FINANCIAL REPORTING AND SETTLEMENT REPORTING SYSTEM

LIST OF FINANCIAL REPORTS AND SETTLEMENT REPORTS