Circular No. 147/1998/TT-BTC guides the financial management regime for Vietnamese agencies abroad

CIRCULAR

GUIDELINES ON THE FINANCIAL MANAGEMENT REGIME FOR VIETNAMESE REPRESENTATIVE AGENCIES ABROAD ISSUED BY THE MINISTRY OF FINANCE DECREE NO. 147/1998/TT-BTC ON NOVEMBER 12, 1998 ON THE FINANCIAL MANAGEMENT OF VIETNAMESE REPRESENTATIVE AGENCIES ABROAD

Pursuant to the State Budget Law dated March 20, 1996, and Government Decree No. 87/CP dated December 19, 1996, detailing the delegation of management, preparation, implementation, and settlement of the state budget.
Pursuant to the Law Amending and Supplementing Certain Provisions of the State Budget Law No. 06/1998/QH10 dated May 20, 1998, and Government Decree No. 51/1998/NĐ-CP dated July 18, 1998, amending and supplementing certain provisions of Government Decree No. 87/CP dated December 19, 1996, detailing the delegation of management, preparation, implementation, and settlement of the state budget.
Pursuant to Decision No. 280-TC/QĐ-NSNN dated April 15, 1997, of the Minister of Finance on the issuance of the state budget classification system.
Pursuant to Point 10, Section 1 of Circular No. 103/1998/TT-BTC dated July 18, 1998, of the Ministry of Finance on guiding the delegation, preparation, implementation, and settlement of the state budget.
Pursuant to Decree No. 15/CP dated March 2, 1993 of the Government stipulating 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;
Considering the specific nature of the activities of Vietnamese representative agencies abroad;
The Ministry of Finance hereby issues guidelines on the financial management regime for Vietnamese representative agencies abroad as follows:

2. Individuals who have registered as the principal investigator of a Research Project or Pilot Production Project and those participating in its implementation shall not participate in the Evaluation and Selection Council for that Research Project or Pilot Production Project (hereinafter referred to as the Council). In necessary cases, members of the Council may be staff members of the organization registering as the principal investigator of the Research Project or Pilot Production Project, but not more than one person and they cannot serve as Chairperson, Vice-Chairperson, or reviewing member.

Vietnamese embassies, general consulates, Vietnam News Agency, representative offices, press, cultural institutions (hereinafter referred to as representative agencies), whose operating expenses are covered by the state budget, shall be responsible for strictly adhering to the provisions of the State Budget Law and the guiding documents of the State Budget Law regarding the preparation, implementation, and settlement of the state budget.

II. SPECIFIC PROVISIONS

1. Preparation of the annual revenue and expenditure budget of the state budget:

Each year, based on assigned political tasks, revenue collection systems, expenditure standards and norms, price fluctuations in the host country, budget estimates reviewed by competent authorities, and the execution of previous years' budgets, representative agencies shall prepare the next year's revenue and expenditure budget according to the prescribed forms and templates provided by the finance authority (annexed). The budget must fully reflect all revenue and expenditure items of the agency according to the state budget classification system, accompanied by a detailed explanatory report sent to the principal ministry before July 30 each year. The principal ministry will review and consolidate the budget estimates of the representative agencies together with its own revenue and expenditure budget estimates and submit them to relevant authorities in accordance with the State Budget Law and current regulations.

2. Implementation of the state budget revenue budget at representative agencies:

Sources of state budget revenue generated at Vietnamese representative agencies abroad include consular fees, notarization fees, rental income from state-owned property, reciprocal housing, rented rooms, guest rooms, bank interest, tax refunds, proceeds from the sale of surplus assets, compensation for training costs...

For revenues collected in foreign currency or local currency as mentioned above, representative agencies shall deposit these funds into the state budget holding fund according to the regulations of the Ministry of Finance (the management regulations of the state budget holding fund stipulated in Circular No. 11-TC/TCĐN dated April 20, 1992). Quarterly, representative agencies shall report to the Ministry of Foreign Affairs, which will aggregate these revenues and report to the Ministry of Finance.

3. Implementation of the state budget expenditure budget at representative agencies:

Based on the approved state budget expenditure budget (funds allocated by the Ministry of Finance), the principal ministry shall allocate the expenditure budget for representative agencies annually (divided into four quarters) with detailed itemization sent to the Ministry of Finance. Within one month of receiving notification, the Ministry of Finance must review and provide comments. After reaching consensus with the Ministry of Finance, the principal ministry shall allocate quarterly funds for representative agencies to ensure that the total budget estimate for each item in each month for all representative agencies aligns with the Ministry of Finance's quarterly state budget expenditure estimate notification.

3.1. Basis for allocation:

- Based on the annual expenditure budget for each representative agency (divided into four quarters) agreed upon with the principal ministry.

- The expenditure budget for each representative agency according to the state budget classification system prepared by the principal ministry.

- Reports on the balance of the state budget holding fund at representative agencies up to the date of allocation.

3.2. Method of allocation for Vietnamese representative agencies abroad is as follows:

a. Allocation of funds from the centralized foreign currency reserve of the state:

- The Ministry of Finance issues a payment order in Vietnamese dong (the amount recorded on the "payment order" in foreign currency multiplied by the accounting exchange rate specified by the Ministry of Finance).

- Based on the payment order issued by the Ministry of Finance and the approval notice of the budget estimate, the State Treasury shall withdraw foreign currency from the centralized reserve to allocate funds to Vietnamese representative agencies abroad under the principal ministry.

b. Allocation of funds from the state budget holding fund at Vietnamese representative agencies abroad:

- The Ministry of Finance issues an order to pay from the state budget holding fund at Vietnamese representative agencies in foreign currency to allocate funds to Vietnamese representative agencies.

- The accounting process for this expenditure is as follows:

Based on the amount of foreign currency withdrawn from the state budget holding fund at representative agencies, the Ministry of Finance issues an approval notice of the budget estimate in Vietnamese dong (converted from the amount of foreign currency withdrawn from the state budget holding fund multiplied by the accounting exchange rate specified by the Ministry of Finance), recording - crediting "consular fees or other revenues outside the country" while debiting "allocation of funds to Vietnamese representative agencies abroad" for the principal ministry.

4. Control of expenditures at Vietnamese representative agencies abroad

The approved expenditure budget and the total allocated funds represent the highest limit within which budget users can spend. The head of the representative agency issues an expenditure authorization order according to the approved budget and based on national standards and norms. Depending on the nature of each expenditure item, the necessary bases for determining the expenditure authorization are as follows:

4.1. For salary and allowance items:

Based on the decision to assign for long-term work, the salary and concurrent allowance approved by the competent authority. Family members (spouse, children, parents, siblings) of personnel within the agency's establishment shall not concurrently serve as storekeepers, cashiers, accountants, or material procurement staff.

4.2. For the item of hiring foreign individuals or Vietnamese individuals:

- Decision of the Ministry in charge.

- Included in the approved budget estimate.

4.3. For expenditures related to rent for housing and office space:

- Contract signed between the lessor and the head of the representative office, approved by the Ministry in charge.

- Included in the approved budget estimate.

4.4. Purchase of automobiles:

- Document permitting purchase of vehicles from the competent authority.

- Included in the approved budget estimate.

The vehicle purchase and sale contract signed between the head of the representative office and the seller.

In the case of exchanging vehicles, the Ministry in charge decides after coordinating with the Ministry of Finance.

4.5. Procurement of other assets:

All other assets (such as machinery, equipment, office management tools, housing such as computers, photocopiers, telephones, video players, radios, refrigerators, desks, sofas, beds...) purchased according to the approved plan shall be used and managed in accordance with the fixed asset management regulations for administrative and public service units as stipulated in Decision No. 351-TC/QĐ/CĐKT dated May 22, 1997 issued by the Minister of Finance regarding the management, use, and depreciation of fixed assets in administrative and public service units.

4.6. Construction of new offices and housing:

Cases of purchasing new houses or land for construction must be carried out in accordance with the general construction regulations set forth in Decree No. 42/CP dated July 16, 1996 on the issuance of investment management and construction regulations and Circular No. 63-TC/ĐTPT dated November 2, 1996 issued by the Ministry of Finance on guiding the management and allocation of construction funds from the state budget and in compliance with the laws of the host country.

4.7. Repair, renovation, and upgrading of offices and housing:

- Included in the approved budget estimate.

- Repair, renovation, and upgrading plans approved by the competent authority.

- Compliant with the laws of the host country.

4.8. Telephones and Fax Machines:

- Each representative office is equipped with one mobile phone, which the head of the representative office is responsible for managing and using. Special cases where representative offices frequently receive delegations and engage in extensive external activities may be equipped with up to three phones.

- For international telephone and fax machines: The use of fax machines and making international calls must be approved by the head of the representative office (or authorized person) regarding the content of transactions. Departments and individuals must register the telephone and fax numbers they need to contact with the accounting department or office for verification during payment.

All faxes and international calls that are not approved by the head of the representative office (or authorized person) must be paid for by the individual using them.

4.9. Use of Vehicles and Fuel:

Based on the number of vehicles currently available at representative offices:

- One vehicle reserved for the head of the representative office for daily diplomatic reception duties.

- Remaining vehicles reserved for staff to serve daily operations.

- All official vehicles must have automobile insurance; if a vehicle accident occurs due to the fault of an individual, that individual is responsible for compensation.

Depending on the location, the head of the office establishes vehicle usage rules based on the principles of:

+ Proper maintenance of vehicles.

+ Serving the needs of the office.

+ Monthly fuel quota per vehicle.

+ Fuel distribution issues for operational vehicles:

For the vehicle reserved for the head of the representative office: serving regular diplomatic reception tasks as required by the head of the representative office.

For remaining vehicles: individuals, groups, or departments wishing to use them for work must submit a work program and content approved by the head of the representative office.

Based on the approved work program, the office department is responsible for arranging vehicles and fuel for individuals, groups, or departments to carry out their work programs.

If the fuel receipt submitted by individuals, groups, or departments does not include an approved work program by the head of the representative office, these parties must pay for it themselves.

4.10. Travel Expenses:

Heads of departments must report and coordinate with the head of the representative office on the content of registered trips included in the quarterly/yearly budget estimates.

Principles for reimbursing travel expenses for individuals:

+ For overseas or domestic trips, there must be a decision from the leadership of the Ministry in charge (by telegram or fax) sent to: the Ministry of Foreign Affairs, the head of the representative office. In special cases not included in the annual budget, the head of the representative office must report to the Ministry of Foreign Affairs or the Ministry in charge (for press, news agencies, cultural institutions, etc.) for consideration and opinion.

+ For domestic trips: Decision of the head of the representative office assigning the trip.

Individuals traveling abroad or domestically without a decision from the Ministry or the head of the representative office are not entitled to reimbursement of travel expenses.

4.11. Office Supplies:

Every quarter, groups or departments within the representative office must prepare a plan for office supply usage, send it to the finance or office department of the representative office for procurement and distribution to groups or departments in accordance with the actual allocated funds.

4.12. Equipping Collective Dining Rooms:

Where conditions permit the organization of collective dining rooms for staff, the head of the representative office may use funds to purchase necessary equipment for the kitchen. Under no circumstances should state funds be used to purchase kitchen equipment or supplies for individual households (including shared kitchens used by two to three households).

4.13. Reception, Entertaining, and Gifts:

- Reception: Groups or departments within the representative office can only provide mineral water (or tea, coffee) for guests, and may not use cigarettes, alcohol, or beer for receptions.

- Entertaining:

+ For national holidays such as National Day, the day of establishment of the Vietnam People's Army, the head of the Overseas Representative Office shall implement according to the guidance of competent authorities in Vietnam each year. The reception should be carried out with the spirit of thrift.

+ For other receptions related to daily work, working groups or departments must have plans submitted for review and decision by the head of the Overseas Representative Office.

+ Gifts: Working units in business relations must report to the head of the Overseas Representative Office for consideration and decision when they need to give gifts to their partners.

Payment for receptions and gifts mentioned above can only be made when the plans of working groups or departments are approved by the head of the Overseas Representative Office.

4.14. Overtime Allowance:

- Individuals, groups, or departments that require overtime work, if approved by the head of the Overseas Representative Office, will receive an allowance of 1 USD per hour. The limit for payment is 20 hours per person per month and not more than 200 hours per year.

- For cases where the head of the Overseas Representative Office mobilizes all staff to work overtime, depending on the specific type of work, the head of the Overseas Representative Office decides which tasks will be paid overtime allowances and which will be performed as public service without payment.

4.15. Medical Expenses:

Until there is health insurance for long-term overseas staff, all cases of illness requiring medical examination or purchasing medicine based on a doctor's prescription must be decided by the head of the Overseas Representative Office.

4.16. Disposal of Fixed Assets (TSCĐ):

The disposal of fixed assets must be approved by the Liquidation Board established by the head of the Overseas Representative Office and in accordance with the current regulations of the State on the disposal of fixed assets.

5. Procedures for Payment of Expenditures:

- Working units or individuals prepare a request for expenditure.

- Accounting staff check the supporting documents to ensure compliance with permitted regulations, submit for approval by the head of the Overseas Representative Office, and record as follows:

+ Content of expenditure (must be in accordance with the approved budget items).

+ Amount recorded in figures and in words.

+ Method of payment: cash or bank transfer.

+ Record in the corresponding budget ledger.

+ In case of purchasing materials or supplies domestically, an invoice issued by the Ministry of Finance must be provided.

6. Personal Use Expenditures:

Such as personal telephone calls (domestic and international), rent, electricity, water expenses for self-supporting personnel... the representative office is responsible for collecting from individuals according to the current regulations.

7. Recovery of Excess Budgetary Expenditure:

During the management, allocation, inspection, and settlement process, the principal ministry and the Ministry of Finance have the authority to recover excess budgetary expenditure for expenditures that violate regulations, are not for the intended purpose, lack legitimate documentation, or were improperly charged or ordered by individuals. The head of the representative office is responsible for urging timely repayment according to the decision of the principal ministry and the Ministry of Finance.

8. Adjustment of Budget Items in the Annual Budget:

Unspent budgets from previous quarters may be carried forward to subsequent quarters but expire at the end of December. Allocated budgets for specific expenditure items can only be allocated and paid for those specific items and cannot be used for other items. If adjustments between budget items are necessary, they must not exceed the total budget amount assigned to the unit and must be approved by the competent authority, specifically:

- The head of the overseas representative office has the authority to decide if the adjustment does not change the total expenditure amount and details of the budget items approved by the principal ministry.

- The principal ministry has the authority to decide if the adjustment does not change the total approved budget expenditure of the representative offices, while reporting to the Ministry of Finance.

- The Ministry of Finance has the authority to decide if the adjustment changes the total amount and details of the annual budget items reported by the Ministry of Finance.

9. Accounting System and Detailed Records of Receipts and Expenditures and Reporting Forms Established According to the Current Government Budget Ledger:

- Overseas representative offices of Vietnam must organize accounting and settlement according to the regulations stipulated in the administrative and public service accounting system (Decision No. 999-TC/QĐ/CĐKT dated November 2, 1996 of the Minister of Finance) and Article 7, Part V of Circular No. 103/1998 of the Ministry of Finance. The content of the final settlement report must comply with the approved budget items and the government budget ledger, accompanied by a balance sheet as of December 31, sent to the financial department of the principal ministry with confirmation from the head of the representative office within 45 days after the end of the year.

- The principal ministry is responsible for reviewing and compiling the annual settlement report (including the settlement reports of the representative offices) to be submitted to the Ministry of Finance no later than April 30 of the following year. The Ministry of Finance is responsible for reviewing the annual settlement reports of the principal ministries (first level), during the review process, the Ministry of Finance has the right to re-examine the annual settlement reports of the representative offices if deemed necessary.

III. IMPLEMENTATION:

This circular takes effect from January 1, 1999. The principal ministry shall guide overseas representative offices of Vietnam to implement it.

In the course of implementation, if there are difficulties, overseas representative offices of Vietnam are requested to report to the principal ministry and the Ministry of Finance for resolution.