Joint Circular No. 20/2003/TTLT/BTC-BVHTT-BNV guiding the financial management regime for units operating in the cultural and information sector that generate revenue.

JOINT CIRCULAR

JOINT CIRCULAR NO. 20/2003/TTLT/BTC-BVHTT-BNV OF THE MINISTRY OF FINANCE - MINISTRY OF CULTURE AND INFORMATION - MINISTRY OF HOME AFFAIRS DATED MARCH 24, 2003 GUIDING THE FINANCIAL MANAGEMENT REGIME FOR STATE-OWNED ENTERPRISES WITH REVENUE OPERATING IN THE FIELD OF CULTURE AND INFORMATION

To implement Decree No. 10/2002/NĐ-CP dated January 16, 2002 of the Government on the financial regime applicable to state-owned enterprises with revenue, the Ministry of Finance has issued Circular No. 25/2002/TT-BTC dated March 21, 2002.

In order to be consistent with the special characteristics of the culture and information sector, the Joint Circular of the Ministry of Finance - Ministry of Culture and Information - Ministry of Home Affairs provides additional guidance on certain aspects of the financial management regime for state-owned enterprises with revenue operating in the public cultural and information sector as follows:

I-OBJECTS:

The subject of this Circular is state-owned cultural and information enterprises operating with revenue that receive part of their operational funding from the State budget or self-fund all operational costs (collectively referred to as revenue-generating cultural and information establishments - abbreviated as CSVHTTCT), including:

- Art units: Specialized theaters (cheo, tuong, cải lương, ca-múa-nhạc, kịch, rối, xiếc...), comprehensive art troupes at various levels (including symphony orchestras).

- Museums, heritage management units, and scenic spot management units.

- Press and magazine agencies.

- Film Arts Institute and Archive, National Film Technical Center, National Cinema Screening Center.

- Public libraries.

- Information Exhibition Centers, Exhibition Houses, Cultural Information Houses.

- Other revenue-generating state-owned enterprises: Management Board of the Grand Theater, creative writers' house, International Press and Communication Cooperation Center.

- Specialized state-owned cultural and information enterprises at central and local levels in fields such as cinema, book distribution, propaganda and information (if any).

The above-mentioned state-owned enterprises fall under the scope of implementation of Decree No. 10/2002/NĐ-CP when they meet the following conditions:

- Having a decision on establishment by a competent authority in writing;

- Possessing legal personality and having a separate seal;

- Having an account at the Treasury or Bank;

- Having a financial and accounting organizational structure;

- Having legitimate sources of income.

Competent authorities have the responsibility to create favorable conditions for cultural and information establishments to implement Decree No. 10/NĐ-CP dated January 16, 2002 of the Government.

Budgetary units directly subordinate to CSVHTTCT such as training centers, research and application technology centers, research institutes are subjects implementing Decree No. 10/2002/NĐ-CP dated January 16, 2002 of the Government, applying this Circular and other guiding circulars appropriate to their respective fields of activity (education and training, scientific research...).

For CSVHTTCT with multiple independent accounting subordinates, the competent authority may allocate a stable budget to the first or second level budget unit to grant autonomy to the subordinate budget units.

Cultural and information establishments without revenue from public service activities, not falling within the scope of application of this Circular, shall have their regular operational funding provided by the State budget (both at central and local levels) and managed according to the current financial management mechanism.

II- SOURCES OF REVENUE FOR PUBLIC CULTURAL AND INFORMATION ESTABLISHMENTS:

Public cultural and information establishments have the following sources of revenue:

1- Current fees and charges as prescribed:

1.1- Library fees, fees for using archival materials in libraries.

1.2- Fees for film and screenplay evaluation, copyright registration fees, advertising activity licensing fees, content evaluation and cultural product import/export licensing fees, fees for issuing labels for artistic program releases (audio tapes, video tapes, CDs, VCDs, DVDs)...

2- Revenue tied to the activities of the unit:

2.1- Revenue from ticket sales for performances; movie tickets; exhibition tickets, museum and heritage site visit tickets...

2.2- Revenue from performance contracts between the unit and organizations and individuals both domestically and internationally; Revenue from service and performance activities organized by staff and performers within the unit and submitted to the unit under a quota system.

2.3- Revenue from service activities linked to the public service activities of the unit: Exploitation of facilities (theaters, workshops, conference halls, equipment); provision of printing, dubbing, film restoration, and film material exploitation services; exploitation of museum and library materials...

2.4- Revenue from advertising publication and broadcasting on newspapers, magazines, publications, from newspaper and magazine distribution and information dissemination activities...

2.5- Other lawful revenues retained for use as prescribed by the State.

The amount of revenue for the above items shall be agreed upon by the head of the unit in contracts with the service requesters, based on the principle of ensuring reasonable cost recovery and accumulation.

3- Revenue from subordinate units to support common activities: Subordinate budget units may retain a portion of their revenue to support higher-level budget units in carrying out common activities, the retention ratio being decided by the head of the lower-level unit.

4- Other revenues as prescribed by law, such as bank interest from production and service supply revenues...

In addition to the aforementioned revenue sources, CSVHTTCT are permitted to legally raise funds from domestic and foreign organizations and individuals to serve production and service supply activities in accordance with current regulations.

In addition to the revenue from public services mentioned above, the CSVHTTCTs are permitted to raise lawful capital from organizations and individuals both within and outside the country to serve their production and service provision activities in accordance with current regulations.

III- CONTENT OF REGULAR EXPENSES:

The CSVHTTCTs are allowed to use state budget funds and unit revenue from public services to cover regular activities according to the following contents:

1- Expenses for officials, employees, and contractual workers: Salary; wages; bonuses; allowances; collective welfare; contributions deducted and remitted for social insurance, health insurance, and trade union fees in accordance with the current system.

2- Administrative management expenses: Electricity costs, water costs, fuel costs, environmental sanitation costs, office supplies purchase costs, public service costs, travel expenses, conference fees, communication costs, propaganda costs, telephone charges, fax charges...

3- Direct professional expenses for the unit's activities according to assigned functions and tasks.

4- Research costs for scientific and technological topics at the grassroots level of the unit.

5- Training and upgrading costs for employees within the unit (excluding training costs according to state targets).

6- Rental expenses: Renting transportation means, renting houses, land, various types of equipment; hiring domestic and foreign experts, hiring labor, hiring staff training, other rentals.

7- Direct expenses for production and service activities of the unit, including: wages; raw materials and supplies; depreciation of fixed assets; commissions; taxes (if applicable) as prescribed by law.

8- Regular expenses related to fee and tax collection work as currently regulated.

9- International cooperation expenses: Outbound and inbound delegations.

10- Other expenses: Principal and interest payments on loans from domestic and foreign organizations and individuals (if applicable); using income from social welfare contributions, security and public order expenses...

IV- PUBLIC CULTURAL AND INFORMATION INSTITUTIONS THAT HAVE AUTONOMOUS FINANCIAL MANAGEMENT, SELF-DECISION MAKING AND ARE RESPONSIBLE FOR THE FOLLOWING:

Non-recurring expenses implemented in accordance with Decree No. 10/2002/NĐ-CP dated January 16, 2002 of the Government and Circular No. 25/2002/TT-BTC dated March 21, 2002 of the Ministry of Finance.

1- Regarding the use of funds from the state budget and revenue from public services:

1.1- For cultural and information institutions that fully self-fund their regular operating expenses: The competent authority shall allocate a stable budget estimate for three years to subordinate units as follows:

a) Allocate the budget estimate for fees and taxes under the state budget, including:

- Total revenue from fees and taxes.

- Amounts of fees and taxes retained by the institution for use according to regulations of the competent state authority for each type of fee and tax.

- Amounts of fees and taxes to be remitted to the state budget.

For those types of fees and taxes that are retained and remitted to the state budget at a certain percentage, the competent authority shall adjust the annual budget estimate for revenue collection to align with the unit's operations.

The supervising agency does not allocate production and service provision revenue to cultural and information institutions. Units develop revenue plans to manage throughout the year. For units with only production and service provision revenue without fee and tax revenue, the competent authority allocates a production and service provision revenue budget estimate as the basis for managing revenue and expenditure.

b) Allocate the expenditure budget:

- Allocate the total combined expenditure for regular operations from retained fee and tax revenue according to the regulations of the competent state authority.

- Non-recurring expenditures from the state budget: Funding for national-level research projects, ministry and sector-level projects; funding for national target programs; funding for state orders; funding for reduction of personnel establishment; matching funds for foreign projects; grants and loans; basic construction investment; funding for major purchases and repairs of fixed assets and other non-recurring expenditures. The Ministry in charge (for centrally-managed revenue-generating public institutions) and the local supervising agency (for locally-managed revenue-generating public institutions) allocate the budget estimates for public institutions according to current regulations.

c) In cases where units exceed the allocated stable fee and tax revenue, the unit may use the entire excess revenue (retained portion) to supplement the salary fund and operational funds of the unit according to regulations.

If the unit falls short of the allocated fee and tax revenue (retained portion), the unit must correspondingly reduce its expenditures.

For public institutions that are allocated production and service provision revenue by the competent authority, when there is excess revenue, the unit may use the entire excess revenue to increase income and strengthen material foundations, and when revenue decreases, the unit must correspondingly reduce expenditures.

1.2- For cultural and information institutions that partially self-fund their regular operating expenses: The competent authority shall allocate a stable revenue budget and expenditure budget for three years as follows:

1.2.1- Allocate the budget estimate for fees and taxes under the state budget, including:

- Amounts of fees and taxes retained for use according to regulations of the competent state authority.

- Amounts of fees and taxes retained by the institution for use according to regulations of the competent state authority for each type of fee and tax.

The supervising agency does not allocate production and service provision revenue. The unit develops a revenue plan to manage throughout the year. For units with only production and service provision revenue without fee and tax revenue, the competent authority allocates a production and service provision revenue budget estimate as the basis for managing revenue and expenditure.

For those types of fees and taxes that are retained and remitted to the state budget at a certain percentage, the competent authority shall adjust the annual budget estimate for revenue collection to align with the unit's operations.

The supervising agency does not allocate production and service provision revenue to cultural and information institutions. Units develop revenue plans to manage throughout the year. For units with only production and service provision revenue without fee and tax revenue, the competent authority allocates a production and service provision revenue budget estimate as the basis for managing revenue and expenditure.

1.2.2- Allocate the expenditure budget:

a) Regular expenditures:

- Allocate the total combined regular expenditures from the state budget for the first year of the stable period, annually increased according to the rate determined by the competent authority.

- Non-recurring expenditures from the state budget: Funding for national-level research projects, ministry and sector-level projects; funding for national target programs; funding for state orders; funding for reduction of personnel establishment; matching funds for foreign projects; grants and loans; basic construction investment; funding for major purchases and repairs of fixed assets and other non-recurring expenditures. The Ministry in charge (for centrally-managed revenue-generating public institutions) and the local supervising agency (for locally-managed revenue-generating public institutions) allocate the budget estimates for public institutions according to current regulations.

b) Non-recurring expenditures from the state budget: Funding for national-level research projects, ministry and sector-level projects; funding for national target programs; state orders funding; funding for reduction of personnel establishment; matching funds for foreign projects; basic construction investment; funding for major purchases and repairs of fixed assets: The Ministry in charge (for centrally-managed revenue-generating public institutions) and the local supervising agency (for locally-managed revenue-generating public institutions) allocate the budget estimates for public institutions according to current regulations.

1.2.3- In cases where units save on regular expenditure or increase retained fee and tax revenue compared to the allocated budget, the unit may use the entire saved funds and additional revenue to supplement the salary fund and operational funds of the unit. If the unit falls short of the allocated revenue, it must correspondingly reduce expenditures.

After the three-year stable budget period, revenue-generating public institutions report a summary to the competent authorities for review and decision on allocating a stable budget for the subsequent period.

1.2- For cultural and information institutions that partially self-fund their regular operating expenses: The competent authority shall allocate a stable revenue budget and expenditure budget for three years as follows:

After a three-year period of stable funding, units with revenue must report a summary to relevant authorities for review and decision on the allocation of stable funding for the subsequent period.

2- The staffing quota serving as the basis for preparing the budget for salary funds is the number of staff positions assigned by the competent authority up to December 31 of the preceding year.

During the course of operation, the head of a self-financing public service unit may decide on the plan for labor force utilization as follows:

2.1- Reorganize cadres, civil servants, and employees (including those who have signed labor contracts within the staffing quota) to enhance the efficiency and quality of the unit's operations. Those individuals subject to reduction in staffing quotas shall enjoy policies and benefits according to current regulations.

2.2- For self-financing public service units that fully cover their regular operational expenses, based on job requirements and financial capacity, the head may sign indefinite-term labor contracts in accordance with laws on labor; those individuals signing indefinite-term labor contracts must meet the required standards, structure of job titles, and professional qualifications as stipulated by sectoral management agencies, and be classified under the administrative public service pay scale as prescribed in Decree No. 25/ND-CP dated May 23, 1993, and enjoy rights and obligations as provided by law.

2.3- For self-financing public service units that partially cover their regular operational expenses, based on job requirements and financial capacity, the head may sign labor contracts in accordance with laws on labor but must comply with staffing quotas established by the competent authority; those individuals signing indefinite-term labor contracts must meet the required standards, structure of job titles, and professional qualifications as stipulated by sectoral management agencies, and be classified under the administrative public service pay scale as prescribed in Decree No. 25/ND-CP dated May 23, 1993, and enjoy rights and obligations as provided by law.

2.4- Heads of cultural, sports, tourism, and information centers may terminate labor contracts with individuals hired through such contracts. Procedures for terminating labor contracts shall follow the provisions of laws on labor.

2.5- Implement democratic and transparent practices as prescribed by law.

3- Salary Fund and Income: The salary fund and income of cultural, sports, tourism, and information centers are sourced from two origins:

3.1- State budget allocation for salary, wages, and allowances linked to salaries for cadres, civil servants, and employees within the staffing quota and contractual workers (for units that partially cover their regular operational expenses) shall be implemented according to Decree No. 25/ND-CP dated May 23, 1993, and current guiding documents on salaries and allowances.

3.2- Based on financial results (revenue from public services and savings on regular expenses) and the implementation of specialized tasks, the salary fund and income of cultural, sports, tourism, and information centers shall be determined according to Point 1, Section IV of Circular No. 25/2002/TT-BTC dated March 21, 2002, guiding the implementation of Decree No. 10/2002/NĐ-CP dated January 16, 2002, regarding financial systems applicable to self-financing public service units. Units shall establish internal rules for salary and wage payments, discuss them openly, and reach consensus at the meeting of cadres, civil servants, and employees.

Based on the unit's internal rules for salary and wage payments and the determined salary fund, the head of the unit decides the monthly salary and wage payments for cadres, civil servants, employees, and contractual workers according to their work performance.

3.3- At the end of the year, any unused salary funds are transferred to the income reserve fund and carried over to the next year for continued use.

4- Establishing Internal Expenditure Regulations:

- Within the scope of the unit's financial resources (including state budget allocations and revenue from public services), the head of the cultural, sports, tourism, and information center unit establishes standards, norms, and internal expenditure regulations for management and professional activities higher or lower than the national standards, suitable for the unit's specific operations.

- In internal expenditure regulations, cultural, sports, tourism, and information centers should prioritize expenditures on professional activities to ensure the quantity and quality of specialized cultural and information activities.

- The aforementioned standards, regulations, and expenditure norms must be discussed openly within the unit; internal expenditure regulations serve as the basis for the head of the unit to manage and settle accounts for funds from the state budget and revenue from public services, providing a legal foundation for the State Treasury to control expenditures.

5- Allocation of Funds from the State Budget:

Based on the state budget allocation, the finance agency allocates regular funds (for units that partially cover their costs) through the State Treasury under Item 134 "Other Expenses" in the State Budget Schedule according to corresponding types of items.

If allocations have been made according to the items in the State Budget Schedule, the head of the unit has the authority to adjust the expense items within the total amount of allocated regular funds.

For non-regular expense funds, the finance agency will allocate funds according to the current State Budget Schedule.

6- Regarding Depreciation and Utilization of Fixed Assets: Cultural, sports, tourism, and information centers engaged in service provision and production, supply of services, and operations must implement depreciation of fixed assets based on Decision No. 166/199/QĐ-BTC dated December 30, 1999, issued by the Minister of Finance on the management, use, and depreciation of fixed assets, and current guiding documents of the State.

In special cases, the head of the unit may decide to apply a higher depreciation rate to recover capital promptly, but it must be consistent with the asset's lifespan, technical capabilities, and the service recipient's payment capacity.

The entire amount of depreciation of fixed assets is recorded as service costs in contracts between cultural, sports, tourism, and information centers and parties requesting service production.

7- State-owned enterprises with the need to liquidate assets shall establish an Asset Liquidation Committee pursuant to Decision No. 55/2000/QĐ-BTC dated April 19, 2000 of the Minister of Finance on the issuance of regulations governing the management of the disposal of state assets at administrative and public service agencies. The proceeds from asset liquidation, after deducting liquidation costs (weighing, measuring, transporting, determining technical parameters, overtime pay if applicable...), shall be transferred into the development fund for public service activities of the entity. In cases where assets formed from borrowed funds are liquidated and the loan has not been fully repaid, the entity shall use the proceeds from the liquidation (after deducting liquidation costs) to repay the loan; if the loan is fully repaid, the proceeds may be transferred into the development fund for public service activities of the entity.

8- At year-end, any regular operating funds allocated from the State Budget and income from public services of state-owned enterprises that have not been expended shall be carried over to the next year for continued expenditure and settlement within the accounting period of the following year. Based on reconciliation between the National Treasury and the entity by December 31, the National Treasury shall process the transfer of unspent funds to the next year for state-owned enterprises according to Circular No. 81/2002/TT-BTC dated September 16, 2002 of the Ministry of Finance, and simultaneously notify the corresponding financial authority in writing for their knowledge and management.

9- State-owned enterprises shall implement accounting records in accordance with Circular No. 121/2002/TT-BTC dated December 31, 2002 of the Ministry of Finance guiding accounting for revenue-generating public service units.

V- IMPLEMENTATION PROVISIONS:

This Circular takes effect from January 1, 2003.

Other financial management matters shall be implemented in accordance with the provisions of Circular No. 25/2002/TT-BTC dated March 21, 2002 of the Ministry of Finance.

Vietnam Radio, Vietnam Television, and Vietnam News Agency shall implement separate financial management mechanisms pursuant to the Prime Minister's Decisions, and shall not follow the guidelines set out in this Circular.

Any difficulties encountered during implementation shall be reported back to the Joint Ministries for appropriate amendments and supplements.