Joint Circular No. 23/2004/TTLT/BTC-BQP guiding the preparation, implementation, settlement of state budget, and management of state assets for certain activities under the defense sector.

JOINT CIRCULAR

Guidelines for the preparation, implementation, settlement of state budget, and management of state assets for certain activities in the defense sector

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Pursuant to the State Budget Law No. 01/2002/QH11 dated December 16, 2002 of the National Assembly;
Based on Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government detailing and guiding the implementation of the State Budget Law;
Pursuant to Decree No. 10/2004/NĐ-CP dated January 7, 2004 of the Government on the management and use of the state budget and state assets for certain activities in the fields of national defense and security;
The Ministry of Finance and the Ministry of National Defense hereby provide guidelines for the preparation, implementation, and settlement of the state budget in the defense sector as follows:

I. GENERAL PROVISIONS

1. State budget expenditure for the defense sector includes: Expenditure for defense work under the responsibility of the Ministry of National Defense as stipulated in Clause 1, Article 5 of Decree No. 10/2004/NĐ-CP dated January 7, 2004 of the Government;

- Expenditure for defense work at ministries, agencies equivalent to ministries, government agencies, central-level agencies, and localities as stipulated in Point a, Clause 3, Article 5 and Clause 1, Article 6 of Decree No. 10/2004/NĐ-CP dated January 7, 2004 of the Government; this expenditure is included in the budgets of central agencies and localities.

2. State budget revenue in the defense sector includes:

- Revenue from state-owned enterprises under the Ministry of National Defense; from units using the state budget utilizing material and technical facilities for production, business, and service provision with income according to current state regulations.

- Revenue from administrative penalties, fines retained according to current regulations; revenue from the disposal of fixed assets; revenue from the disposal of weapons, equipment, and other revenues as prescribed by law.

3. All revenues and expenditures in the defense sector must be recorded in Vietnamese Dong according to the fiscal year, budget level, and State Budget Classification. Revenues and expenditures in foreign currency, in kind, or in labor days must be converted into Vietnamese Dong based on the exchange rate or the value of goods or labor day value as prescribed by the competent authority to record revenues and expenditures at the time they occur.

4. Revenues designated to fund expenditures as prescribed by law, as stipulated in Article 2 of Decree No. 10/2004/NĐ-CP dated January 7, 2004, must be summarized and reported in the annual revenue and expenditure budget forecast of the unit, reported to the Ministry of National Defense for consolidation and reporting to the Ministry of Finance to submit to the Prime Minister. The use of such revenues must have the approval of the competent authority. Revenues of non-profit organizations under the Ministry of National Defense shall be implemented according to current regulations.

5. All state budget expenditures in the defense sector must be inspected and controlled before, during, and after the disbursement process. Expenditures must be within the allocated budget, in accordance with regulations, standards, and expenditure quotas prescribed by the competent state agency, and approved by the head of the budget-using unit or the authorized person. The person issuing the expenditure decision is responsible for their decision; if there is an error, they must compensate the public treasury and may also face disciplinary action, administrative penalties, or criminal prosecution depending on the nature and severity of the violation.

6. Units under the Ministry of National Defense are responsible for:

a) Paying all taxes and other state budget revenues (if any) fully and on time into the state budget as prescribed by law.

b) Managing and using state-provided funds and support strictly for their intended purposes, in accordance with regulations, economically, and effectively;

c) Organizing accounting, recording, reporting, and settling revenues paid into the state budget and the use of funds according to the national accounting system, State Budget Classification, and the provisions of Circular No. 59/2003/TT-BTC dated June 23, 2003 of the Ministry of Finance guiding the implementation of Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government, and this Circular.

Scope of application: This Circular provides guidelines for the preparation, implementation, settlement of the state budget, and management of state assets for the Ministry of National Defense and its subordinate units. Matters not covered in this Circular regarding the preparation, implementation, and settlement of centralized construction investment expenditures and national target program expenditures shall be carried out in accordance with Circular No. 59/2003/TT-BTC dated June 23, 2003 of the Ministry of Finance guiding the implementation of Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government, Circular No. 79/2003/TT-BTC dated August 13, 2003 guiding the management, allocation, and settlement of state budget expenditures through the State Treasury, and current guiding documents. Ministries, agencies equivalent to ministries, government agencies, central-level agencies, and localities with responsibilities for defense work shall implement in accordance with the State Budget Law, Decree No. 60/2003/NĐ-CP dated June 6, 2003, Decree No. 10/2004/NĐ-CP dated January 7, 2004, and current guiding documents.

II. PREPARATION OF THE ANNUAL STATE BUDGET FORECAST

1. Guidelines for the preparation of the state budget forecast and notification of the estimated budget allocation:

1. 1. Based on the Prime Minister's Directive on the development plan and the state budget forecast for the following year, the Ministry of Finance issues a circular providing guidance on requirements, contents, deadlines for preparing the state budget forecast. Before June 10 of the preceding year, the Ministry of Finance notifies the estimated budget allocation for the Ministry of National Defense including the total amount and each budget expenditure category.

1. 2. Based on the Prime Minister's Directive, the circular providing guidance, the estimated budget allocation notified by the Ministry of Finance, and specific requirements for defense tasks, the Ministry of National Defense notifies the estimated budget allocation for secondary budget units and tertiary budget units directly related to primary budget units as stipulated in Article 20 of Decree No. 10/2004/NĐ-CP dated January 7, 2004, ensuring that the estimated allocations to budget units are consistent in total amount and structure with the estimated state budget allocation announced by the Ministry of Finance.

1. 3. Budgetary units under the Ministry of National Defense shall guide and notify the estimated budget allocation according to the following principles: - Higher-level units shall guide and notify the estimated budget allocation to directly subordinate lower-level units; - The estimated allocation to directly subordinate budgetary units must be consistent with the total amount and structure of the estimated allocation notified by the directly superior unit.

2. Requirements for preparing the state budget estimate:

2. 1. The state budget estimate must include all revenue and expenditure items, including those revenues retained for expenditure as prescribed and detailed expenditures from such revenues; it must comply with policies and regulations and be calculated based on standards and norms issued by competent state agencies.

2. 2. The state budget estimate must be prepared in accordance with the requirements, contents, forms, and deadlines stipulated in this Circular, the Circular guiding the requirements, contents, and deadlines for preparing the annual state budget estimate issued by the Ministry of Finance, and detailed according to the State Budget Itemization.

2. 3. The state budget estimate of higher-level budgetary units must be compiled based on the consolidation of the state budget estimates of subordinate budgetary units and analyzed according to sources of funding and areas of expenditure.

2. 4. The state budget estimate must be accompanied by a detailed explanatory report on the basis and grounds for calculating each revenue and expenditure item; it must analyze and compare with the projected actual performance and the estimated budget allocation. For expenditure items requiring high confidentiality, the estimate only records the aggregate amount without detailed explanation.

Based on Decision No. 41/2003/QĐ-TTg dated March 26, 2003 of the Prime Minister regarding the List of State Secrets within the Defense Sector and Decision No. 48/2003/QĐ-BQP dated May 8, 2003 of the Ministry of National Defense regarding the List of Confidential State Secrets within the Defense Sector, the Joint Ministries provide guidance on expenditure items requiring high confidentiality in the defense sector as follows:

a) Expenditure items related to manpower, organization (wages, various allowances, subsidies; various food expenses, recruitment and discharge expenses, expenses calculated based on organizational and manpower norms);

b) Expenditure items for purchasing, investing in construction, and maintaining, repairing specialized assets serving national defense as stipulated in Clause 1, Article 26 of Decree No. 10/2004/NĐ-CP dated January 7, 2004 of the Government;

c) Expenditure items for purchasing specialized materials for defense purposes.

d) Expenditure items for training (infantry training, branch training), exercises, troop movements, military cargo transportation, combat readiness preparation;

đ) Expenditure items for implementing special projects, programs, research topics, and scientific and technological projects serving military purposes;

e) Secret expenditure items (intelligence, security).

2. 5. The central state budget estimate ensuring coverage must be consolidated and submitted to higher levels according to the分级管理权限的国防部；地方财政保障部分应提交同级财政机关，由其提请地方人民代表大会决定，并逐级报送上级机关至国防部汇总。收到地方政府关于本单位预算分配的通知后，地方军事机关应逐级上报至国防部。

3. Basis for preparing the state budget estimate:

3. 1. Tasks for economic and social development: Guiding the construction and development of regular, elite, and gradually modernized armed forces within the five-year plan and long-term goals set by the Party and the State;

3. 2. Specific tasks of the Ministry of National Defense; manpower, organization, equipment, construction volume, maintenance, preservation, repair, production of means of transport within the planned year;

3. 3. Policies, systems, standards, and norms for budget expenditure prescribed by competent state agencies; In cases where amendments or supplements to these documents are necessary, they must be studied, amended, supplemented, and promulgated before the time for preparing the annual state budget estimate;

3. 4. The Prime Minister's Directive on the formulation of plans for economic and social development and the state budget estimate for the next year; Circulars guiding the preparation of the state budget estimate issued by the Ministry of Finance; Guidance from provincial People's Committees on the preparation of budget estimates at local levels.

3. 5. The estimated budget allocation notified by the competent authority;

3. 6. Implementation status of the previous year's budget estimate and some recent years;

3. 7. Division of budget expenditure tasks as stipulated in Articles 5 and 6 of Decree No. 10/2004/NĐ-CP dated January 7, 2004 of the Government.

4. Preparation of the state budget estimate:

4. 1. Budgetary units under the Ministry of National Defense shall prepare their own revenue and expenditure budget estimates within their assigned tasks and submit them to their direct superior management agencies. Direct superior management agencies (in cases not being first-level budgetary units) shall examine and consolidate the budget estimates of subordinate units and prepare their own revenue and expenditure budget estimates, reporting to their direct superior budgetary units up to the Ministry of National Defense.

4. 2. The Ministry of National Defense shall review the budget estimates prepared by subordinate units, on the basis of which it shall consolidate and prepare its own revenue and expenditure budget estimates within its management scope, submitting them to the Ministry of Finance, the Ministry of Planning and Investment (for the part of the budget estimate for national reserve expenditure and centralized basic construction investment of the state budget), and the program management ministry (for the part of the budget estimate for national target program expenditure).

4. 3. Time for submission of reports: The Ministry of National Defense shall submit the state budget estimate report to the Ministry of Finance, the Ministry of Planning and Investment, and the program management ministry before July 20 of the preceding year. Based on the characteristics of the units, the Ministry of National Defense shall specify the time for preparing and submitting the state budget estimate report for its subordinate units accordingly.

5. Budget preparation forms for annual state budgets:

The forms for preparing the budget estimate shall be carried out according to Appendix No. 2 of Circular No. 59/2003/TB-BTC and the Circular guiding the preparation of the annual state budget estimate issued by the Ministry of Finance.

6. Organization of work on the state budget estimate:

After announcing the estimated budget allocation figures and receiving the Ministry of National Defense's budget report, the Ministry of Finance organizes discussions on the budget with the Ministry of National Defense. During the discussion process, if there are still differing opinions between the Ministry of Finance and the Ministry of National Defense, the Ministry of Finance has the responsibility to report to the Prime Minister for decision-making.

7. Budget Decision:Based on the National Assembly's Resolution on the State budget estimate and central budget allocation, the Ministry of Finance submits the Prime Minister to assign revenue and expenditure tasks from the State budget before November 20 of the previous year and guide the revenue and expenditure tasks for the Ministry of National Defense before November 25 of the previous year.

III. IMPLEMENTATION OF THE STATE BUDGET

1. Allocation and Assignment of the State Budget Estimate:

       1.1. After being assigned the State budget estimate by the Prime Minister, the Ministry of National Defense proceeds to allocate and assign the State budget estimate to second-level and third-level budget units directly related to first-level budget units and authorizes second-level units to allocate and assign the budget estimate to subordinate budget-using units. The allocation and assignment to subordinate units must be completed before December 31 of the previous year and according to the principle:

        a) The total amount allocated to subordinate units shall not exceed the budget estimate assigned by the Prime Minister both in total amount and in detail by each spending category;

        b) The budget estimate allocated to subordinate units must be detailed according to the main spending categories in the State Budget Manual;

        c) When allocating the assigned budget estimate, the allocating unit must ensure the allocation of funds and project expenses for expenditures that have been advanced by the budget;

        d) For construction investment expenditures, priority should be given to important ongoing projects; for new projects, allocation and assignment of the budget estimate can only occur when sufficient conditions are met as stipulated by laws on investment management and construction.

1. 2. Regular expenditure budget estimates allocated to budget units are distributed according to each type in the State Budget Manual under the following groups:

a) The personal payment category includes items 100, 101, 102, 103, 104, 105, 106, 108, and 122 of the current State Budget Manual.

b) The specialized business activity expense category includes items 109, 110, 111, 112, 113, 114, 115, 116, 117, and 119 of the current State Budget Manual.

c) The procurement and repair expense category includes items 118, 144, 145, and regular expenditure construction within item 147, 148, 149 of the current State Budget Manual.

d) The other expense category includes items not included in the three categories mentioned above of the current State Budget Manual.

For expenditures related to national target programs; large procurement and repair expenditures; regular expenditure construction; economic public service expenditures, the annual budget estimates allocated to budget units are also distributed according to the progress of each quarter.

1. 3. In cases where certain expenditure tasks cannot be clearly identified in the initial year's budget estimate, the Ministry of National Defense may retain them for later allocation but must submit the allocation plan to the Ministry of Finance for review according to the procedures specified in Points 1.4 and 1.5 of Part III of this Circular.

1. 4. The allocation plan for the State budget estimate for subordinate units, including unallocated amounts and centralized expenditures of the Ministry of National Defense, must be submitted to the Ministry of Finance for review. The Ministry of National Defense is responsible for reviewing the allocation plans for the State budget estimate of second-level budget units authorized by the Ministry of National Defense to allocate the budget estimate. Based on the guidance provided in this Circular, the Ministry of National Defense specifies the procedures and deadlines for reviewing the allocation plans for the State budget estimate of second-level budget units. The review content includes:

- Reviewing the accuracy of the allocation figures from the Ministry of National Defense to subordinate units against the content of the budget estimate assigned by the Prime Minister

- Ensuring compliance with policies, regulations, expenditure standards, and norms. Through the review, if it is found that the allocation plan of the Ministry of National Defense does not meet these requirements, the Ministry of Finance will request the Ministry of National Defense to adjust accordingly. If the Ministry of National Defense disagrees with the adjustment requirements of the Ministry of Finance, it must report to the Prime Minister for consideration and decision.

1. 5. Within seven working days from the date of receipt of the allocation plan for the State budget estimate from the Ministry of National Defense, the Ministry of Finance is responsible for reviewing and issuing a written notification of the review results to the Ministry of National Defense.

1. 6. After the budget allocation plan is agreed upon by the financial authority, the Ministry of National Defense decides to assign the State budget estimate to subordinate units, simultaneously sending it to the Ministry of Finance, the State Treasury, and the local State Treasury for coordination in implementation. After receiving the review comments from the Ministry of National Defense, the second-level budget unit decides to assign the State budget estimate to subordinate units, simultaneously sending it to the Ministry of National Defense and the local State Treasury.

1. 7. In cases where the budget estimate is supplemented from the reserve fund or increased due to decisions by competent authorities, the Ministry of National Defense must allocate it to the using units according to the assigned objectives and send it to the Ministry of Finance, the State Treasury, and the local State Treasury.

2. Adjusting budget estimates allocation:

When it is necessary to adjust the budget estimate between units under and directly under the Ministry of National Defense or between groups of items within the budget estimate without changing the total amount and details by spending category assigned, the Ministry of National Defense issues a letter requesting an adjustment in the allocation plan to the Ministry of Finance and the State Treasury. The Ministry of Finance is responsible for reviewing the request for adjustment of the budget estimate according to the provisions at Point 1.4, 1.5 of Part III of this Circular. Based on the consensus of the Ministry of Finance, the Ministry of National Defense decides to adjust the allocated budget estimate, simultaneously sending it to the Ministry of Finance, the State Treasury, and the local State Treasury. In cases where second-level budget units of the Ministry of National Defense are authorized to allocate and assign the budget estimate, they are also authorized to adjust the budget estimate. After receiving the review comments from the Ministry of National Defense, the second-level budget unit decides to adjust the allocated budget estimate, simultaneously sending it to the Ministry of National Defense and the local State Treasury.

In the case where the second-level budgetary unit of the Ministry of National Defense is authorized to allocate and assign budgets, it is also authorized to adjust the budget. After receiving the review opinion of the Ministry of National Defense, the second-level budgetary unit decides on the adjustment of the assigned state budget, simultaneously sending it to the Ministry of National Defense and the State Treasury where transactions take place.

3. Provisional funding:

3. 1. In the case where the state budget is delayed in allocation or the allocation results have not been agreed upon by the Ministry of Finance, the Ministry of Finance and the State Treasury temporarily provide funds according to the provisions of Article 45 of Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government.

3. 2. To ensure regular living expenses for troops at the beginning of the year, upon the proposal of the Ministry of National Defense, the Ministry of Finance and the State Treasury implement temporary payment of salaries, allowances, food expenses, and part of other expenditures in December of the previous year. The level of temporary payment is equivalent to the average monthly expenditure of the aforementioned items in the previous year.

4. Budget management for quarters

4. 1. Based on the annual budget expenditure assigned and the requirements of tasks to be spent in the quarter, budgetary units under the Ministry of National Defense establish detailed quarterly budget expenditure needs (divided by month) according to the groups of expenditure items specified in Point 1.2, Part III of this Circular, and send them to the State Treasury where transactions take place and the superior management agency before the 15th day of the last month of the preceding quarter. Expenditures for individual payments and expenditures with regular characteristics must be evenly distributed throughout the year to be paid according to a set system. Expenditures with seasonal characteristics or that occur at certain times such as basic construction investment, major purchases, repairs, and other non-regular expenditures must be implemented according to the progress recorded in the assigned budget.

The Ministry of National Defense compiles quarterly expenditure needs (divided by month) and sends them to the Ministry of Finance before the end of the last month of the preceding quarter.

4. 2. The Ministry of Finance bases its budget management plan for the quarter on the revenue capacity and the quarterly expenditure needs, ensuring sources to meet the expenditure needs within the budget and the established systems for units under the Ministry of National Defense. In special cases requiring rearrangement of expenditures according to priority or suspension of payments for some expenditures, the Ministry of Finance has the responsibility to notify the Ministry of National Defense to proactively implement. If by the first day of the first month of the quarter, the Ministry of National Defense does not receive a notification from the Ministry of Finance, it will be considered that the expenditure needs registered by the Ministry of National Defense will be guaranteed in terms of sources.

4. 3. In the event of urgent expenditures that cannot be postponed within the scope of the assigned annual state budget but exceed the quarterly expenditure needs sent to the State Treasury by the budgetary unit, the State Treasury still pays and promptly reports through the State Treasury system to the Ministry of Finance to proactively balance the sources.

5. Conditions for state budget expenditure:

5. 1. Already included in the assigned state budget. In cases where the state budget and budget allocation have not been decided by the competent authority, the Minister of Finance decides to temporarily provide funds for non-postponable tasks.

5. 2. In accordance with the standards, norms, and rates issued and applied by the competent state agencies in the field of national defense;

5. 3. Approved by the head of the unit using the state budget or the person authorized to decide on expenditure;

5. 4. In addition to the above conditions, when using state budget capital or funds for basic construction investment, equipment procurement, work tools, and other activities that require bidding or price verification, such activities must be organized according to the legal regulations.

In cases permitted to designate contractors according to government regulations, price verification must be conducted, and the person making the decision to designate the contractor must bear responsibility before the Prime Minister regarding the prices and quality of equipment and works.

5. 5. Regular expenditures are evenly distributed throughout the year for payment; expenditures with seasonal characteristics or that only occur at certain times such as basic construction investment, major purchases, repairs, and other non-regular expenditures must be implemented according to the quarterly budget assigned by the Ministry of National Defense together with the annual budget assignment.

6. Principles for payment and settlement of state budget expenditures:

Based on the assigned state budget and the requirements of expenditure tasks of the unit according to the established standards, norms, and rates, the Ministry of Finance and the State Treasury implement payment and settlement of state budget expenditures according to the principle of direct payment from the State Treasury to suppliers of goods and services and contractors; or to budget-using units for expenditures with high confidentiality requirements. Payment of centralized basic construction investment capital and foreign currency payment and settlement are carried out according to the regulations of the Minister of Finance. The Ministry of Finance implements state budget payments in two forms: payment and settlement according to the budget from the State Treasury and payment and settlement by cash order form. Annually, the Ministry of Finance announces the contents of payments by cash order form in the notification of the results of reviewing the budget allocation plan of the Ministry of National Defense.

7. PAYMENT AND SETTLEMENT ACCORDING TO THE BUDGET PROJECTION FROM THE STATE TREASURY:

7. 1. Based on the quarterly expenditure needs already sent to the State Treasury where transactions take place, according to the requirements of expenditure tasks, the head of the budgetary unit establishes a budget withdrawal request form, accompanied by payment documentation (except for expenditures with high confidentiality requirements), and sends it to the State Treasury where transactions take place for spending or providing funds to subordinate budgetary units. In cases where the competent authority notifies adjustments to the quarterly expenditure needs, the unit can only spend within the adjusted limits.

7.2. The State Treasury at the transaction location shall base on the payment file (excluding high confidentiality disbursements under Items 100, 102, 108, 113, 117, 118, 119, 139, 145, 147, 148, 148 and Sub-items 03, 99 of Item 105; Sub-item 03 of Item 109; Sub-item 10 of Item 111; Sub-item 99 of Item 134 and of Item 140 in the current State Budget Structure), the conditions for disbursement stipulated in Section 5 - Part III of this Circular, and the budget withdrawal slip issued by the head of the budgetary unit or the authorized person to make payments. For high confidentiality disbursements, the Ministry of National Defense and the budget users shall be responsible for the reasonableness and legality of such disbursements.

7.3. In cases where the conditions for direct payment through the State Treasury have not been met for all disbursements, the State Treasury shall provide advance payments for certain disbursements according to the regulations of the Minister of Finance. After completing the work and having sufficient payment vouchers, the advance payment shall be converted to actual disbursement.

7.4. When withdrawing the budget for expenditure, the budgetary units and the State Treasury shall record the expenditure items accurately according to the State Budget Structure within the total amount of the group of items allocated in the approved budget. For groups of items that are withdrawn from the budget for all items, they must still be recorded according to the correct expenditure item. In case it is necessary to adjust the budget between groups of items, the budgetary unit must report to the superior management agency to implement according to the provisions of Section 2 - Part III of this Circular.

7.5. In cases where budget-using units do not open budget accounts at the State Treasury (Level 3 and Level 4 budgetary units) but receive funds from higher levels through Payment Orders (as stipulated in Article 18 of Decree No. 10/2004/NĐ-CP dated January 7, 2004), the contents of expenditures on Payment Orders must be detailed according to groups of expenditure items. When withdrawing funds for expenditure, they must be subject to expenditure control by the State Treasury as stipulated in Point 7.2 above.

8. Payment and settlement by means of a payment order:

The tasks of payment and settlement by means of a payment order include: Payments to enterprises without regular relations with the budget, recording revenue and expenditure of the state budget for specific items and some unexpected items, and other payments as decided by the Minister of Finance. Based on the allocated state budget and the requirements for implementing the payment tasks, the Ministry of Finance will examine and check each payment request and if the payment conditions stipulated in Section 5 - Part III of this Circular are met, issue a payment order to the Ministry of National Defense. The State Treasury will execute the withdrawal of the state budget fund and transfer money into the deposit account of the Ministry of National Defense's budgetary unit.

9. ADVANCE BUDGET DRAWDOWN:

Based on the proposal of the Ministry of National Defense, the Minister of Finance issues a decision to prepay the next year's state budget estimate in cases where important and urgent tasks arise that need to be implemented according to the system prescribed by the Government and the Prime Minister but are not arranged in the budget and the reserve fund cannot meet the needs. The total prepayment of the next year's state budget estimate shall not exceed 20% of the current year's allocated budget expenditure for the corresponding task or the estimated allocation of the next year's state budget estimate already announced. The Ministry of Finance and the State Treasury shall implement the prepayment according to the procedures prescribed in Section 7 or Section 8 - Part III of this Circular.

10. Opening accounts to receive state budget funds:

The Ministry of National Defense (Level 1 budgetary unit), Level 2 and Level 3 budgetary units may directly relate to the Level 1 budgetary unit to open budget accounts and deposit accounts; Level 3 budgetary units may directly relate to Level 2 budgetary units, Level 4 budgetary units to open deposit accounts at the State Treasury at the transaction location to receive funds from higher levels, allocate to lower-level budgetary units, or spend according to regulations. All levels of budgetary units under the Ministry of National Defense shall open budget accounts and deposit accounts at the State Treasury at their respective levels according to the guidance of the Ministry of Finance; they shall be subject to inspection by the Ministry of Finance and the State Treasury during the process of payment and use of funds. It is strictly prohibited for budget-using units to withdraw budgets and transfer them into deposit accounts, except in cases prescribed in Article 18 of Decree No. 10/2004/NĐ-CP dated January 7, 2004 of the Government. The State Treasury shall specify the procedures for opening accounts for units.

11. Supplementing the budget:

During the implementation of the budget, in cases where important unexpected defense works and other urgent tasks not arranged or insufficiently arranged in the allocated budget remain unmet even after rearranging expenditures, the units shall report to their superior agencies, the Ministry of National Defense shall aggregate and report to the Ministry of Finance. The Ministry of Finance shall be responsible for inspecting and reviewing, and if necessary, report to the Prime Minister for decision (or decide according to the delegation) to handle according to Article 7 of Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government.

12. Reporting system:

Reporting on the situation of revenue and expenditure implementation, accounting reports, finalization, and financial statements shall be carried out in accordance with Article 61 of the State Budget Law and reporting systems prescribed by the Ministry of Finance. In cases where the Ministry of National Defense fails to submit reports on time, the Ministry of Finance shall issue a decision to suspend budget payments and notify the State Treasury to jointly implement.

IV. Accounting and Finalization of the State Budget

1. Responsibilities of agencies and units:

1.1. Budgetary units at all levels under the Ministry of National Defense:

a) The Ministry of National Defense is the Level 1 budgetary unit, directly receiving the annual state budget estimate assigned by the Prime Minister and directly relating to the Ministry of Finance, and is responsible for:

- Being accountable to the State for organizing the organizational structure, implementing accounting and finalization of the budget of its own unit and subordinate budgetary units' accounting and finalization of the budget according to regulations;

- Reviewing and being responsible for the results of reviewing the finalization reports of Level 2 and Level 3 subordinate budgetary units; compiling quarterly reports and annual finalization reports to send to the Ministry of Finance.

b) Military Regions, Corps, Services, Arms, General Departments, and equivalent units are budgetary entities at level 2, allocated and assigned budgets by the Ministry of National Defense, responsible for:

- Organizing the accounting work and finalizing the budget of their own unit and the accounting and finalizing the budget of subordinate budgetary entities at level 3 and below in accordance with regulations;

- Reviewing and being responsible for the results of reviewing the finalization reports of budgetary entities at level 3 and 4 directly under them.

c) Divisions and equivalent units are budgetary entities at level 3, which are budget users, directly receiving budget allocations from budgetary entities at level 2 or level 1, responsible for:

- Organizing the accounting work and finalizing the budget of their own unit and the accounting and finalizing the budget of subordinate budgetary entities at level 3 and below in accordance with regulations;

- Reviewing and being responsible for the results of reviewing the finalization reports of budgetary entities at level 4 directly under them.

d) Regiments and equivalent units are budgetary entities at level 4, directly relating to budgetary entities at level 2.

đ) Units without independent budgets, which are basic expenditure budget levels, shall record the receipt of funds from higher-level units for expenditure and settle accounts with higher-level units.

1. 2. The Ministry of Finance is responsible for examining the annual finalization report of the Ministry of National Defense, handling it within its authority, and issuing an examination notification on the finalization report to the Ministry of National Defense within thirty working days from the date of receipt of the complete annual finalization report of the Ministry of National Defense.

2. Accounting organization of the state budget:

Budgetary entities at all levels of the Ministry of National Defense must organize the accounting system of the state budget, implement accounting and finalization work according to the laws on accounting; submit accounting reports in accordance with the state accounting system and other regulatory legal documents on accounting and statistics. The application of specific contents to suit the characteristics of the Ministry of National Defense must be agreed upon and confirmed in writing by the Ministry of Finance.

3. Closing the books of the state budget accounting:

At the end of each accounting period (month, quarter, year), budgetary entities at all levels under the Ministry of National Defense must carry out the closing of the accounting books in accordance with Circular No. 59/2003/TT-BTC dated June 23, 2003, of the Ministry of Finance "Guidelines for Implementing Decree No. 60/2003/NĐ-CP dated June 6, 2003, of the Government detailing and guiding the implementation of the State Budget Law." In cases where account balances need to be transferred according to Point 4.1.7 - Section 4 - Part V of Circular No. 59/2003/TT-BTC, budgetary entities must prepare a letter requesting the transfer of balances, confirmed by the State Treasury where transactions take place, to be sent to the Ministry of National Defense for consolidation and forwarded to the Ministry of Finance for consideration of transferring balances to the next year.

4. Principles for preparing the finalization report of the state budget:

4. 1. Data in the finalization report must be truthful, accurate, and complete. The content of the finalization report of the state budget must comply with the items recorded in the assigned budget and detailed according to the State Budget Schedule. The Minister of National Defense and the heads of budget-using units must bear legal responsibility for the accuracy, truthfulness, and completeness; they are responsible for any incorrect accounting and finalization of revenues and expenditures.

4. 2. Reports on the implementation of quarterly budget estimates and annual finalization of budgetary entities at lower levels must be submitted to the directly superior budgetary entity, the Ministry of National Defense must consolidate and submit the report to the Ministry of Finance in accordance with the prescribed format and time. In addition to the report format prescribed by the Minister of Finance, the annual finalization report of the Ministry of National Defense must be accompanied by the following documents:

 - Summary of approved finalization data for subordinate units, including retained revenue for expenditure as stipulated (if applicable);

- Explanation and clarification of reasons for achieving or not achieving the assigned budget targets according to each indicator and any recommendations (if applicable);

- Confirmation from the State Treasury where transactions take place.

4. 3. Annual finalization reports of budgetary entities and the Ministry of National Defense must not show expenditures exceeding revenues.

4. 4. For funds from local government budgets, local military agencies must submit quarterly reports and annual finalization reports to local financial authorities at the same level, and also send them to higher-level authorities up to the Ministry of National Defense for monitoring and management, and to the Ministry of Finance.

5. Procedures for preparing, submitting, and reviewing annual finalization of the state budget:

5. 1. Lower-level budgetary entities must prepare the annual finalization report and submit it to the higher-level budgetary entity. After receiving the finalization report from the lower-level budgetary entity, the head of the higher-level budgetary entity must review the finalization and notify the result of the review to the lower-level budgetary entity. Within ten days from the date of receipt of the review notification, the lower-level budgetary entity may provide further explanations for reconsideration; if there are no objections, it will be considered accepted for implementation.

5. 2. The Ministry of National Defense must consolidate and prepare the annual finalization report and submit it to the Ministry of Finance. The Ministry of Finance must examine and issue an examination notification on the finalization report to the Ministry of National Defense in accordance with Point 1.2, Section 1, Part IV of this Circular.

5. 3. During the Ministry of National Defense's review of the annual finalization of budgetary entities at level 2, the Ministry of Finance may participate in the review of the finalization of some units depending on the conditions and specific content.

5. 4. In addition to the annual finalization report form and accompanying documents, the reviewing agency may request the finalizing unit to explain or provide additional details on certain expenditure items (if deemed necessary) before deciding to issue a notification approving the annual finalization report.

5. 5. The deadline for submitting reports on the implementation of quarterly budget estimates and annual finalization is as follows:

The Ministry of National Defense must consolidate and submit the quarterly budget estimate implementation report to the Ministry of Finance no later than twenty-five days after the end of the quarter, and submit the annual finalization report to the Ministry of Finance no later than October 1st of the following year. The Ministry of National Defense must specify the submission deadlines for budgetary entities at levels 2, 3, and 4 to ensure timely submission to the Ministry of Finance.

6. All budgetary units under the Ministry of National Defense must strictly comply with regulations on accounting work and state budget settlement, and must prepare state budget settlements according to the prescribed forms and deadlines. If a unit fails to submit on time, in addition to being subject to administrative penalties in the field of accounting and statistics as stipulated, the Ministry of Finance may temporarily suspend or request the State Treasury to temporarily suspend funding until the unit submits its annual settlement report, except for urgent expenditures such as salaries, salary supplements, allowances, scholarships for students, recruitment and discharge expenses.

7. The audit of annual settlement reports of budgetary units under the Ministry of National Defense shall be carried out by the State Audit Agency in accordance with Article 66 of the State Budget Law and Article 78 of Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government.

V. Management of State Assets under the Ministry of National Defense

1. State assets entrusted to the Ministry of National Defense for management and use include:

1.1. Special-purpose assets serving national defense activities, including technical equipment, means of transportation, weapons, military gear, barracks, airports, ports, defensive works, combat works, land used for military purposes, detention facilities, and other types of assets serving national defense operations.

1.2. Assets serving management functions are other types of assets under the management and use of the Ministry of National Defense but not included in the aforementioned categories.

1.3. National reserve assets in the field of national defense managed and preserved by the Ministry of National Defense.

2. Organization of asset management:

2.1. For special-purpose assets serving operational activities in the field of national defense, the Ministry of National Defense is responsible for organizing their management and use in accordance with established regulations and confidentiality principles issued by competent authorities; conducting periodic inventory, evaluation, and reporting to relevant agencies as prescribed by the Government.

2.2. For assets serving management functions, the Ministry of National Defense organizes their management and use in accordance with current State regulations on the management of State assets.

2.3. For reserve assets, they are managed in accordance with current regulations on the preservation of national reserve goods.

2.4. Assets at enterprises under the Ministry of National Defense are managed in accordance with current regulations on asset management in state-owned enterprises.

3. The transfer, conversion, and liquidation of assets under the Ministry of National Defense must be carried out in strict compliance with current State regulations. Unauthorized use of State assets for purposes other than those specified, beyond the prescribed standards and quotas, for personal, business, or other purposes is strictly prohibited, except in cases specially provided for by the Government.

VI. IMPLEMENTATION

1. Regulations on the division of responsibilities for budgetary expenditure items in the field of national defense shall be implemented in accordance with Decree No. 10/2004/NĐ-CP dated January 7, 2004 of the Government, which stipulates the management and use of the State budget and assets for certain activities in the fields of national defense and security.

2. This Circular takes effect from the 2004 fiscal year and replaces Joint Circular No. 91/1998/TTLT-BTC-BQP dated June 29, 1998 of the Ministry of Finance - Ministry of National Defense. Any previous documents and regulations inconsistent with this Circular are no longer in force.

3. Ministries, ministerial-level agencies, government agencies, central-level agencies, People's Committees at all levels, and agencies and units under the Ministry of National Defense are responsible for implementing this Circular. In the course of implementation, if there are difficulties or obstacles, they are requested to promptly reflect them to the Joint Ministry for resolution.

During the implementation process, if there are difficulties or obstacles, they are requested to promptly reflect them to the Joint Ministry for resolution./.