Joint Circular No. 25/2003/TTLT/BKHCN-BTC supplements certain provisions of Joint Circular No. 2341/2000/TTLT/BKHCNMT-BTC dated November 28, 2000 guiding the implementation of Decree No. 119/1999/NĐ-CP on some policies and financial mechanisms to encourage enterprises to invest in scientific and technological activities.

JOINT CIRCULAR

JOINT CIRCULAR NO. 25/2003/TTLT-BKHCN-BTC OF THE MINISTRY OF SCIENCE AND TECHNOLOGY AND THE MINISTRY OF FINANCE ON AUGUST 25, 2003 REGARDING THE SUPPLEMENTATION OF CERTAIN PROVISIONS IN JOINT CIRCULAR NO. 2341/2000/TTLT-BKHCNMT-BTC OF NOVEMBER 28, 2000 GUIDING THE IMPLEMENTATION OF DECREE NO.

Pursuant to Decree No. 119/1999/ND-CP dated September 18, 1999 of the Government on certain policies and financial mechanisms to incentivize enterprises to invest in scientific and technological activities, the Ministry of Science, Technology and Environment (now the Ministry of Science and Technology) and the Ministry of Finance issued Joint Circular No. 2341/2000/TTLT-BKHCNMT-BTC dated November 28, 2000 to guide implementation.
To unify financial management work for funding research and development projects that create new technologies in priority industries and fields as stipulated in Clause 2, Article 8 of Decree No. 119/1999/ND-CP, the Ministry of Science and Technology and the Ministry of Finance hereby provide additional guidance as follows:

I- CONTENT OF EXPENSES:

1- State budget funds supporting enterprises to implement research and development projects that create new technologies shall be allocated for the following purposes:

- Expenses for scientific research activities.

- Purchase of technical literature and technology secrets for research purposes.

- Analysis of samples and evaluation of quality indicators of research products.

- Purchase of essential materials and raw materials for research.

- Purchase or rental of equipment directly serving research.

- International cooperation directly serving research content.

- Acceptance and evaluation of research results.

- Other expenses directly serving research activities.

2- In cases where a single task uses two sources of funds (state budget support and enterprise capital), it must clearly record the amount from each source in accounting vouchers and ledgers.

3- State budget support funds shall not be used for depreciation of fixed assets, maintenance and construction of facilities, or project management costs.

II- ESTABLISHMENT, DECISION, ALLOCATION OF STATE BUDGET PROJECTIONS:

1- Annually, based on the need for research and development funding of enterprises to implement projects included in the list of encouraged projects selected through the Appraisal Council (including ongoing and new projects), the Ministry of Science and Technology will prepare a budget projection and propose a plan for allocating support funds to each enterprise to submit to the Ministry of Finance for consolidation and submission to the competent authority for decision-making according to the procedures, contents, timeframes, and formats prescribed by the State Budget Law.

2- Based on the budget projection and allocation plan for state budget support for research and development of enterprises in the planning year, which has been decided by the competent authority, the Ministry of Finance will allocate the total amount of research and development support funds to the Ministry of Science and Technology, detailing the amount for each enterprise.

III- COMPLIANCE WITH THE STATE BUDGET:

1- On the basis of the allocated total amount and the support fund for each enterprise, the Ministry of Science and Technology will sign a science and technology contract with each enterprise (for new projects to be implemented in the year).

2- Based on the state support fund, the research content according to the signed science and technology contract with the Ministry of Science and Technology, and the progress of implementing the project, the enterprise will prepare a budget to send to the Ministry of Finance according to the expenditure items and sub-items: Personal payment expenses, professional activity expenses, procurement and repair expenses, other expenses; simultaneously sending to the Ministry of Science and Technology for monitoring and management. The Ministry of Finance will review and inspect; if the conditions for payment are met, it will directly pay the enterprises through payment orders according to the following chapters, types, items, and sub-items:

- Chapter: Corresponding to each enterprise.

- Type: 11 "Scientific Research Activities".

- Item: 01 "Basic, Application and Development of Natural Sciences Research".

- Sub-item: Corresponding to the expenditure items.

For the year 2003: Enterprises will prepare budgets according to expenditure items and sub-items as currently prescribed and send them to the Ministry of Finance for issuance of payment orders, simultaneously sending to the Ministry of Science and Technology for monitoring and management.

3- To continue providing funding for research and development projects of enterprises that have been carried out for two years or more, from subsequent years, enterprises must submit the following documents to the Ministry of Science and Technology and the Ministry of Finance:

- Report on the implementation status and achievements according to the model (Annex 3 - periodic report on the implementation of research and development projects) prescribed in Joint Circular No. 2341/2000/TTLT-BKHCNMT-BTC dated November 28, 2000 of the Ministry of Science, Technology and Environment and the Ministry of Finance.

- Report on the use of funds or final account report of the previous year (if the deadline for finalization has arrived), including both state budget funds and enterprise funds participating in the project.

- Inspection report on the implementation status of the previous year by state management agencies.

- Letter requesting continued funding.

IV- INSPECTION AND FINAL ACCOUNTING WORK:

1- For enterprises:

Enterprises receiving state funding must organize accounting in accordance with current regulations of the State. Expenditures for project implementation must be recorded specifically and clearly. The enterprise's General Director and Project Leader are responsible for using state support funds for their intended purpose, in accordance with regulations, and for truthful and accurate final accounting. If an enterprise misuses state budget funds, fails to comply with regulations, or does not ensure sufficient capital as committed in the contract, the Ministry of Science and Technology and the Ministry of Finance will stop funding and recover previously provided support funds.

Enterprises are responsible for submitting annual final accounts reports to the Ministry of Science and Technology and the Ministry of Finance, including:

- Report on the total funds actually implemented for the project (enterprise capital, budget funding).

- Comprehensive and detailed report on the portion of state budget funds supporting enterprises to conduct scientific research (the final account report form according to Decision No. 999 TC/QD/CĐKT dated November 2, 1996 of the Minister of Finance), with detailed explanations according to the content of expenses and the state budget classification.

2- For management agencies:

- The Ministry of Science and Technology shall coordinate with relevant agencies to inspect the implementation of the project in terms of content and progress, the use of state budget funds, and the mobilization of enterprise capital as committed in the contract; review and approve the annual settlement (portion of state budget funds) of the enterprise, compile and submit to the Ministry of Finance for annual settlement, including: Report on the total funds actually implemented for the project (enterprise capital, budget funding), comprehensive and detailed report on the portion of state budget funds supporting enterprises to conduct scientific research, with explanations and analysis of the effectiveness of using state budget support funds, clearly stating achievements and issues needing resolution.

- The Ministry of Finance is responsible for reviewing and providing comments on the annual settlement of state budget funds supporting enterprises to conduct scientific research to the Ministry of Science and Technology.

V- IMPLEMENTATION PROVISIONS:

This Circular takes effect fifteen days from the date of publication in the Official Gazette. Any difficulties encountered during implementation should be reported to the Ministry of Finance and the Ministry of Science and Technology for consideration and resolution.