Circular No. 27 TC/CĐKT guiding the implementation of Decision No. 212 TC/CĐKT dated December 15, 1989 of the Ministry of Finance on accounting work for the lottery industry

CIRCULAR

OF THE MINISTRY OF FINANCE NUMBER 38-TC/CĐTC ON MAY 11, 1993
GUIDELINES FOR IMPLEMENTING THE FINANCIAL MANAGEMENT REGIME FOR
LOTTERY CONSTRUCTION COMPANIES

Implementing Decree No. 15/CP dated March 2, 1993 of the Government on "tasks, powers, and responsibilities for state management of ministries and agencies at the ministerial level," Decree No. 155/HĐBT dated October 15, 1988 of the Council of Ministers on "functions, tasks, and organizational structure of the Ministry of Finance," and the Revenue Tax Law and Corporate Income Tax Law enacted pursuant to Resolution No. 351/HĐBT and Decree No. 353/HĐBT dated October 2, 1990 of the Council of Ministers detailing the implementation of tax laws;

Pursuant to the Accounting and Statistics Ordinance issued by the State Council on May 20, 1988 and Decree No. 25/HĐBT dated March 18, 1989 of the Council of Ministers promulgating the Regulations on Organizational Accounting of State Agencies;

The Ministry of Finance provides guidelines for implementing a uniform financial management system applicable to all Lottery Companies nationwide as follows:

II- SUPPORT MEASURES FOR STATE-OWNED AGRICULTURAL FARMS AND FORESTRY COMPANIES IN THE FIELD OF SCIENCE AND TECHNOLOGY

1. Lottery Company (XSKT) is a state-owned enterprise operating under general state regulations.

2. Lottery Construction Companies are independent accounting units, have legal personality, are provided with statutory capital by the State, have financial autonomy, are responsible for material results of business operations, ensuring the preservation and development of capital, and are responsible for fully fulfilling their obligations to pay the State budget according to the law.

3. Lottery Company (XSKT) implements state financial systems, common regulations for state-owned enterprises, and specific guidelines set forth in this Circular.

II- SOME SPECIFIC PROVISIONS

1. State Capital and Responsibility for Preservation:

a) State capital allocated for use and preservation by Lottery Companies:

- State budget capital includes: fixed capital, circulating capital, basic construction capital, and other sources of capital provided by the budget or originating from the State budget (such as price differences for goods and materials and amounts payable to the budget but retained by the budget).

- Self-supplemented capital includes: fixed capital, circulating capital, basic construction capital formed from retained profits and business development funds.

b) Responsibilities for preservation and development of capital:

- All State budget capital and self-supplemented capital from after the capital transfer point must be combined into the current capital of the Company and must be preserved.

- The Company has autonomy in the use, replacement, and modernization of fixed assets as stipulated currently for state-owned enterprises.

- Annually, the Lottery Construction Company reports to the supervising authority to verify and re-determine the amount of capital that the Company must preserve as of December 31, with the preserved capital of the reporting year serving as the basis for checking the degree of preservation for the following year. The determination of the degree of preservation and development of current capital of Lottery Construction Companies is carried out according to the documents of the Ministry of Finance guiding the implementation of the regime for preserving and developing capital for state-owned enterprises.

2. Revenue of Lottery Companies:

- Revenue from selling lottery tickets.

- Ancillary business revenue.

- Other financial service revenues.

3. Expenditures of Lottery Companies:

a) Payment for prize-winning tickets not exceeding 50% of ticket sales revenue.

b) Issuance expenses:

- Commissions paid to agents are implemented according to the current regulations of the State and guidance documents of the Ministry of Finance, specifically for plains provinces and cities up to a maximum of 13%, mountainous provinces and the Central Highlands up to a maximum of 15% of ticket sales revenue.

- Costs for printing lottery tickets.

- Costs for publicity, advertising, and announcing draw results.

- Costs for conducting draws.

- Transportation costs.

- Wages:

Based on the State's decision regarding wage scales applicable to state-owned enterprises, the unit calculates the wage rate according to the guidelines and submits it to the competent authority for approval. Wage payments are made based on business performance results.

- Payments for social insurance and health insurance.

- Costs for labor protection equipment for those entitled to such equipment according to the State's decision.

- Travel expenses according to State regulations.

- Depreciation of fixed assets as stipulated in Decision No. 507-TC/ĐTXD dated July 22, 1986 and other guidance documents of the Ministry of Finance.

- Costs for regular maintenance of fixed assets.

- Costs for necessary tools for business operations.

- Administrative management costs.

- Costs for preserving and developing capital.

- Other reasonable costs arising from business requirements.

- Ancillary business costs (if any).

Lottery Construction Companies must fully, accurately, and in accordance with the prescribed regime account for all expenditure items. Total issuance costs (including agent commissions) of the Company shall not exceed 18% of ticket sales revenue for plains provinces and cities, and not more than 22% for companies in mountainous and Central Highland provinces.

Encouraging companies to save on issuance costs below the aforementioned limit. Quarterly (after having paid corporate income tax according to current regulations), Lottery Construction Companies may use the saved issuance costs to supplement the business development fund.

4. Agent credit period: Implement the provisions of the Ministry of Finance, agent collateral must ensure at least 70% of the allowed credit period.

5. Obligation to pay the State Budget of Lottery Companies:

The Company must comply strictly with the laws on corporate income tax, revenue tax, usage of State budget capital, real estate tax, and business license tax. Additionally, the Company must also pay depreciation of fixed assets, State budget capital, and other required payments according to the prescribed regime of the State.

6. Profit distribution and establishment of funds:

a) Retained profit of Lottery Companies is determined as follows:

b) Retained profit is distributed as follows:

Establishment of three funds:

Amount of retained profit (after deducting any fines if applicable)

The company establishes three funds (business development fund, reward fund, welfare fund) in accordance with current state regulations and the guidelines in this Circular.

c) Use of the three funds:

+ The bonus and welfare fund operates according to the current regime of the State like other enterprises.

+ Business Development Fund:

- Constructing, renovating, and expanding workplaces.

- Supplementing circulating capital as needed for lottery activities approved by the supervising authority.

- Purchasing equipment such as number drawing machines, communication devices, computers for management and financial operations, and other necessary equipment.

- In case of unexpected events such as fire or natural disasters, the Lottery Construction Company reports to the supervising authority and relevant authorities to conduct inspections and determine losses in writing. If the loss is under 50 million dong, the unit prepares a settlement report and submits it to the supervising authority for approval; if the loss exceeds 50 million dong, it is submitted to the provincial People's Committee for approval, and the company can use the business development fund to cover the approved loss.

- Training and improving the professional skills of staff.

- Strictly prohibiting the use of the business development fund for bonuses and welfare purposes.

For Lottery Construction Companies that have made significant efforts but face many difficulties in lottery operations, after paying corporate income tax, if there is no profit left to establish the three funds or if the remaining amount is very small, the Company reports to the Department of Finance and Price Control and the provincial People's Committee for consideration, and they may allocate a portion from the local budget to support the Company, with the allocation amount decided by the provincial People's Committee to ensure harmony among enterprises in the province.

For newly established Lottery Construction Companies without adequate facilities or facing significant facility challenges, the Company reports to the Department of Finance and the provincial People's Committee to seek initial assistance measures to ensure these Companies have conditions for development.

III- REGIME FOR ESTABLISHING AND REPORTING IMPLEMENTATION
FINANCIAL PLAN

The Company XSKT shall submit reports on plans and implementation of plans in accordance with the Accounting and Statistics Ordinance of the State; the provisions of Circular guiding number 27-TC/CĐKT dated July 17, 1990, and subsequent regulations of the Ministry of Finance.

Quarterly, no later than the 15th to 20th day of the first month of each quarter, the company shall submit a report on the implementation of the previous quarter's plan to the Ministry of Finance.

The annual final account report must be completed and approved by the supervising authority and submitted to the Ministry of Finance no later than March 31 of the following year.

The annual final account must fully and clearly reflect the financial results of the year, while also reflecting the situation of fulfilling the obligation to pay state budget according to the law.

The annual financial settlement report includes reports on the implementation of approved financial plans, accompanied by reports on the actual situation of the enterprise and the balance sheet of changes, as well as the summary balance sheet of assets of the Company.

VI- IMPLEMENTATION

- The Company XSKT is responsible under the law for the effective use of state assets and capital, the preservation and development of capital, and the fulfillment of obligations to pay taxes to the state budget as prescribed by law.

- The company is subject to inspection and audit by state financial agencies in accordance with tax laws, the Accounting and Statistics Ordinance, and the Inspection Ordinance.

- This Circular takes effect from the date of signature. Previous provisions that conflict with this Circular are hereby abolished.

In the course of implementation, if there are difficulties, they should be reported to the Ministry of Finance for timely review and amendment.