Joint Circular No. 33-TC/UBKHKTNN guides the management of expenditures for scientific research and technological development.

JOINT CIRCULAR

GUIDELINES ON THE MANAGEMENT OF EXPENSES FOR SCIENTIFIC RESEARCH AND TECHNOLOGY ISSUED BY THE MINISTRY OF FINANCE - STATE COMMITTEE FOR SCIENCE AND TECHNOLOGY NO. 33-TC/UBKHKTNN OCTOBER 21, 1975

In recent times, scientific research and technology work has made new progress; the number of scientific research and technology topics has increased, investment funds for the scientific and technological cause have grown continuously, and the management of expenses for scientific research and technology has initially become systematic.

To contribute to improving the management of scientific research and technology plans in order to encourage and promote scientific research and technology, ensuring that scientific research and technology work achieves high efficiency, completes according to plan, and meets the growing needs of the State, the Ministry of Finance and the State Committee for Science and Technology issue this Circular to guide the management of expenses for scientific research and technology.

Part 1:

SOURCES OF FUNDS AND EXPENSES FOR SCIENTIFIC RESEARCH AND TECHNOLOGY

1. For agencies and basic units whose main activities are scientific research and technology, the State budget allocates funds to cover all aspects of their operations. These units use the allocated operational funds to ensure the completion of tasks as stipulated in the plan, including scientific research and technology projects, regardless of which level approves these projects. Expenses allocated to these units are recorded under category 2, item 37, according to the current State budget classification.

2. For state administrative agencies engaged in scientific research and technology work, funds for scientific research and technology are provided by the State budget in two forms:

- Allocated within the operational funds of the unit if it is for scientific research and technology projects managed at the grassroots level; expenses for these projects are recorded in a sub-item within item 14 (according to the current State budget classification) of the operational fund budget.

- Funds for scientific research projects managed at the national and ministry levels are separately allocated by the State budget according to the procedures specified in Part II of this Circular.

3. For enterprises, the capital reserved for scientific and technological research projects managed at the grassroots level is extracted from the production development incentive fund as stipulated in Decree No. 236-CP dated December 10, 1970, Circular No. 88-CP dated March 2, 1972, issued by the Council of Ministers, and Circular No. 14-TC/CNXD dated August 1, 1974, issued by the Ministry of Finance.

For enterprises not implementing the three-fund system, the capital for scientific and technological research projects managed at the grassroots level is budgeted according to the regulations applicable to dedicated funds. If the projects are managed at the ministry and national levels, they are separately allocated by the State budget according to the procedures specified in Part II of this Circular.

Part II:

MANAGEMENT REGULATIONS FOR FUNDS AND EXPENSES FOR SCIENTIFIC RESEARCH AND TECHNOLOGY

I. PRINCIPLES OF MANAGEMENT

1. State budget funds - as well as funds extracted from the production development incentive fund - allocated for scientific research and technology must only be granted and used for projects listed in the unit's work plan after being approved by the competent authority as follows:

a. Each project must have its own research outline. The outline must clearly specify the research content, completion deadline, and estimated expenses for the research.

Projects managed at the national level must have their research outlines reviewed by the State Committee for Science and Technology (content, deadline, and estimated expenses) and submitted to the Council of Ministers for approval.

Projects managed at the ministry level must be reviewed by the relevant ministry (content, deadline, and estimated expenses), with the participation of the State Committee for Science and Technology.

Projects managed at the grassroots level must have their research outlines reviewed by the relevant ministry (content, deadline, and estimated expenses); the list and consolidated budget estimates for these projects, after being reviewed by the relevant ministry, must be registered with the State Committee for Science and Technology.

2. Funds allocated for scientific research and technology must be used for their intended purpose; they cannot be used for any other purposes.

Allocated funds can only be used for projects approved by the competent authority according to the prescribed regulations and included in the unit's work plan; they cannot be used for researching projects outside the approved plan.

Funds allocated for projects managed at any level can only be used for projects at that level; funds for projects managed at the national level cannot be used for projects managed at the ministry or grassroots levels, and vice versa.

Units using allocated funds have the right to adjust the use of such funds within the scope of projects managed at the same level and within the allocated amount, after obtaining the consent of the higher-level management agency.

Management of expenses for scientific research and technology must strictly comply with the State's expense standards, conserve materials, labor, and capital, complete research tasks according to the approved plan with maximum efficiency, and adhere to the budgeting, settlement, and accounting reporting regulations set by the State.

II. MANAGEMENT REGULATIONS FOR EXPENSES FOR SCIENTIFIC RESEARCH AND TECHNOLOGY

A. For units specializing in scientific research and technology receiving operational funds for scientific research under category 2, item 37 of the budget classification.

1. Annual budget preparation

a. The annual budget of scientific research and technology units must:

- Fully and accurately reflect all expenses for the unit's activities in all aspects, particularly direct expenses for scientific research and technology (category 2, item 37, sub-item 14);

- Ensure full compliance with the State's expense standards according to the prescribed regulations.

b. Regarding the content of the budget, attention should be paid to the following two expense items:

Expenditure on salaries and allowances (Items I and II): if it is an entity with an annual quota for staffing approved, then the salary shall be calculated based on the number of employees present at the end of the previous year and must not exceed the approved quota for the planning year.

Direct expenditure for scientific research and technology (Item 14) can only account for the following expenses:

- Expenses for paying wages to external labor forces hired to participate in research projects within the plan;

- Expenses for raw materials, fuels, materials, chemicals, crop seeds, livestock breeds, experimental animals, etc., directly serving the research of projects according to the plan;

- Expenses for purchasing a small number of machines and equipment directly serving the research projects according to the plan; it is prohibited to use this funding to supplement basic construction capital for equipping the unit outside the plan. The agency responsible for reviewing project equipment and budget estimates needs to carefully consider cases requesting the purchase of many machines and equipment; generally, for units that do not have suitable technical facilities, they should not be assigned research projects requiring many pieces of equipment, except in special cases.

c. Direct expenditure for scientific research and technology (Item 14) must clearly specify each expense for each project and distinguish according to the level of project management.

d. The annual budget estimate must be divided into quarters according to the progress of the research work plan; accompanying this comprehensive budget estimate must be research outlines for each project; each project has a detailed outline explaining the research content, time frame, and direct expenses for that project.

The budget is prepared according to the form prescribed by the Ministry of Finance and within the deadline for preparing the state budget according to the prescribed regulations. For projects requiring extended research over several years, the total amount of necessary funds, the amount needed for the planning year, must be clearly stated. For ongoing projects, the total approved funds, the amount settled in previous years, and the amount needed for the planning year must be clearly stated.

e. When submitting the Scientific and Technical Council of the agency to approve the content of research projects, the head of the budget unit requests the Council to approve the direct expenses for each project.

g. The annual budget of the second-level unit must be sent to the first-level budget unit along with the outlines of each project.

The first-level budget unit must:

- Review projects under the management of the ministry and grassroots levels, both in terms of content and budget estimates for each project, then compile them into two lists: one list of all projects managed by grassroots levels submitted to the State Science and Technology Committee for registration, and one list of projects managed by ministries accompanied by research outlines submitted to the State Science and Technology Committee for comments. These documents must be sent to the Ministry of Finance, one copy each.

- Examine projects under national management, provide opinions on each project, both in terms of content and budget estimates, and send the compiled list of projects and research outlines to the State Science and Technology Committee and the Ministry of Finance, one copy each.

2. Approval of the annual budget estimate

The State Science and Technology Committee:

- Review the consolidated list of projects managed by various entities and individual projects managed by ministries, both in terms of content and budget estimates, and provide comments to the managing agencies and inform the financial authorities of the results;

- Coordinate with the Ministry of Finance to review projects under national management in terms of content to be carried out in the planning year as well as budget estimates, examine the appropriateness of each expense item, and then compile a list to submit to the Government Council for approval.

Based on the comments from the State Science and Technology Committee, the Ministry of Finance reviews the consolidated budget estimate for category 2, item 37 of the managing agencies, incorporates it into the annual state budget estimate, and submits it to the Government Council for approval according to the prescribed procedures.

3. Notification of budgeted funding levels

After the list of projects under national management is reviewed by the Government Council, the State Science and Technology Committee prepares a notification for each managing agency. Projects under national management approved by the Government Council are also sent to the financial authority together with the list of projects managed by ministries and grassroots levels that have been approved. This notification must include the approved budget estimate for each project, in addition to the project content.

The Ministry of Finance bases its notification of the budgeted funding level for scientific research and technological development (category 2, item 37) for each managing agency on the approved state budget estimate and the results of the State Science and Technology Committee's review of each project.

The managing agency notifies the approved funding level for scientific research and technological development (category 2, item 37) for each subordinate unit.

4. Application of funding allocation system

Each quarter, the financial authority organizes the allocation of funds based on the comprehensive cost plan of the managing agency to distribute to subordinate units within the total approved annual funding.

The financial authority will allocate funds for the next quarter only after receiving a report on the estimated implementation of the cost plan for the previous quarter (with specific explanations) and the final settlement report for the previous quarter according to the prescribed regulations.

5. Management of expenditures for scientific research at grassroots units

Management of expenditures must be strict, respecting established standards, promoting savings in materials, labor, and capital, and implementing the research plan schedule for each approved project.

If additional funding is required or a change in the use of funding is requested: transferring funds allocated for one project to another project under the same level of management (state, ministry, or grassroots level), the managing unit must report to the higher level with a detailed explanation of the reasons for the adjustment for the higher level to decide.

In cases where research topics are not proceeding smoothly and do not hold promise for yielding results, the managing unit must promptly seek opinions from the Scientific Council; cease the research, review the status of completed research work, the amount of funds already utilized (mainly under item 14), and report to the higher-level management unit to inform the financial authority to halt fund disbursement and notify the State Committee on Science and Technology for monitoring.

6. Final settlement report

1. Quarterly and annual final settlement reports must be prepared in accordance with established regulations. The final settlement report must include an explanatory note detailing:

- Achievements made in the research topic (extracted from the Scientific Council's evaluation of the research topic results);

- The effectiveness of the research;

- Costs incurred for the research topic.

The final settlement report must be prepared according to the prescribed format and within the time limit stipulated in the accounting system of the budgetary unit: Circular No. 3-TC/TDT dated March 30, 1972, form number 9-BC (quarterly final settlement report) and form number 32-BC (annual final settlement report).

2. The final settlement report of the basic unit must be submitted to the higher-level managing authority. The higher-level managing authority (first-level budgetary unit) must submit a consolidated final settlement report to the financial authority at the same level (simultaneously sending one copy to the State Committee on Science and Technology for information).

7. Inventory and year-end settlement

At year-end, the basic unit must organize an inventory in accordance with established regulations.

Fixed assets, machinery, and equipment purchased during the plan year using research science funds (item 14) must be inventoried, their current condition and remaining value determined, and transferred to become fixed assets of the unit and managed accordingly. Assets that are no longer needed should be reported to the financial authority and the State Committee on Science and Technology for reallocation to other units.

Raw materials in stock at year-end, if they are to be continued to be used in the following year, should be carried over to the next year; those no longer needed should be reported to the financial authority for reallocation to other units according to regulations.

At year-end, any unused portion of the funds allocated during the plan year must be returned to the state budget; if it is surplus cash not needed, it should be recorded as a refund to restore the budget limit to reduce future allocations. If it is advance payment for ongoing research projects that need to continue in the following year to complete the project, procedures should be followed to transfer it to the next year for use. Advance payments for completed projects must be settled promptly; any surplus must be returned to the state budget (recorded as a refund to restore the budget limit).

8. Revenue from selling research products, trial products, or experimental animals

The annual budget must estimate revenue from selling research products, trial products, and experimental animals for each project.

During the course of work, any revenue obtained must be immediately deposited into the state budget (reducing expenses); the unit may not retain it for expenditure.

B. For state administrative agencies engaged in scientific research

1. Basic units under state administrative agencies engaged in scientific research can use two sources of funding for this purpose:

- Allocate operating funds (item 14) according to the approved budget to meet the needs of expenditures for projects managed at the grassroots level; these research science funds are settled together with the operating funds provided to the unit.

- Special funds allocated for projects managed by the state and ministry levels: these funds are distributed by the managing authority (higher-level managing unit) based on the financial agency's plan, taking into account the State Committee on Science and Technology's recommendations. These funds are outside the operating funds of the grassroots budgetary unit; the grassroots unit must settle separately regarding these funds with the higher-level managing unit, which will then consolidate and settle with the financial authority.

2. State administrative agencies preparing operating budgets must allocate funds for research and technology projects managed at the grassroots level. This budget must include detailed explanations for each project (content and estimated expenditures) as specified in Part II, Point 2 of this Circular.

For projects managed by the ministry and state levels, the unit must prepare separate explanations for each project; the explanation must clearly detail the research topic content, implementation organization, and estimated expenditures as specified in Part II, Point 2 of this Circular.

The operating budget and list of research projects managed by the ministry and state levels, along with the explanations, must be submitted to the higher-level managing unit within the prescribed timeframe.

3. Regarding the management and use of funds, state administrative agencies must strictly adhere to the principle of not using funds allocated for research projects managed by the ministry and state levels for projects managed at the grassroots level; research science funds must be used for their intended purposes and not diverted to other uses, as stipulated in Point 3, Section I, Part II of this Circular.

C. For enterprises using funds extracted from production development reserves for scientific research

Enterprises must comply with the provisions of this Circular in managing research science funds:

- They must prepare a research science plan for the unit, specifying each project, with an explanation for each project, approved by the competent authority as stipulated in Part II of this Circular (projects managed by the state must be approved by the State Committee on Science and Technology);

- Funds extracted from production development reserves can be used for projects managed at the grassroots level;

- For projects managed by the state and ministry levels, separate estimates with explanations must be prepared and reported to the managing authority for consideration of special funding allocation and separate settlement as stipulated in Part II of this Circular.

If there is a need to sell trial products, the proceeds will be credited to the enterprise's production development reserve fund.

D. In the case of signing a scientific research and technology contract with an external unit

Shall not use state budget funds or draw from production development incentive funds (money, materials, raw materials) to cover expenses for research projects contracted with external parties.

Shall maintain separate ledgers, recording each item of income and expenditure clearly.

Upon completion of the research, if there is a surplus due to the difference between income and expenditure, it shall be handled according to the provisions of Circular No. 1-TT/LB dated April 2, 1975, guiding financial management for production labor in universities and vocational schools.

This Circular takes effect from October 1, 1975, for all units engaged in scientific research under the management of central and local sectors.

Any previous regulations contrary to this Circular are hereby abolished.