Joint Circular No. 34-TC-GTBĐ guiding the profit distribution regime for postal business operations according to Decision No. 146-HĐBT dated August 25, 1982 of the Council of Ministers.

JOINT CIRCULAR

Guidelines for Implementing Profit Distribution Regimes for Postal Business Operations Pursuant to Decision No. 146-HĐBT dated August 25, 1982 of the Council of Ministers

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On August 25, 1982, the Council of Ministers issued Decision No. 146/HĐBT on amending and supplementing Decision No. 25/CP. The Ministry of Finance issued Circular No. 21/TC-CNA dated September 1, 1982 guiding cost accounting, determining state revenue levels, implementing profit distribution regimes, and establishing enterprise funds in production and business sectors according to the aforementioned amended decision. To unify the implementation of profit distribution regimes and establishment of enterprise funds for postal business operations (hereinafter referred to as postal business operations), apart from general provisions on production cost accounting, product costs, profit distribution, and establishment of enterprise funds, the Ministry of Finance and Posts jointly provide additional guidelines as follows:

I-DETERMINATION OF PLANS FOR POSTAL BUSINESS OPERATIONS

Due to the main economic and technical characteristics of the Posts sector, materials used by the sector, whether supplied by the State according to plans or self-exploited by other agencies and enterprises, are all under unified State management. Therefore, postal business operations only have one main production plan.

II-PLAN INDICATORS:

1/ Revenue of postal business operations.

Revenue of postal business operations is the income from postal fees and other revenues during the process of fulfilling tasks to ensure postal information and newspaper distribution.

Postal business operation revenue includes:

a. Income from postal fees.

Stamp sale revenue

Parcel service fee revenue

Package service fee revenue

Money transfer service fee revenue

Telegraph service fee revenue

Telephone service fee revenue

Rural subscription fee revenue

Mailbox rental fee revenue

Military mail bag service fee revenue

Telegraph report rental fee revenue

Telephone report rental fee revenue

Telex report rental fee revenue

Telephone switch rental fee revenue

New subscriber line construction fee revenue (management fee portion)

Transit fee revenue

b. Revenue from newspaper distribution:

- Central newspaper distribution revenue

Provincial newspaper distribution revenue

Foreign language newspaper distribution revenue

c. Other revenue:

Envelope, postcard, and picture card sales revenue

Stamp sales revenue

2/ Main product volume:

Number of parcels

Number of newspapers distributed by posts

Number of telegraph messages (including Telex)

Long-distance call units

Intra-city leased telephone units (with postage stamps)

3/ Profit from postal business operations.

Profit from postal business operations is the difference between postal business operation revenue and postal business operation expenses. Postal business operation profit is determined within the entire industry, calculated using the formula:

Total postal revenue and total postal expenses of the entire industry include the revenue and expenses of all provincial, city, special zone post offices, and other units such as telecommunications centers, transportation, newspaper distribution, etc., belonging to the postal business operations sector.

III- DISTRIBUTION OF PROFITS, AND ESTABLISHMENT OF ENTERPRISE FUNDS

1/ Case of completing the plan.

If the General Post Office completes the legal plan indicators of the State plan, the General Post Office will extract profits to establish a production development fund according to the current regime and set up two welfare and reward funds at 24% of the total wage bill implemented throughout the year of production and business staff (including living expenses of village post office staff), excluding unreasonable expenditures in the wage fund such as defective product wages, excess downtime wages beyond permitted limits, and other wage expenditures contrary to wage policies.

Any remaining profit if the General Post Office does not need to supplement the approved working capital quota for postal business operations must be fully remitted to the State Budget.

The ratio of distribution between the two reward and welfare funds is: 70% for the reward fund and 30% for the welfare fund.

2/ Case of failing to complete the plan.

If the General Post Office fails to complete three legal plan indicators regarding postal business operations as follows, for each percentage point (%) not completed in any indicator, 2% of the amount extracted according to the basic extraction rate of each fund will be deducted:

- Postal business operation revenue

- Main product volume according to specified quality standards.

- Profit and other budget payments.

a. Postal business operation revenue includes items as described above (in Section 2, Article 1).

b. Main product volume includes products as mentioned above (in Section 2, Article 2).

c. Profit and other budget payments include:

- Profit payable.

- Basic depreciation payable.

- Other budget payments (such as excess capital recovery, public services, etc.).

To analyze and determine the degree of completion of the three aforementioned plan indicators, it is necessary to base on statistical production and consumption reports. When determining the degree of completion of the main product volume indicator, the principle of not offsetting over-plan products against under-plan products must be ensured.

Example:

The newspaper distribution target partly depends on the number of publications controlled by the Central Propaganda Department, so when determining the degree of plan completion, objective reasons will be considered appropriately.

The telegraph target includes Telex, so when assessing the degree of plan completion, Telex should be converted to telegraph according to the conversion method used for calculating Telex fees.

3/ Deduction due to violation of regulations and policies.

Apart from deductions due to non-completion of the three aforementioned legal plan indicators, if the postal business operations sector violates any of the following conditions, deductions ranging from 2 to 5% of the amount extracted for each fund will be made depending on the extent of the violation:

- Loss, error, confusion, misplacement of postal items, telegrams, newspapers, and damage to State property, materials, and capital;

- Violation of economic contract regulations, accounting and statistical reporting, pricing policies, and financial discipline;

- Occurrence of fatal accidents due to management deficiencies or lack of responsibility;

4/ Case of exceeding profit targets:

If the postal business unit achieves profit exceeding the plan, sixty percent of the excess profit will be allocated to enterprise funds, while forty percent will be paid into the State Budget.

When determining the excess profit, it is necessary to exclude profits increased due to objective factors and only consider those increased through subjective efforts.

If the profit plan is completed or exceeded but other payments to the State Budget are not met, the excess profit must be used to offset the shortfall in other payments to the State Budget. The remaining profit after offsetting is the amount to be considered for the implementation of the profit payment plan.

If the profit payment plan is not completed, but other payments to the State Budget exceed the plan, such excess payments cannot be used to offset the shortfall in the profit payment plan.

In cases where actual profit does not meet the plan but profit payments to the State Budget achieve or exceed the plan, this shall not be recognized as completion or overachievement of the plan because it would involve utilizing other sources of funds to pay the State Budget.

Example: Calculation of bonus allocation for exceeding the plan:

 

Assuming that out of the 5 million dong profit exceeding the plan (35,000,000 - 30,000,000), 1 million is due to the State's increase in postage rates, and the remaining 4 million is due to the postal industry's efforts to improve labor productivity and reduce production costs, the allocation of the excess profit to enterprise funds is as follows:

- Excess profit is: (35,000,000 - 30,000,000) - 1,000,000 = 4,000,000

- Profit allocated to enterprise funds is: 4,000,000 x 60% = 2,400,000.

- Profit to be paid to the State Budget is: 4,000,000 x 40% = 1,600,000.

The General Post Office has actually paid 13,000,000 dong to the State Budget, including 10,000,000 from planned profit, 1,000,000 from increased postage rates, and the remaining 400,000 from excess profit. However, due to a shortfall in other payments of 200,000 (5,000,000 - 4,800,000), the actual excess profit paid is only 200,000 (400,000 - 200,000). In this case, the maximum allocation to enterprise funds is 2,400,000 based on the actual profit achieved. The excess profit paid to the State Budget of 200,000 will either be refunded or deducted from the profit payable next year.

The allocation of the profit from exceeding the plan to enterprise funds is distributed as follows:

+ 60% for the incentive fund

+ 20% to the welfare fund

+ 20% for the production development incentive fund.

IV-LIMIT OF THE TWO FUNDS FOR REWARD AND WELFARE.

If the reward and welfare fund derived from the profit achieved and exceeded the plan throughout the year exceeds six months' average salary of production and business staff in the postal business unit, the excess amount (from the seventh month onwards) will be distributed as follows:

- 50% to be paid into the State Budget.

- 20% to establish the financial reserve fund of the industry.

- 30% to supplement enterprise funds. This portion is allocated as follows:

                    - 60% for the reward fund

                    - 20% for the welfare fund

                    - 20% for the production development fund.

If the entire postal business unit fails to complete the plan and the deduction from the reward and welfare funds is too much, resulting in an average per capita level below 60% for both funds combined, then the State Budget will provide subsidies to reach the average level. The allocation of 60% into the reward and welfare funds is determined by the enterprise director.

V-ORGANIZATION TO REVIEW COMPLETION OF PLAN AND ALLOCATION OF ENTERPRISE FUNDS

To ensure objectivity, the organization to review the completion of the State plan for the postal business unit must be agreed upon by financial, statistical, planning agencies, and the bank at the same level.

When reviewing the completion of the plan for the postal business unit, the General Post Office is responsible for reporting the implementation of State plan indicators, creating conditions for these agencies to understand the actual implementation of the plan and accurately assess the results of the postal business unit. The review result is recorded in a protocol. If any of the agencies disagree with the protocol, the General Post Office must report to the Chairman of the Government Council for guidance. If all agencies agree, the General Post Office will work with the Ministry of Finance regarding the procedures for allocating enterprise funds according to current regulations.

The review of plan completion and allocation of enterprise funds for provincial, city, special zone post offices, telecommunications centers, transportation, newspaper distribution, computer centers... under the General Post Office will be separately guided by the General Post Office (ensuring the total allocation of enterprise funds for provincial, city, special zone post offices, centers... does not exceed the total allocation of enterprise funds for the entire postal business unit).

To promptly enhance the effectiveness of bonuses, the General Post Office needs to organize quarterly allocations (ensuring no more than 75% of the total allocation) with local financial agency supervision.

VI-IMPLEMENTING PROVISIONS

1/ This Circular applies only to the allocation of enterprise funds for the postal business unit.

2/ This Circular takes effect from the date of issuance and is applied to the distribution of profits and allocation of enterprise funds for the postal business unit in 1982. All previous regulations contrary to this Circular are abolished./.