Joint Circular No. 44/2000/TTLB guiding the financial management regime for non-state units operating in the field of education and training.

JOINT CIRCULAR

Guidelines on Financial Management for Non-Public Educational and Training Units Operating in the Field of Education and Training

- Pursuant to Resolution No. 90/CP dated August 21, 1997 of the Government on the orientation and policy for socialization of educational activities, healthcare, culture;

- Pursuant to Decree No. 73/1999/NĐ-CP dated August 19, 1999 of the Government on policies to encourage socialization in educational, healthcare, cultural, and sports activities.

To unify financial management work for non-public educational and training units; the Ministry of Finance, the Ministry of Education and Training, and the Ministry of Labour, Invalids and Social Affairs jointly issue the following guidelines on financial management:

I. GENERAL PROVISIONS

1. Non-public educational and training establishments established and operating to implement the policy of socialization are semi-public, private, and private schools within the national education system.

2. Non-public educational and training establishments operate without the aim of commercialization, managing finances under the mechanism of self-financing public service units, covering their operational costs. During operation, if there is a surplus of income over expenses, the establishment may increase investment in infrastructure, improve teaching quality, and allocate funds for incentive and welfare programs to enhance the material and spiritual life of employees.

3. Non-public educational and training establishments must organize financial management, asset management, and accounting in accordance with regulations set by the State, subject to inspection and supervision by competent state agencies, and have the right to open accounts at the State Treasury or commercial banks for transactions.

4. Non-public educational and training establishments shall apply preferential policies for those implementing socialization according to Circular No. 18/2000/TT-BTC dated March 1, 2000 of the Ministry of Finance "Guidelines on Certain Provisions of Decree No. 73/1999/NĐ-CP of the Government dated August 19, 1999 on Financial System Encouraging Non-Public Establishments in the Fields of Education, Healthcare, Culture, and Sports".

II/ SPECIFIC PROVISIONS

A - Applicability:

1- The applicability of this Circular includes non-public educational and training establishments at all levels within the national education system, including:

- Kindergartens, groups of children;

- Preschool classes;

- Combined preschool centers (combining kindergartens and preschool classes);

- Primary schools;

- Junior high schools;

- High schools;

- Comprehensive Technical Centers; Cultural Development Centers; Foreign Language Centers; Computer Centers; Continuing Education Centers; Supplementary Education Schools;

- Vocational Training Centers (vocational schools, vocational training centers, vocational classes); Professional Secondary Schools;

- Colleges;

- Universities;

2- Non-public establishments operating under three types:

a- Semi-public educational and training establishments:

- Semi-public educational and training establishments are established based on collaboration between state educational and training establishments and non-state organizations, enterprises, and individuals from various economic sectors in the country through methods such as new establishment, transferring all or part of the physical assets from public units for joint investment in building physical assets, managing, and operating the establishment according to legal provisions.

b- Private educational and training establishments: These are establishments founded by non-state organizations and collectives, jointly investing in building physical assets, and participating in management and operation according to legal provisions.

dong at the Trading Department's operational fund in accordance with established regulations. Private educational and training establishments: These are establishments established and managed by individuals or households according to legal provisions.

B - Sources of funding and contents of revenue and expenditure for non-public educational and training establishments:

1- Sources of funding:

- State budget:

+ Initial value of physical assets and new investments during operation for semi-public establishments;

+ Amounts remitted to the state budget that are returned;

+ Funding for implementing state-level programs and projects (if applicable);

- Supplement from annual financial results;

- Donations, grants, support, and gifts from organizations and individuals both domestically and internationally;

- Capital contributions from organizations and individuals for new construction, renovation, expansion, and upgrading of physical assets;

- Loans from banks and credit institutions (if applicable);

2- Contents of revenue and expenditure:

a- Revenue contents:

- Tuition fees of students and trainees:

For centrally-managed schools, the revenue framework is guided by the Joint Circular of the Ministry of Finance, the Ministry of Education and Training, and the Ministry of Labour, Invalids and Social Affairs.

For locally-managed schools, the level of revenue is guided by the People's Committees of provinces and centrally-administered cities in accordance with local socio-economic conditions.

- Revenue from training service contracts, vocational training, scientific research, and technology application;

- Interest from bank deposits and the State Treasury (if applicable);

- Revenue from production labor, joint ventures, and cooperative operations;

- Other lawful revenues (if any).

b- Expenditure contents:

- Salaries, wages, bonuses, and contributions according to prescribed regulations such as social insurance, health insurance, and trade union fees for employees;

- Expenditures for students and trainees: scholarships, awards, and implementation of social policies for students and trainees under policy categories;

- Fees for lecturers, researchers, and visiting lecturers;

- Costs for teaching, learning, training, vocational training, scientific research, and technology application to serve teaching and learning;

- Costs for improving the qualifications of teachers and staff of the establishment;

- Official duties fees, conference fees, travel expenses, communication expenses, etc.;

- Rent payments for physical assets (if applicable), costs for purchasing and constructing fixed assets, equipment, and teaching materials;

- Depreciation of fixed assets;

- Costs for fulfilling tax obligations to the state (if applicable);

- Loan interest payments and capital contribution returns;

- Other expenditures (if applicable);

C-Financial Management System:

1- For semi-public educational and training establishments:

a- Management and use of capital and assets:

- The financial management process for semi-public Education and Training units shall be carried out according to the principle of clearly distinguishing and publicly disclosing state budget investment sources and sources of funds raised outside the state budget.

- State capital contributions include monetary capital, materials, goods, fixed assets (buildings, land, machinery, equipment, transportation means, other assets...) initially provided by the state and transferred during the operation period. Educational and training institutions organize an inventory and assessment of the entire state capital contribution, submit it to the competent authority for review, and then send it to the same-level financial agency to handle the transfer procedures of state assets and capital to semi-public educational institutions in accordance with Circular No. 43/TC-QLCS dated July 31, 1996 issued by the Ministry of Finance.

Each year, semi-public institutions organize a revaluation of their asset value and report to the same-level financial agency, including a detailed analysis of assets retained from state capital contributions.

Assets that are not needed or are technologically obsolete may be sold to recover capital and supplement the financial resources for the institution's activities. Prior to sale, the institution must establish a valuation committee and conduct public auctions in accordance with legal regulations.

- State budget funds allocated for implementing programs, topics, and projects shall be managed and utilized according to the approval of the competent authority. Quarterly progress reports on implementation and income and expenditure statements shall be submitted to the approving agency.

- Capital contributions from non-state organizations and individuals from all economic sectors, as well as borrowed capital, shall be managed and utilized for their intended purposes in accordance with approved projects.

- Depreciation of fixed assets left to the unit shall strengthen its material basis. In necessary cases, the head of the semi-public institution may stipulate a higher depreciation rate to recover capital, but it must be consistent with the service users' payment capacity.

b - Semi-public Education and Training institutions shall apply the revenue and expenditure management system of public institutions. Annually, semi-public Education and Training institutions prepare budgets for revenues and expenditures based on their sources of formation; after being approved by the Board of Management,

they shall submit them to the superior management agency for consolidation and submission to the same-level financial agency.

c - Semi-public Education and Training institutions shall implement accounting systems in accordance with Decision No. 999/TC-QĐ-CĐKT dated November 2, 1996 issued by the Ministry of Finance establishing the administrative and public service accounting system.

d - Semi-public Education and Training institutions shall regularly or suddenly inspect and audit the use of funds within the institution; disclose all income and expenditure items and income distribution payments to employees within the institution; and report changes in assets according to state capital contributions and funds raised outside the state budget.

g - The head of the institution is the account holder and is responsible before the Board of Management and the direct supervisory agency for the entire financial management and asset management work of the institution.

h - The annual financial results of semi-public institutions are determined based on the difference between total income and total expenditures of the unit in the fiscal year. If there is a significant surplus of income over expenditures, the Board of Management (for semi-public institutions) or the head of the unit (for public institutions with semi-public components) shall decide the allocation ratio for the following items:

+ Supplementing the operational capital of the institution by at least 30% of the total surplus income over expenditures.

+ The remainder shall be used to supplement income, rewards, and welfare for personnel within the institution, direct cooperators with the institution, and distribute income according to the capital contribution ratio (if applicable): Income derived from state capital contributions left for reinvestment to strengthen the material basis and record an increase in state capital contributions.

2 - For privately established Education and Training institutions:

a - Privately established Education and Training institutions operate under the principle of ensuring full coverage of unit costs and preserving and developing financial resources.

b - When privately established Education and Training institutions are assigned to carry out state programs, topics, and projects, they shall be funded by the state budget. This portion of funding shall be recorded separately and managed according to state regulations.

c - For unused assets or those that are technologically obsolete, privately established Education and Training institutions may sell them to recover capital. The institution shall establish a valuation committee and conduct auctions in accordance with legal regulations. Proceeds from the sale of assets, after deducting reasonable expenses for the sale process, shall be used to supplement the operational capital of the institution.

d - Annually, the Board of Management approves the budget for revenues and expenditures and specifies the structure of regular and investment expenditures; expenditures for personnel and operations; and determines the interest payments to organizations and individuals participating in capital contributions according to their contribution ratios.

g - Privately established Education and Training institutions shall regularly inspect and audit the use of funds within the institution; disclose all financial income and expenditure items and changes in assets according to their sources of formation for the knowledge of staff within the institution.

h - The annual financial results of privately established Education and Training institutions are determined based on the difference between total income and total expenditures of the unit in the fiscal year. The surplus of income over expenditures shall be decided by the Board of Management, after consulting the supporting agency, for the following items:

+ Strengthening the material basis by at least 30% of the total surplus income over expenditures;

+ The remainder shall be used for rewards and welfare for personnel within the unit, direct cooperators with the unit, and distributing income according to the capital contribution ratio;

i - Privately established Education and Training institutions shall implement accounting records in accordance with state-prescribed accounting systems, submit quarterly and annual comprehensive financial activity reports, and be subject to inspection and supervision by the same-level financial agency.

3 - For private Education and Training institutions:

Private Education and Training institutions are established in accordance with state regulations and operate under the principle of self-sufficiency in income and expenditure and responsibility for managing their own financial activities.

D - Financial settlement after dissolution, bankruptcy:

When non-state educational and training establishments declare bankruptcy or dissolution, the financial settlement shall be carried out in the following order of priority:

- Expenses as prescribed by law for the dissolution and bankruptcy proceedings of the establishment;

- Debts for salaries, severance pay, social insurance as stipulated by law, and other benefits according to signed labor contracts;

- Tax debts (if any);

- Debts owed to other organizations and individuals listed;

+ If the remaining value (assets and money) of the establishment is sufficient to settle all debts of creditors, each creditor shall be paid their full debt.

+ If the remaining value (assets and money) of the establishment is insufficient to settle all debts of creditors, each creditor shall only be paid a portion of their debt in proportion to the remaining value.

The remaining value (assets and money) of the establishment after fully settling the debts of creditors belongs to:

+ The owner of the establishment if it is a private establishment

+ The contributing members of the establishment (including the State budget) if it is a semi-public or self-established establishment.

III/ IMPLEMENTATION

This Circular takes effect fifteen days from the date of issuance.

During implementation, if there are any difficulties, they should be reported promptly to the Joint Ministries for review, amendment, and supplementation as appropriate./.

Place of Receipt:

- The Prime Minister

- National Assembly Office

- Office of the President

- Government Office

- Central Committee of the Party and Party Committees

- Supreme People's Court

- Supreme People's Procuracy

- Ministries, agencies equivalent to ministries, and agencies under the Government

- Central agencies of mass organizations

- Provincial People's Councils, People's Committees of centrally governed cities

- Departments of Planning and Investment, Departments of Education and Training, Departments of Labor, Invalids and Social Affairs of centrally governed provinces and cities

ANNEXED TO THIS CIRCULAR (Circular No. 209/2016/TT-BTC dated October 10, 2016 of the Minister of Finance)

- To be filed with the Ministry of Finance, Ministry of Education and Training, Ministry of Labor, Invalids and Social Affairs