Circular No. 44-TC/KBNN guides the control of state budget expenditures pursuant to Decision No. 861/TTg of the Prime Minister.

CIRCULAR

OF THE MINISTRY OF FINANCE NUMBER 44 TC/KBNN ON JULY 31, 1996 GUIDING THE CONTROL OF EXPENDITURE FROM THE STATE BUDGET ACCORDING TO DECREE NO. 861/TTG OF THE PRIME MINISTER

To implement Decision No. 861/TTg dated December 30, 1995 of the Prime Minister on some mechanisms and measures for managing and operating the State Budget in 1996; In order to gradually strengthen the management of expenditure from the State Budget, moving towards implementation according to the State Budget Law starting from the 1997 fiscal year, the Ministry of Finance guides the control of certain large expenditures from the State Budget as follows:

I. GENERAL PROVISIONS:

1. The allocation and payment of expenditures under the State Budget for the year 1996 shall be carried out according to the current financial management mechanism. For certain large expenditures of the State Budget, they must be inspected and controlled in accordance with the specific guidelines set forth in this circular.

2. Financial agencies and State Treasury at all levels shall closely coordinate to allocate budget funds and cash to ensure timely and proper disbursement and payment in accordance with regulations.

3. Units using the State Budget shall be responsible for using funds for their intended purposes, for the designated recipients, within the established standards and financial expenditure regulations, while also being subject to inspection and control by financial agencies and the State Treasury during the planning, allocation, utilization, accounting, and settlement of the State Budget.

II. SPECIFIC PROVISIONS REGARDING THE CONTROL OF CERTAIN EXPENDITURES FROM THE STATE BUDGET:

1. Salaries and other allowances of a salary nature (excluding retirement pay and social assistance):

The control, allocation, and payment of salaries and other allowances of a salary nature under the State Budget shall be implemented according to Circular No. 31TT/LB issued jointly by the Ministry of Finance and the Government Civil Service Management Board on February 6, 1995, specifically as follows:

1.1. Based on the number of civil servants and employees approved by the competent authority and the salary fund in the financial plan announced, the unit shall prepare a quarterly salary fund and allowance plan and submit it to the same-level financial agency and the State Treasury where the unit conducts transactions.

1.2. The financial agency shall inspect and allocate the salary fund to the unit; the inspection and allocation of the salary fund must adhere to the principle that:

- No funding shall be allocated for cases of unauthorized increases in the salary fund such as hiring civil servants and employees, or increasing salaries not in accordance with regulations.

- The amount of funding allocated to the unit must clearly specify the salary and allowance categories. If the allocated funding for salary and allowance categories is not fully utilized, it can be transferred to the next month for expenditure; by December 31, if there is surplus funding for salary and allowance categories, it will be canceled; in case of shortage, the financial agency will supplement the funding but it cannot exceed the approved salary fund in the financial plan.

1.3. The payment of the salary fund and other allowances to units shall be carried out by the State Treasury based on:

- Registration of the establishment quota and salary fund approved by the competent authority (including additional registration of establishment quota and salary fund changes if applicable).

- The funding limit for salary and other allowances provided by the financial agency.

- The report on the previous month's salary and allowance payments made by the unit.

The State Treasury shall inspect and pay the salary and other allowances to the unit monthly. Where conditions permit, the State Treasury may directly pay the salary to civil servants and state employees through personal accounts opened at the State Treasury. In cases where there is a discrepancy between the actual allocation and actual expenditure of the unit, the State Treasury will provide supplementary funding (if insufficient) or deduct from the next month's allocation (if excess) within the approved salary fund and the funding limit provided by the State Treasury.

1.4. Quarterly, units shall report on the implementation of salary and other allowance expenditures to the financial agency and higher-level management authorities with confirmation from the State Treasury where the unit has an account.

- The State Treasury shall consolidate the payment of the salary fund and submit it to the same-level financial agency.

2. Expenditures for purchasing assets, minor repairs, and construction:

2.1. Based on the approved State Budget expenditure plan, units shall prepare detailed plans for asset purchases, repairs, and minor construction and submit them to the same-level financial agency and the State Treasury where the unit has an account.

2.2. Based on the approved State Budget, the detailed expenditure plan of the unit, and the availability of State Budget funds, the financial agency shall allocate funding to the unit according to the progress of work; the funding limit of the financial agency shall clearly specify the purchase, repair, and minor construction categories.

2.3. - The State Treasury shall conduct inspections, controls, and direct payments to suppliers or pass through the budget-using unit based on the request of the budget-using unit, based on:

+ The approved detailed plan for asset purchases, repairs, and minor construction.

+ The funding limit provided by the financial agency.

+ Other related documents such as contracts, bidding minutes, quotations...

- Payment and disbursement must adhere to the principle that:

+ No payments shall be made for expenditures not included in the approved budget plan or included in the budget plan but not funded by the financial agency.

+ Payments for the purchase of small cars shall only be made to units upon approval by the Prime Minister, recorded in the approved State Budget plan, and funded by the financial agency.

+ For expenditures on purchases, repairs, and construction with a value or total value of 100 million dong or more, tendering documents must be submitted in accordance with Decision No. 20TC/KBNN dated January 17, 1996, of the Minister of Finance.

3. For expenditures on economic affairs and programs, objectives:

3.1. For expenditures on programs and objectives allocated by financial authorities (including those under the Central Budget delegated through the Department of Finance and Prices), financial authorities at all levels shall be responsible for directly allocating funds to beneficiaries according to the approved budget and prescribed expenditure standards.

On the basis of the allocation decision of the financial authority, the State Treasury shall make payments to the beneficiaries.

Beneficiary agencies and units shall be responsible for using the funds for their intended purposes and objects in accordance with the prescribed expenditure standards, and reporting and settling accounts with the financial authority as stipulated.

3.2. For expenditures on public services such as transportation, geology, Program 327, 773, settlement stabilization... managed and allocated for direct payment by the State Treasury, such activities shall be carried out in accordance with current regulations.

Based on the approved plan index, the financial authority shall transfer funds to the State Treasury; the State Treasury shall organize inspections, appraisals, allocations, and payments in accordance with current regulations to ensure that they are for the intended purpose and object as per the approved budget.

4. For construction investment expenditures:

Construction investment expenditures shall be managed, allocated, and paid in accordance with current regulations on investment management and basic construction.

- Based on the approved basic construction investment capital plan, the financial authority shall transfer funds to the development investment agency for allocation and payment.

- The development investment agency shall directly inspect, appraise, allocate, and pay for completed basic construction works in accordance with current regulations.

III. IMPLEMENTATION:

1. This Circular shall take effect in the 1996 State Budget year.

2. Ministries, sectors, People's Committees at all levels, state budget-using units, financial system units, and the State Treasury shall be responsible for implementing this Circular.