Circular No. 46-TC/CĐKT guiding the accounting system for international aid funds

CIRCULAR

DIRECTIVE NO. 46-TC/CĐKT OF THE MINISTRY OF FINANCE ON AUGUST 15, 1991 GUIDING THE ACCOUNTING SYSTEM FOR INTERNATIONAL AID FUNDS AND GOODS.

To implement the State financial management functions for international aid funds and goods from planning to settlement and reporting as prescribed in Decision No. 142-HĐBT dated May 10, 1990 of the Council of Ministers, following Circular No. 45-TC/VT dated August 15, 1991 on the financial management system for international aid funds and goods, the Ministry of Finance guides the accounting and bookkeeping system for international aid funds and goods as follows:

I. FOR ADMINISTRATIVE AND PUBLIC SERVICE UNITS.

When receiving international aid funds and goods, units must distinguish which source these funds and goods belong to, whether they are regular operating funds or investment construction funds, to properly track and use appropriate accounts.

1. International aid in the form of goods, materials, and equipment.

- Upon receipt of aid goods, accountants record the actual receipt.

- If the source can be immediately determined, accountants record it accordingly.

Debit Account 21 - Raw Materials (217 - Detailed Aid Goods).

Credit Account 82 - Investment Construction Fund (821).

(If the source is for construction investment) or credit Account 84.

- Regular Operating Fund (841 - Budget Allocation) (if the source is regular operating fund or allocated for projects).

+ If the source cannot be immediately determined, accountants record:

Debit Account 21 - Raw Materials (217 - detailed aid goods).

Credit Account 60 - Payment with Seller (detailed budget).

+ Once confirmed through the budget, depending on the source,

debit Account 60 - Payment with Seller (detailed budget).

Credit Account 82 - Investment Construction Fund (821) or credit Account 84 - Regular Operating Fund (841).

When using aid goods:

+ If the aid goods are fixed assets put into use without installation or testing, accountants record:

Debit Account 38 - Administrative and Public Service Expenses (382). Credit Account 21 - Raw Materials (217).

Simultaneously increase fixed assets:

Debit Account 10 - Fixed Assets, Credit Account 80 - Fixed Asset Fund.

+ If the aid goods are fixed assets requiring installation or testing, or used for construction investment, accountants reflect this through Account 35 "Construction Investment Costs" according to current accounting regulations.

+ If the aid goods are materials or small tools, accountants record them in appropriate sub-accounts.

Debit 216 - Small Tools.

212 - Office Supplies.

Credit 217 - Detailed Aid Goods.

In cases where aid goods are distributed to dependent units or considered as such (units also implementing certain projects), accountants monitor distribution and settlement through Account 63 "Internal Settlement" (631) according to current regulations (guidance on internal settlement at Account 63) for dependent units receiving and using aid goods as previously instructed.

In cases where aid goods are provided free of charge to units or policy beneficiaries, treated as administrative and public service expenses, accountants record:

Debit Account 38 - Administrative and Public Service Expenses (382).

Credit Account 21 - Materials (217 - detailed aid goods).

In cases where aid goods are sold for revenue, accountants must record sales volume and value (including selling costs and sales tax if applicable) through Account 40 "Consumption and Results" according to regulations. The income difference from selling aid goods is recorded as an increase in regular operating funds.

Accountants follow current regulations for the usage and settlement process.

2. International aid in the form of foreign currency.

- When aid goods are foreign currency (cash, various types of checks), units must sell them to the centralized foreign exchange fund of the State. Upon receiving Vietnamese currency from the sale of foreign currency, accountants record:

Debit Account 51 - National Treasury Deposits (511).

Credit Account 60 - Payment with Seller (detailed budget). Upon confirmation of records through the budget, depending on the source, accountants record:

+ If the source is regular operating fund or allocated for specific projects:

Debit Account 60 - Payment with Seller (detailed budget).

Credit Account 84 - Regular Operating Fund (841).

+ If the source is construction investment:

Debit Account 60 - Payment with Seller (detailed budget)

Credit Account 82 - Construction Investment Fund (821).

In cases where units need to use foreign currency from the centralized foreign exchange fund of the State, they may apply to purchase it back when making payments, accountants record:

Debit Account 60 - Payment with Seller (payment for goods, costs).

Debit Account 38 - Expenditure from Regular Operating Funds (if directly included in costs).

Credit Account 51 - National Treasury Deposits (511).

If the unit receives foreign currency (before selling to the centralized foreign exchange fund of the State or after purchasing back from the centralized foreign exchange fund of the State) and transfers it to the unit's foreign exchange deposit account at the National Treasury, accountants record it through Account 51 "National Treasury Deposits" (512).

II. FOR PRODUCTION AND BUSINESS UNITS.

1. International aid in the form of goods, materials, and equipment.

When receiving international aid funds and goods, units must distinguish whether these funds and goods belong to production and business capital or construction investment capital.

Upon receipt of aid goods, accountants record the actual receipt:

Debit Account 21 - Raw Materials, Materials (217 - detailed aid goods).

Credit Account 60 - Payment with Seller (detailed budget).

When settling aid goods with the budget, accountants record:

Debit Account 60 - Payment with Seller (detailed budget)

Credit Account 51 - National Treasury Deposits (511)

Credit Account 90, 91, 92 (901, 911, 921).

In cases where units are penalized for late payment according to the specified deadline, the penalty amount is deducted from retained profits, accountants record:

Debit Account 70 - Income.

Credit Account 51 - National Treasury Deposits (511).

When using aid goods, accountants record according to the purpose of use appropriately.

+ If the aid goods are fixed assets put into use without going through the construction investment phase, accountants record:

Debit Account 10 - Fixed Assets.

Credit Account 21 - Raw Materials, Materials (217) simultaneously record.

Debit Account 82 - Construction Investment Fund (821).

Credit Account 80 - Fixed Asset Fund (801).

+ If used in the construction investment process, accountants reflect this through Account 35 "Construction Investment Costs" according to current regulations.

+ If used as circulating assets: raw materials, materials, small tools..., accountants record:

Debit Account 21 - Raw Materials, Materials (appropriate sub-account)

There is Account 21 - Raw materials, materials (217 - details of aid goods).

+ If distributed to dependent units and treated as such (units implementing the project together), accounting reflects through Account 63 "Internal Settlement" (631) according to the prescribed regulations.

+ In the case of selling aid goods and receiving payment, accounting must record sales revenue and the value of goods sold, including sales expenses and turnover tax (if applicable) through Account 40 "Consumption and Results" according to the prescribed regulations.

2. In the case of foreign currency:

- Refer to Circular No. 40-TC/CĐKT dated July 12, 1991, of the Ministry of Finance.

- In the case of aid goods in foreign currency (cash, various types of checks), the unit must deposit into the centralized foreign currency fund of the State, when there is a need for use, it can be repurchased, therefore, when depositing into the centralized foreign currency fund of the State, accounting only monitors the details of the deposited foreign currency by a single entry on the account outside the balance sheet under Debit Account 07 - Foreign currencies in detail (aid foreign currency usage rights).

When purchasing foreign currency for use, accounting records:

Debit Account 60 - Payment to suppliers (if paying for goods purchased, costs).

Debit Account 51 - Bank Deposits (512 - If purchasing foreign currency transferred to the bank deposit account).

Credit Account 51 - Bank Deposits (511) or

Credit Accounts 90, 91, 92, (901, 911, 921).

III. IMPLEMENTATION PROVISIONS

This Circular takes effect from January 1, 1991. During implementation, if there are any difficulties, units are requested to promptly report to the Ministry of Finance for supplementation and amendment.