Joint Circular No. 501-LB stipulates financial disbursement regulations, capital management, and settlement procedures for geological exploration activities.

JOINT CIRCULAR

DECREE NO. 501-LB OF THE MINISTRY OF FINANCE - NATIONAL GEOLOGICAL INVENTORY ON DECEMBER 31, 1983 REGULATING THE SYSTEM OF FINANCIAL ISSUANCE, CAPITAL MANAGEMENT AND SETTLEMENT FOR GEOLOGICAL EXPLORATION WORKS

Pursuant to Decision No. 71-CT dated March 11, 1983 of the Council of Ministers on reforming planning methods and economic accounting for geological exploration works under the National Geological Inventory, which stipulates that geological tasks reflected in geological plans (including budgets) shall serve as the basis for planning, financial issuance, settlement, and capital management for geological exploration works.
The Ministry of Finance and the National Geological Inventory hereby regulate and guide the implementation of the system of financial issuance, settlement, and capital management, which is part of the regulations concerning the planning system, establishment and approval of geological plans, and acceptance of completed geological work as issued in relevant joint circulars.

II- SUPPORT MEASURES FOR STATE-OWNED AGRICULTURAL FARMS AND FORESTRY COMPANIES IN THE FIELD OF SCIENCE AND TECHNOLOGY

1\. All geological tasks, including regional geological surveys, resource exploration (referred to as geological exploration), included in the annual plan must be determined from geological plans (comprising three parts: geological tasks, construction volume, and budget) established and approved according to prescribed principles.

Geological plans may be implemented in one step or divided into multiple steps over several years in accordance with the regulation on establishing plans of the National Geological Inventory.

The annual geological exploration plan is built based on the steps of the approved plans. Budgets for each step are developed based on volume, norms, and prices specified.

2\. Financial disbursement for geological exploration work is carried out when geological tasks of a plan step or the entire plan are completed and accepted according to current regulations of the National Geological Inventory.

Units implementing geological plans are entitled to a profit margin of 10% of the budgeted cost of the plan and this amount is included in the budget value of the plan.

3\. Survey work and costs for establishing plans must be approved and recorded in the state plan. Costs for this work, based on approved budgets, are settled once the geological plan is completed. If the plan is approved for execution, its settlement value is considered a completed step of the geological plan and included in the budget value of the plan; if not approved for execution, it is considered abandoned.

4\. Large temporary structures required to be depreciated as part of economic public funds are treated as a separate step of the overall geological plan. For structures serving a single plan, their costs are directly attributed to that plan. If they serve multiple plans, the costs are recorded in the main plan.

5\. Funds allocated for settling completed plan steps (or plans) are planned within the framework of economic public funds according to the format specified in Section II of this circular.

6\. Units implementing economic accounting are provided with working capital according to Decision No. 71-CP dated March 11, 1983 of the Council of Ministers.

Pending detailed regulations on working capital allocation, provisional advances will be made to ensure timely issuance and management of funds according to plans. Advance levels for each unit will be specifically reviewed by the Ministry of Finance and the National Geological Inventory.

Provisional advances to units will be processed through local investment and construction banks based on the funds transferred by the Ministry of Finance. Annually, advance levels will be adjusted, with excess funds recovered and additional funds provided if needed.

7\. Geological tasks undertaken by units through contracts with localities or economic units of other sectors shall be guaranteed funding and settlement according to economic contracts. The volume and value of contracted work must be recorded separately in the production, technical, and financial plans of the geological units.

8\. During the year, depending on the implementation of the geological exploration plan, the National Geological Inventory has the authority to adjust funds between plans within the approved annual budget, but not exceeding the total budgeted amount for approved plans. To ensure timely disbursement and settlement, the National Geological Inventory must detail the amounts adjusted between plans and inform relevant financial authorities and banks.

9\. In cases where the total budget of a geological plan exceeds 10%, affecting the annual budget, the National Geological Inventory must submit procedures for review and resolution to the Ministry of Finance and the State Planning Commission. Specific provisions for budget adjustments are detailed in Section II of this circular.

II- PLANNING OF FUNDS ISSUED

10\. Each year, based on approved geological plans currently underway, announced national geological exploration project plans, and state plan inspection results communicated by the National Geological Inventory, economic accounting units establish project plans for production, technical, and financial activities to be submitted to the National Geological Inventory within the specified timeframe.

11\. The National Geological Inventory reviews and refines these project plans of geological units, consolidates them into the industry's overall tasks, and submits them to the state.

Simultaneously, they are sent to the State Planning Commission and the Ministry of Finance within the prescribed period.

The industry-wide project plan of the National Geological Inventory must include financial income and expenditure plans, detailing the capital needs for each step of the plan to be completed in the annual plan, based on the planned volume of each task in those steps and the budgeted cost for each task.

12\. Based on the project plans of the National Geological Inventory, the Ministry of Finance collaborates with the State Planning Commission to draft plans for funds to be issued and settled for the National Geological Inventory to be submitted for state approval.

12- On the basis of the project plan of the Geological Survey General Department, the Ministry of Finance shall cooperate with the State Planning Committee to draft plans for capital allocation and payment to the Geological Survey General Department for submission to the State for approval.

13- When the geological exploration plan and the geological capital allocation plan are approved by the Council of Ministers, the Ministry of Finance will issue specific notifications regarding the capital allocation plan, transferring funds for settlement through the Investment and Construction Bank. The quarterly capital allocation amount is based on the documents and plans submitted by the General Department of Geology and verified.

14- Based on the geological exploration plan and the budget plan approved by the State, the General Department of Geology will establish a capital distribution plan for economic accounting geological units in accordance with completed geological tasks within the year, divided by quarter.

The total allocated capital for settlement of the implementation plan distributed to geological units shall not exceed the total capital recorded in the State budget plan for the General Department of Geology.

15- The documents and plans sent by the General Department of Geology to the Ministry of Finance and the Investment and Construction Bank include:

- A copy of the decision approving the geological P.A plan with steps.

- Annual and quarterly plans according to the steps of the plan.

- Capital allocation plan for the completion step and interim capital advance plan for the year.

- Comprehensive financial income and expenditure plan for the year (divided by quarter) of the entire industry.

- Quarterly, six-month, nine-month, and annual final accounts reports.

16- According to the principles implemented from before, after receiving the capital allocation notification from the Ministry of Finance and the planning documents from the General Department of Geology, the Central Investment and Construction Bank will notify the settlement capital down to local branch banks serving geological units.

17- Geological units must submit to local bank branches and provincial finance departments the following documents approved by the General Department of Geology:

To be sent to branches:

- A copy of the decision approving the geological plan with steps;

- Annual plan divided by plan steps;

- Capital allocation plan according to the completion plan;

- Interim capital advance plan for the year;

- Financial income and expenditure plan for the year (divided by quarter);

- Approved step plan estimates.

To be sent to the State Revenue Collection Bureau or State Revenue Collection Office and central enterprise financial management office: financial income and expenditure plan for the year divided by quarter and quarterly final accounts reports.

18- The deadline for sending the above documents from the General Department of Geology to the Ministry of Finance and the Central Investment and Construction Bank is as follows:

- Production and financial plan for the next year within 30 days from the date of signing the plan assignment decision of the Council of Ministers;

- Quarterly plan sent 15 days before the start of the quarter;

- A copy of the decision approving the plan within 30 days from the date of approval.

Geological units send to local bank agencies according to the above schedule plus an additional 10 days for each case.

19- During the year, the capital allocation plan may be adjusted for changes in the estimated prices of works in the plan steps. Adjustments to estimated prices are only allowed in the following cases:

- The State has decided to change wage levels, wage supplements, and other allowances, change material, equipment prices, depreciation rates, etc.;

- Changes in comprehensive norms for geological exploration;

- Variations in geological conditions compared to the estimate when formulating the plan.

20- Any adjustments to the plan related to either of the following two conditions must be approved by the authority that approved the geological task plan:

- Changing the objectives of the geological plan;

- Exceeding the approved contingency reserve for the plan.

III- CAPITAL SETTLEMENT FOR PLAN STEPS AND COMPLETED GEOLOGICAL PLANS

21- Plan steps can only be settled when the following conditions are met:

- All works of the step have been completed in accordance with quality and geological objectives specified in the annual plan;

- Achieved acceptance results in accordance with the acceptance procedures issued by the General Department of Geology.

The settlement price for the completed plan step is the estimated price approved by the competent authority. During construction, if there are increases or decreases in volume and costs, the increase or decrease in volume confirmed by the Acceptance Committee and approved by the competent authority under current regulations shall be included in the settlement.

22- The basis for settling capital for the completed plan step includes:

- Completion acceptance record of the step;

- Decision on handling matters within the authority's jurisdiction if applicable;

- Settlement statement of the value of the completed volume of the step according to the estimated price and a profit margin of 10%;

- Documents approving the values of saved volumes from higher authorities (if any);

- Calculations explaining the adjustment of the estimated cost.

23- The final step of the geological task can only be settled when the following documents are available:

- Documents stipulated in Article 22 above;

- Handover report record;

- Approval document of the report by the competent authority.

24- In cases where geological tasks, including survey design tasks for plan formulation, are suspended according to the decision of the competent authority and losses due to objective reasons, capital settlement will be provided for the volume of work already completed.

The documents for settlement are:

- Decision suspending construction of the geological task;

- Final account report of the costs of the completed work volume;

- Verification confirmation record of the Acceptance Committee.

IV- ACCEPTANCE AND FINAL ACCOUNTING FOR COMPLETED GEOLOGICAL PLANS

25- The acceptance work for the completed geological plan step is conducted by the Acceptance Committee appointed by the General Director. It proceeds and operates in accordance with the acceptance procedures issued by the General Department. Financial and banking agencies participate in the Acceptance Committee as official members. Based on the quality and results of the completed geological plan step, the Acceptance Committee is responsible for calculating, checking, confirming the adjustment of the estimated cost, and recommending capital settlement for the accepted geological plan.

26- Geological plans must be finalized when the approved geological plan summary report is submitted to the archives (or handed over to the ordering agency). Within a maximum of 30 days, the unit must submit the final account report to the following agencies:

- General Department of Geology

- Ministry of Finance

- Central Investment and Construction Bank.

The Geological Survey shall review the final settlement report of geological tasks submitted by units, in coordination with the financial agency and bank at the same level, and must notify the result of such review to the unit within thirty days from the date of receipt of the final settlement report.

V- REWARDS AND PENALTIES FOR GEOLOGICAL TASKS

27- In order to encourage geological units to complete geological schemes with quality according to economic and technical targets set forth (increasing mineral reserves, shortening completion time, and saving costs), geological schemes meeting the following requirements shall be considered for rewards:

Fulfilling quality standards (in accordance with the regulations of the Geological Survey on acceptance procedures for various types of work), specifically: - The average acceptance points of all stages meet the acceptance requirements;

- The summary report of the geological scheme reaches a good grade or higher;

- Completing the targets set for the geological scheme;

- Production costs of the geological scheme do not exceed the approved total budget estimate;

- Completion time adheres to the prescribed plan;

The amount of reward, usage purposes, and distribution ratio will be specified later.

Reward funds shall be included in the budget of the geological scheme as a separate item.

28- If a geological task does not meet the acceptance requirements, the unit shall be penalized, and the penalty amount will be deducted from the incentive fund and welfare fund.

The Acceptance Committee is the body recommending rewards and penalties for geological schemes. After obtaining the agreement of the Ministry of Finance, the Director of the Geological Survey shall issue a decision on rewarding the geological unit that implements the scheme.

VI- IMPLEMENTATION PROVISIONS

29- This Circular shall take effect from January 1, 1984, for research and exploration units under the Geological Survey.

It is requested that the Central Investment and Construction Bank guide the payment procedures and capital management for geological units in accordance with point e of Decision 71-CT dated March 11, 1983, of the Council of Ministers' Chairman and the decisions stipulated in this Circular.

According to current regulations, at year-end, the Central Investment and Construction Bank shall settle accounts with the state budget for the capital paid out for completed stages (or schemes) and the temporarily advanced capital.

Any previous regulations contrary to this Circular are hereby abolished.