Circular No. 55/2012/TT-BTC guides the method for determining the value of coffee gardens and tea gardens attached to processing facilities when state-owned enterprises undergo corporatization.

CIRCULAR

Guidelines for determining the value of coffee plantations, tea plantations associated with processing facilities during corporatization,

Implementing Circular No. 442/TTg-ĐMDN dated March 15, 2010 of the Prime Minister on the corporatization of plantations and planted forests associated with processing facilities.

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Pursuant to Decree No. 118/2008/NĐ-CP dated November 27, 2008, of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

Pursuant to Decree No. 89/2013/NĐ-CP dated August 6, 2013 of the Government detailing implementation of certain provisions of the Price Law on appraisal;

Considering the proposal of the Director of the Department of Corporate Finance, the Minister of Finance issues this Circular to guide the method for determining the value of coffee plantations and tea plantations associated with processing facilities during corporatization as follows:

The scope of application of this Circular is coffee plantations and tea plantations (hereinafter referred to as plantations) associated with processing facilities that are implementing pilot corporatization according to the plan approved by the Prime Minister, including: Plantations currently in the basic construction phase and plantations currently in the operating phase.

Article 1. Scope of Regulation

The subjects to which this Circular applies are: State-owned limited liability companies (including dependent units) having coffee plantations and tea plantations associated with processing facilities implementing corporatization according to the plan approved by the Prime Minister, including: State-owned limited liability companies established by Ministries, Provincial People's Committees (hereinafter referred to as Provincial People's Committees); Parent companies and subsidiaries within a parent company - subsidiary group belonging to state economic groups and corporations established by the Prime Minister, Ministers of Ministries, Provincial People's Committees (hereinafter referred to as companies).

Article 2. Applicability

Article 3. Requirements and principles for determining the value of plantations when piloting corporatization:

1. Plantations to be valued for corporatization: Are plantations currently under basic construction that continue to be invested in, and operating plantations retained for exploitation based on the actual inventory at the time of valuation for corporatization of the company.

The value of plantations to be valued for corporatization: Is the actual value of the plantations determined according to the agricultural investment cost rate issued by the competent authority at the time of valuation for corporatization of the plantations.

2. For plantations that have been decided to be liquidated by the competent authority but have not yet been organized for liquidation, there shall be no reassessment of their value for inclusion in the enterprise value. The company is responsible for handling them according to the current financial management regulations. At the time of transferring capital and assets from the company to the joint-stock company, if the liquidation has not been organized, the company is responsible for transferring the plantations awaiting liquidation to the following authorities:

a) The parent company of state economic groups and corporations, and the parent company in a parent company - subsidiary group to handle according to the regulations applicable to limited liability companies held 100% by enterprises.

b) Vietnam Asset Management Company Limited for companies not covered by point a, Clause 2, Article 3 of this Circular, to handle according to the provisions of the law.

3. For other assets outside the plantations (including land use rights value) when implementing corporatization, the company shall comply with the provisions of Decree No. 59/2011/NĐ-CP dated July 18, 2011 of the Government on converting wholly state-owned enterprises into joint-stock companies and the guiding documents for implementing Decree No. 59/2011/NĐ-CP of the Government.

3. For other assets outside of orchards (including the value of land use rights), when implementing corporatization, the company shall follow the provisions set forth in Decree No. 59/2011/NĐ-CP dated July 18, 2011 of the Government on converting State-owned enterprises with 100% State capital into joint-stock companies and the guiding documents for the implementation of Decree No. 59/2011/NĐ-CP issued by the Government.

Article 4. The competent authority shall decide on the contents prescribed in this Circular.

1. For the parent company of an Economic Group or a State-owned Corporation holding 100% of the charter capital established by the Prime Minister, and for a State-owned Company holding 100% of the charter capital established by the Ministers of Ministries, it shall be the Ministers of those Ministries.

2. For a State-owned Company holding 100% of the charter capital established by the People's Committee of a province, it shall be the Chairman of the People's Committee of that province.

3. For State-owned Companies holding 100% of the charter capital belonging to economic groups or corporations, it shall be the Board of Members of such economic groups or State-owned corporations.

Article 5. Determining the value of orchards

1. Determining the value of construction orchards Gi(xdcb)

The actual value of construction orchards is determined for each area (hectare) of the orchard and according to age i, specifically:

The actual value of 01 hectare of construction orchard at age i is Gi (xdcb) = The annual approved agricultural investment rate of the orchard according to age i multiplied (x) by the actual classification coefficient of construction orchard at age i, wherein:

a) The annual approved agricultural investment rate of the orchard according to age i: Is applied annually by the competent authority for the company or for companies within the region.

b) The actual classification coefficient of construction orchard at age i is based on the results of inventory, assessment, and classification of orchards into type A (good); B (average); C (poor), corresponding respectively to coefficients A equal to 1.2; B equal to 1; C equal to 0.8 according to the criteria for classifying orchards regarding tree height, trunk diameter, canopy diameter, number of primary branches, survival density, leaf color compared to technical standards specified by age by the competent authority.

- Gi (xdcb) = DT (xdcb) x Si (đt) x Hsi (xdcb), wherein:

+ Gi (xdcb) is the value of construction orchard at age i;

+ DT (xdcb) is the area of construction orchard;

+ Si (đt) is the agricultural investment rate of construction orchard at age i;

+ Hsi (xdcb) is the classification coefficient of construction orchard at age i;

c) The value of construction orchard G (xdcb) = ∑Gi (xdcb).

2. Determining the value of operating orchards Gi(kd)

The actual value of operating orchards is determined for each area (hectare) of the orchard according to age i, specifically:

The value of operating orchard (hectare) at age i is Gi (kd) = (Adjusted remaining value of operating orchard at age i multiplied (x) by the actual classification coefficient of operating orchard at age i, wherein:

a) Adjusted remaining value of operating orchard at age i: Equals the original value of operating orchard at age i minus (-) the accumulated depreciation value up to the time of determining the enterprise value for the privatization of the company, wherein:

- Original value of operating orchard at age i: Is determined according to the annual approved agricultural investment rate at age i applied annually by the competent authority for the company or for companies within the region.

- Accumulated depreciation value: Is calculated from the year the orchard begins operation to the valuation date based on the original value of the orchard determined according to the annual approved agricultural investment rate at age i and the annual depreciation rate according to the guidelines of the Ministry of Finance.

b) Actual classification coefficient of orchard at age i: Is determined based on the inventory, assessment of orchards according to criteria for classifying orchards into type A (good), B (average), C (poor) corresponding respectively to coefficients A equal to 1.2; B equal to 1; C equal to 0.8 according to the criteria for classifying orchards regarding survival rate, shade trees, yield compared to specified standards by the competent authority.

The value of operating orchard G (kd) = ∑Gi (kd).

3. Value of orchards for privatization:

The value of orchards for privatization G = Value of construction orchards G(xdcb) plus (+) the value of operating orchards G (kd).

Article 6. Effectiveness

This Circular takes effect from May 25, 2012.

During implementation, if there are difficulties or obstacles, units should report to the Ministry of Finance for research, amendment, and supplementation./.