Joint Circular No. 68/2011/TTLT-BGTVT-BTC guiding the financial management mechanism for the Vietnam Vehicle Inspection Agency

JOINT CIRCULAR

Guidelines for the financial management mechanism for the Vietnam Vehicle Inspection Agency

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Pursuant to Decree No. 31/2005/NĐ-CP dated March 11, 2005 of the Government on production and supply of public goods and services;

Pursuant to Decree No. 57/2002/ND-CP dated June 3, 2002 of the Government detailing the implementation of the Ordinance on fees and charges; Decree No. 24/2006/ND-CP dated March 6, 2006 of the Government amending and supplementing certain articles of Decree No. 57/2002/ND-CP dated June 3, 2002 of the Government detailing the implementation of the Ordinance on fees and charges;

Pursuant to Decision No. 256/2006/QD-TTg dated November 9, 2006 of the Prime Minister promulgating the bidding, ordering, and production and supply plan for public utility products and services;

Pursuant to Circular No. 117/2010/TT-BTC dated August 5, 2010 of the Ministry of Finance guiding the charter of a limited liability company with one member being the State; Circular No. 138/2010/TT-BTC dated September 17, 2010 guiding profit distribution for a limited liability company with one member being the State;

Implementing the opinions of the Prime Minister in Official Letter No. 807/TTg-ĐMDN dated June 17, 2005 of the Prime Minister regarding the supplementation of technical inspection activities of motor vehicles into Appendix B of the list of public utility products and services issued together with Decree No. 31/2005/NĐ-CP dated March 11, 2005 of the Government on production and supply of public utility products and services; Official Letters No. 609/VPCP-KTTH dated January 26, 2010 and No. 5872/VPCP-KTTH dated August 25, 2011 of the Government Office regarding the financial mechanism and profit distribution of the Vietnam Vehicle Inspection Agency;

Based on the specific nature of the operations of the Vietnam Vehicle Inspection Agency, the Ministry of Transport and the Ministry of Finance provide guidelines for the financial management mechanism for the Vietnam Vehicle Inspection Agency as follows:

This technical regulation sets out technical requirements, testing methods, sampling procedures; management requirements; responsibilities of organizations and individuals producing, trading, and importing cigarettes.

Article 1. Scope of Regulation and Applicability

Article 1. This Circular stipulates the financial management mechanism applicable to the Vietnam Vehicle Inspection Agency and its subordinate units.

2. The sources of income and expenditure of administrative and public service funds allocated by the State Budget to the Vietnam Vehicle Inspection Agency shall be managed, accounted for, and settled separately according to the provisions of the Law on State Budget, without applying the provisions of this Circular.

II. MANAGEMENT AND USE OF CAPITAL AND ASSETS

Article 2. Operating capital of the Vietnam Vehicle Inspection Agency

1. The operating capital of the Vietnam Vehicle Inspection Agency includes: Capital invested by the State at the Vietnam Vehicle Inspection Agency, capital mobilized by the Vietnam Vehicle Inspection Agency, and other sources of capital as prescribed by law.

2. Capital invested by the State at the Vietnam Vehicle Inspection Agency includes: Capital provided by the State when establishing the Vietnam Vehicle Inspection Agency and throughout its operation; capital received from other places transferred according to the decision of the competent authority; the value of grants, gifts, unclaimed property, surplus property identified during inventory which is recorded as an increase in State capital; capital supplemented from post-tax profits; the value of land use rights and other items included in State capital according to the provisions of law.

3. Mobilized capital of the Vietnam Vehicle Inspection Agency includes: loans from banking and credit organizations, other financial organizations, individuals, and organizations outside the Vietnam Vehicle Inspection Agency; loans from employees and other forms of capital mobilization as prescribed by law.

Article 3. Mobilizing capital

1. Principles for raising capital:

a) Mobilizing capital must ensure the ability to repay debt and have a plan approved by the competent authority. The person approving the capital mobilization plan must be responsible for monitoring and ensuring that the mobilized capital is used for the intended purpose, for the intended recipient, and is effective.

b) Borrowing from individuals and economic organizations: The Vietnam Vehicle Inspection Agency must enter into a loan agreement with the lending economic organization or individual in accordance with the law; the maximum interest rate on borrowing shall not exceed the interest rate for loans of the same term offered by the commercial bank where the Vietnam Vehicle Inspection Agency has an account at the time of borrowing; if the Vietnam Vehicle Inspection Agency has accounts with multiple banks, the maximum direct borrowing interest rate shall not exceed the highest interest rate for loans of the same term offered by the commercial bank where the Vietnam Vehicle Inspection Agency has an account.

c) Mobilizing capital from foreign organizations and individuals shall be carried out in accordance with current regulations on managing foreign debt.

d) Subordinate units of the Agency are not permitted to mobilize capital.

2. Authority to approve capital mobilization plans:

a) The Vietnam Vehicle Inspection Agency may independently mobilize capital for business operations within the total amount of debt not exceeding the Shareholders' Equity recorded in the most recent quarterly financial report of the Vietnam Vehicle Inspection Agency at the time of capital mobilization.

b) In cases where the Vietnam Vehicle Inspection Agency needs to mobilize capital beyond the limit set forth in point a of Clause 2 of this Article, it must report to the Ministry of Transport for consideration and decision based on effective capital mobilization projects. After making the decision, the Ministry of Transport shall be responsible for informing the Ministry of Finance to coordinate in monitoring and supervising.

3. The Ministry of Transport shall closely monitor the mobilization and use of capital at the Vietnam Vehicle Inspection Agency, and the Ministry of Finance shall carry out inspections and supervision in accordance with the law.

Article 4. Preservation of Capital at the Vietnam Vehicle Inspection Center

1. Any changes to capital, the Vietnam Vehicle Inspection Center shall be responsible for reporting to the Ministry of Transport and the Ministry of Finance for monitoring and supervision.

Every six months and annually, the Vietnam Vehicle Inspection Center must evaluate the effectiveness of capital usage through the capital preservation ratio index.

The capital preservation ratio:

The degree of capital preservation is determined according to coefficient H:

If coefficient H > 1, the Vietnam Vehicle Inspection Center has developed capital; H = 1, the Vietnam Vehicle Inspection Center has preserved capital; and H < 1, the Vietnam Vehicle Inspection Center has not preserved capital.

In case the Vietnam Vehicle Inspection Center has not preserved capital, the Director of the Vietnam Vehicle Inspection Center must submit a report explaining the reasons for not preserving capital, measures to address this issue in the future, to the Ministry of Transport, the Ministry of Finance, and bear responsibility for the financial situation of the Vietnam Vehicle Inspection Center.

2. The Vietnam Vehicle Inspection Center is responsible for preserving capital through the following measures:

- Implementing the state regulations on the management and use of capital, assets, profit distribution, other financial management systems, and accounting procedures;

- Purchasing insurance for assets as prescribed by law;

- Promptly handling the value of lost assets as stipulated in Article 13 of this Circular, unrecoverable debts as stipulated in Article 6 of this Circular, and setting aside provisions for risks as prescribed.

- Other measures for preserving capital and state assets as prescribed by law.

Article 5. Investment of Capital Outside the Vietnam Vehicle Inspection Center

1. The Vietnam Vehicle Inspection Center is authorized to use its assets (including cash, fixed assets, current assets, and other assets) under its management to invest outside the Vietnam Vehicle Inspection Center for projects related to vehicle inspection work. The Vietnam Vehicle Inspection Center is not allowed to invest in real estate, banking, insurance, securities, and other unrelated fields.

2. The investment of capital by the Vietnam Vehicle Inspection Center in other enterprises must comply with legal regulations, align with the strategic plans, planning, and development plans of the Vietnam Vehicle Inspection Center, without affecting the fulfillment of tasks assigned by the Ministry of Transport, and must ensure efficiency, preservation, and development of capital, and increased income.

3. The total amount of capital invested outside the Vietnam Vehicle Inspection Center (including short-term and long-term investments) shall not exceed 20% of the equity value recorded in the latest published financial statement of the Vietnam Vehicle Inspection Center when it submits the investment plan to the Ministry of Transport.

4. Investment of capital outside the Vietnam Vehicle Inspection Center can only be carried out after receiving written approval from the Ministry of Transport.

Article 6. Management of Inventory Goods

1. Inventory goods include goods purchased for sale that remain in stock, raw materials, materials, tools, equipment in stock, goods in transit, unfinished products in production, completed products not yet warehoused, finished products in stock, and finished products awaiting sale.

2. The Vietnam Vehicle Inspection Center has the right and is responsible for promptly disposing of inferior, deteriorated, outdated, technologically obsolete, stagnant, and slow-moving inventory goods to recover capital. Decision-making authority for disposal is as stipulated in Clause 2 of Article 11.

3. At the end of the accounting period, if the original cost of inventory goods recorded in the accounting books exceeds the net realizable value, the Vietnam Vehicle Inspection Center must establish a provision for the reduction in the value of inventory goods in accordance with current legal regulations.

Article 7. Management of receivables and payables

1. Receivables

a) Responsibilities of the Vietnam Vehicle Inspection Agency:

- Establishing and promulgating regulations on the management of receivables, assigning and clearly defining the responsibilities of collectives and individuals in tracking, recovering, and settling debts;

- Maintaining ledgers to track receivables by debtor category; regularly classifying receivables (current receivables, difficult-to-collect receivables, unrecoverable receivables), and urging their recovery.

- For foreign currency receivables, the Vietnam Vehicle Inspection Agency must monitor in detail according to each type of original currency, at the end of the period, re-evaluate and handle exchange rate differences in accordance with regulations.

- The Director of the Vietnam Vehicle Inspection Agency and the Directors of subordinate units have the responsibility to promptly handle difficult-to-collect receivables and unrecoverable receivables. If they fail to promptly handle unrecoverable receivables as stipulated in this clause, the Director of the Vietnam Vehicle Inspection Agency or the Director of the relevant subordinate unit will be relieved of their position as if they had reported financial status of the unit inaccurately from two times or more. If failure to promptly handle leads to loss of state investment capital at the Vietnam Vehicle Inspection Agency, the Director of the Vietnam Vehicle Inspection Agency and the Directors of subordinate units shall bear responsibility before the Ministry of Transport and under the law.

- Difficult-to-collect receivables are overdue payments according to the terms recorded in contracts or other commitments, or not yet due but the debtor has difficulty in payment capability. The Vietnam Vehicle Inspection Agency is responsible for setting aside provisions for difficult-to-collect receivables in accordance with current regulations of the Ministry of Finance.

- Unrecoverable receivables, the Vietnam Vehicle Inspection Agency is responsible for handling: After deducting compensation from related individuals or groups, the remaining amount is covered by the provision for difficult-to-collect receivables, financial reserve fund. If there is still a shortage, it is recorded as operating expenses of the Vietnam Vehicle Inspection Agency.

- Unrecoverable receivables after such handling, the Vietnam Vehicle Inspection Agency must continue to monitor outside the balance sheet account and organize recovery. Recovered amounts are recorded as income of the Vietnam Vehicle Inspection Agency.

b) Rights of the Vietnam Vehicle Inspection Agency:

The Vietnam Vehicle Inspection Agency has the right to sell receivables in accordance with the law, including receivables within the due date, difficult-to-collect receivables, and uncollectible receivables to recover capital. The sale of debts can only be carried out with economic organizations having the function of buying and selling debts, and cannot be sold directly to debtors. Sale prices of receivables are agreed upon by the parties and each party bears responsibility for the decision to sell receivables. In case of debt sale leading to losses, capital loss, or loss of payment capability resulting in financial imbalance, the Director of the Vietnam Vehicle Inspection Agency and those directly related to the occurrence of difficult-to-collect receivables must compensate according to the law.

2. Management of Payables:

a) Maintain complete records of all payables, including interest payable:

b) Pay payables according to the agreed deadlines. Regularly review, evaluate, and analyze the payment capability of the agency, detect early difficulties in paying debts to take timely measures to prevent overdue debts from arising.

Article 8. Fixed Assets - Investment in Fixed Assets

1. Fixed assets of the Vietnam Vehicle Inspection Agency include tangible and intangible fixed assets. Standards for determining fixed assets are implemented in accordance with current regulations of the Ministry of Finance.

2. The Director of the Vietnam Vehicle Inspection Agency decides on the purchase of assets and investment projects with a value less than or equal to 30% of the total asset value recorded in the most recent quarterly Financial Report of the agency, but not exceeding the highest limit of Project Group B as prescribed by laws on project management and construction.

3. For the purchase of assets or investment projects exceeding the limits set forth in Clause 2 of this Article, the Vietnam Vehicle Inspection Agency is responsible for submitting to the Ministry of Transport or competent authorities for approval in writing.

4. The procedures for investment implementation shall be carried out according to the provisions of the Law on Project Management for Investment and Construction.

5. The Director of the Vietnam Vehicle Inspection Agency may decide on the internal transfer of assets among subordinate units of the Vietnam Vehicle Inspection Agency. Specifically, for assets that are office premises, prior to transfer, approval in writing from the Ministry of Transport is required.

Article 9. Depreciation of Fixed Assets

The existing fixed assets of the Vietnam Vehicle Inspection Agency shall be managed, utilized, and depreciated in accordance with the current regulations of the Ministry of Finance.

Article 10. Leasing, Pledging, and Hypothecation of Assets

The Vietnam Vehicle Inspection Agency may lease, pledge, or hypothecate assets only after obtaining written approval from the Ministry of Transport. The use of assets for leasing, pledging, or hypothecation must comply strictly with the provisions of the Civil Code and other relevant laws.

Article 11. Liquidation and Sale of Fixed Assets

1. The Vietnam Vehicle Inspection Agency is permitted to sell or liquidate fixed assets that are damaged, technologically obsolete, unnecessary for use, or unusable.

2. Authority to Decide on Liquidation and Sale of Fixed Assets:

a) The Director of the Vietnam Vehicle Inspection Agency may decide on plans for the liquidation or sale of fixed assets whose remaining value does not exceed 30% of the total asset value recorded in the most recent published financial report of the Vietnam Vehicle Inspection Agency.

b) For plans involving the liquidation or sale of fixed assets with a value exceeding the aforementioned classification level, the Director of the Vietnam Vehicle Inspection Agency must report to the Ministry of Transport for a decision.

3. Fixed assets directly serving the provision of public services by the Vietnam Vehicle Inspection Agency must obtain written consent from the Ministry of Transport when sold or liquidated. The Ministry of Transport will review and authorize the Vietnam Vehicle Inspection Agency to independently liquidate certain assets in specific cases.

4. In cases where the plan for selling fixed assets of the Vietnam Vehicle Inspection Agency cannot recover the full capital, the Vietnam Vehicle Inspection Agency must report to the Ministry of Transport and the Ministry of Finance before selling the fixed assets to ensure supervision.

5. Specifically, if newly invested fixed assets fail to generate economic benefits as initially approved, and the Vietnam Vehicle Inspection Agency has no need to continue using them, and the sale of these assets cannot recover the full investment capital leading to the inability to repay loans according to loan agreements or borrowing contracts, then the responsibility of those involved must be clarified and reported to the Ministry of Transport for handling in accordance with the law.

6. Methods of Liquidation and Sale of Fixed Assets: The sale of fixed assets shall be conducted through public auction via an organization authorized to conduct asset auctions or by the unit itself following the prescribed procedures and formalities under the law on asset auctions. If the remaining value of the fixed assets to be liquidated or sold, as recorded in the accounting books, is less than 100 million VND, the Vietnam Vehicle Inspection Agency decides to choose between auctioning or negotiating sales but not below market price. In cases where there are no transactions for such fixed assets in the market, the Vietnam Vehicle Inspection Agency may hire an organization authorized to appraise prices to determine the basis for selling the assets through the above methods.

Article 12. Inventory of Assets

The Vietnam Vehicle Inspection Agency must organize an inventory to determine the quantity of assets (fixed assets and long-term investments, current assets and short-term investments), reconcile receivables and payables when closing the accounting books to prepare annual financial reports; when implementing decisions on division, separation, merger, ownership conversion; after natural disasters or enemy attacks; or due to any reasons causing asset fluctuations within the unit; or in accordance with state policies. For excess, missing assets, unrecoverable debts, overdue debts, the causes and responsibilities of those involved must be clearly identified, and material compensation levels determined in accordance with the law.

Article 13. Handling of Property Losses

Property loss refers to property that is missing, short, damaged, deteriorated in quality, outdated in fashion or technology, and surplus inventory identified during regular and spot inventory checks. The Vietnam Vehicle Inspection Agency must determine the value of the loss, its cause, responsibility, and handle it as follows:

1. If the cause is subjective, the person causing the loss must compensate. The Director of the Vietnam Vehicle Inspection Agency decides on the compensation amount according to the law and is responsible for their decision.

2. For insured property, if there is a loss, it shall be handled according to the insurance contract.

3. The value of the lost property, after being compensated with personal or collective funds and insurance organization funds, if still insufficient, shall be covered from the financial reserve fund of the unit. In cases where the financial reserve fund is insufficient, the shortfall shall be recorded as production and business expenses for the period.

4. In special cases caused by natural disasters or irresistible causes resulting in severe damage, if the Vietnam Vehicle Inspection Agency cannot self-recover, the Director of the Vietnam Vehicle Inspection Agency shall develop a plan to handle the loss and submit it to the Ministry of Transport and the Ministry of Finance. After receiving the opinion of the Ministry of Finance, the Ministry of Transport will decide on handling the loss within its authority.

5. The Vietnam Vehicle Inspection Agency has the responsibility to promptly handle property losses; in cases where property losses are not handled, the Director of the Vietnam Vehicle Inspection Agency will bear responsibility before the Ministry of Transport.

Article 14. Revaluation of Assets

1. The Vietnam Vehicle Inspection Agency conducts asset revaluation according to the Decision of the competent state agency.

2. Asset revaluation must comply with state regulations. Any increases or decreases in asset values due to revaluation shall be handled according to current state regulations for each specific case.

III. REVENUES, EXPENSES AND OPERATING RESULTS

Article 15. Revenue

Revenue of the Vietnam Vehicle Inspection Agency includes revenue from inspection activities, revenue from related activities, and revenue from service activities outside public welfare inspection duties.

1. Revenue from inspection activities is revenue as prescribed by the State, including:

a) Reviewing and assessing designs of vehicles and equipment in the transportation sector before new construction or modification;

b) Testing safety and technical standards and environmental protection for vehicles and equipment in the transportation sector;

c) Evaluating management systems for safety, security, and maritime security plans according to the Safety Management Law (ISM Code) and the Security and Port Facility Security Law (ISPS);

d) Assessing and issuing certificates for quality management and environmental protection systems at the request of organizations and enterprises according to the law;

đ) Inspecting the technical condition of transportation vehicles and equipment and offshore exploration, extraction, and transport equipment at the request of state agencies or vehicle owners;

e) Cooperating with foreign inspection organizations in mutual inspection according to agreements;

g) Other inspection activities as prescribed by the State.

2. Revenue from other activities related to inspection activities:

a) Income from training inspector services, publishing the Inspection Magazine, income from issuing stamps and books according to a unified model for inspection units throughout the industry;

b) Income from liquidation and sale of assets; surplus asset value after inventory;

c) Income from financial activities: interest from bank deposits, interest from foreign exchange rate differences;

d) Recovery of written-off debts;

đ) Collection of contractual breach penalties from partners;

e) Other revenues related to inspection activities.

3. Revenue from service activities outside public welfare duties such as acting as agents for selling insurance for motor vehicles, consulting, scientific and technological services related to the technical safety of transportation vehicles and equipment, and other revenues as prescribed.

Article 16. Costs

The costs of the Vietnam Vehicle Inspection Agency include costs for inspection activities, costs for other activities, and costs for service activities outside public welfare inspection tasks.

1. Costs for inspection activities:

Inspection activity costs are all costs arising from the provision of public welfare inspection services reflected in the fiscal year, including:

a) Material, fuel, power, semi-finished product, and external service purchase costs (calculated based on actual consumption and original cost), tool and equipment depreciation costs, fixed asset repair costs, and pre-funded major fixed asset repair costs.

b) Depreciation costs of fixed assets as stipulated in Article 9 of this Circular;

c) Wages, remuneration, and wage-like costs payable to employees as decided by the Director of the Agency based on the wage rate assigned by the Ministry of Transport and implemented according to the guidelines of the Ministry of Labor, Invalids, and Social Affairs;

d) Social insurance funds, trade union fees, health insurance, unemployment insurance for employees that the Vietnam Vehicle Inspection Agency must pay as prescribed;

đ) Transaction, brokerage, hospitality, marketing, trade promotion, advertising, meeting costs calculated based on actual expenses incurred and the provisions of the Law on Corporate Income Tax;

e) Other monetary costs as prescribed include:

- Resource taxes, land taxes, business license taxes;

- Land rental payments;

- Severance pay for laid-off workers;

- Training to enhance management capabilities and skills of employees;

- Health work costs as prescribed;

- Scientific research costs, technological innovation research costs;

- Incentive awards for improvement initiatives, productivity increases, material savings, and costs. The award amount is determined by the Director of the Vietnam Vehicle Inspection Agency based on the effectiveness of the work but shall not exceed the cost savings generated by such work within one year;

- Costs for female workers;

- Environmental protection costs;

- Costs for Party and mass organization work at the Vietnam Vehicle Inspection Agency (costs outside the organizational budget funded from designated sources);

- Other monetary costs.

g) Actual value of lost property, unrecoverable receivables as stipulated in Article 7 of this Circular;

h) Values of inventory write-down reserves, bad debt reserves, and other reserves established as prescribed in Clause 2, Article 7 of this Circular, exchange rate differences on long-term foreign currency loans, pre-funded warranty costs, and other reserves required by law for businesses operating in special sectors;

2. Costs for other activities:

a) Instructor rental costs as prescribed and related training organization costs, editorial, royalties, printing costs related to magazine publication, printing costs for forms, stamps, registers to be distributed to inspection units as prescribed;

b) Fixed asset disposal and sale costs, including residual values of fixed assets when disposed of or sold, shortages found after inventory (after deducting the responsibility of related collectives and individuals);

c) Financial activity costs, including interest paid on capital raised, exchange rate differences, discount payment costs, and other financial costs as prescribed;

d) Costs for recovering written-off debts;

đ) Penalty costs due to breach of contract;

e) Other costs as prescribed;

3. Costs for service activities outside public welfare tasks as prescribed:

- Salaries for individuals directly involved in service activities according to regulations;

- Raw materials, supplies, office supplies, tools, and equipment costs;

- Fixed asset depreciation costs as prescribed;

- Travel expenses, travel allowances as prescribed;

- Fixed asset rental costs (if applicable);

- Costs allocated for service activities outside public welfare tasks such as rent for premises and working locations, fixed asset depreciation costs, electricity, water, telephone, fax, internet, books, magazines, public services...

- Other expenses.

Article 17. Management of Costs

The Vietnam Vehicle Inspection Agency must strictly manage all cost items to reduce costs and increase profits through the following management measures:

1. Establishing, promulgating, and organizing the implementation of economic and technical norms that are suitable with the economic and technical characteristics, management models, and equipment levels of the Vietnam Vehicle Inspection Agency. These norms must be disseminated to all implementers and publicly announced to all employees of the Vietnam Vehicle Inspection Agency for implementation and supervision.

In cases where the norms cannot be implemented, leading to increased costs, the reasons and responsibilities must be clearly analyzed and handled according to the provisions of the law. If the cause is subjective, compensation for losses must be provided, and the Director of the Vietnam Vehicle Inspection Agency shall decide on the amount of compensation according to the law and bear responsibility for their decision.

2. Regularly organize cost analysis to identify weak and poor aspects in management and factors causing increased costs, and develop timely solutions to address them.

Article 18. Realized Profit

The realized profit of the Vietnam Vehicle Inspection Agency in a year is the difference between the total revenue specified in Article 15 and the total costs specified in Article 16 of this Circular. Specifically, it includes:

- The difference between revenue from inspection activities and the costs incurred for inspection activities during the period;

- The difference between income from other activities and the costs incurred for other activities during the period;

- The difference between revenue from service activities outside public interest inspection duties and the costs incurred for such service activities during the period.

IV. DISTRIBUTION OF PROFITS

Article 19. Distribution of Profits

After covering previous year's losses according to the Enterprise Income Tax Law and paying enterprise income tax, the realized profit of the Vietnam Vehicle Inspection Agency shall be distributed as follows:

1. Allocating 10% to the financial reserve fund; when the balance of the fund equals 25% of the State capital investment recorded in the Vietnam Vehicle Inspection Agency's financial report for the reporting period, no further allocation will be made;

2. Establishing two reward and welfare funds based on criteria evaluating the unit's performance results for the year, specifically as follows:

a) Allocating up to three months' actual salary to the two reward and welfare funds when the following conditions are met:

- Exceeding the plan for revenue from providing public service products set by the Ministry of Transport by 3% or more;

- Revenue and other income increase compared to the previous year;

- Profit on State capital is higher than the previous year;

- There is no overdue debt and the ability to pay maturing debts is greater than 1;

- No violation of current laws;

- The amount of budget payments generated in the year is equal to or higher than the previous year.

b) Allocating up to one and a half months' actual salary to the reward and welfare funds when the following conditions are met:

- Meeting or increasing but less than 3% compared to the plan for revenue from providing public service products set by the Ministry of Transport;

- Revenue and other income are equal to or decrease but not more than 3% compared to the previous year;

- Profit on State capital is equal to or lower than the previous year;

- There is no overdue debt and the ability to pay maturing debts is from 0.5 to 1;

- There is a conclusion from the competent authority regarding violations of current laws but not reaching the level of administrative penalties;

- The amount of budget payments generated in the year is lower than the previous year.

c) Allocating up to one month's actual salary for the remaining cases.

3. The entire remaining profit after establishing the funds shall be allocated to the Development Investment Fund of the Vietnam Vehicle Inspection Agency.

Article 20. Purpose of using the fund

1. The financial reserve fund shall be used for:

a) Compensating for losses and damages to assets and uncollectible debts arising during the business process;

b) Compensating for the unit's loss according to the decision of the Director of the Department or the Ministry of Transport.

2. The investment development fund shall be used for investing in fixed assets of the Vietnam Vehicle Inspection Agency, managed, utilized, and settled according to current regulations of the State.

3. The incentive fund shall be used for:

a) Year-end or regular bonuses based on labor productivity and work achievements of each staff member within the Vietnam Vehicle Inspection Agency;

b) Special bonuses for individuals and groups within the unit;

c) Bonuses for individuals and units outside the Vietnam Vehicle Inspection Agency that have made significant contributions to the unit's business operations and management tasks;

The amount of bonus stipulated at points a, b, and c of this clause shall be decided by the Director of the Vietnam Vehicle Inspection Agency. For point a, the opinion of the trade union of the unit must be obtained before making the decision.

4. The welfare fund shall be used for:

a) To invest in constructing or repairing welfare facilities of the Vietnam Vehicle Inspection Agency;

b) Spending on public welfare activities for the collective of workers and staff of the unit, social welfare;

c) To contribute part of the capital to invest in constructing common welfare facilities within the industry or with other units according to contracts;

d) Additionally, part of the welfare fund may be used to provide emergency assistance to employees, including those who have retired, become disabled, fallen into difficult circumstances without support, or engaged in charitable social work.

The use of the welfare fund shall be decided by the Director or the Unit Manager after consulting the opinion of the unit's trade union.

5. The use of the above funds must be carried out publicly in accordance with the expenditure regulation, financial transparency, grassroots democracy system, and State regulations.

V. FINANCIAL PLAN, ACCOUNTING SYSTEM, STATISTICS, AND AUDIT

Article 21. Financial Plan, Accounting System

1. Financial Plan:

a) Based on the actual implementation of the public service inspection tasks in the year and the plan to implement the tasks of the following year, the Vietnam Vehicle Inspection Agency has the responsibility to build a financial plan for the following year that is suitable for the actual situation of the unit and has the responsibility to send it to the Ministry of Transport and the Ministry of Finance before November 15 each year (Model of the Vietnam Vehicle Inspection Agency's Financial Plan according to Appendix No. 01 of this Circular).

b) Within seven working days from the date of receipt of the financial plan, the Ministry of Transport will send its comments to the Ministry of Finance. Within seven working days from the date of receipt of the request letter from the Ministry of Transport, the Ministry of Finance will send its comments in writing to the Ministry of Transport.

c) After receiving the comments from the Ministry of Finance, within seven working days, the Ministry of Transport will assign the financial plan to the Vietnam Vehicle Inspection Agency according to Appendix No. 02 of this Circular. The financial plan will be sent simultaneously to the Ministry of Finance for monitoring and supervision.

d) After being assigned the financial plan, within seven working days, the Vietnam Vehicle Inspection Agency will organize the annual financial plan assignment to subordinate units.

The financial plan above shall be sent directly or through postal service. The Ministry of Transport and the Vietnam Vehicle Inspection Agency must complete the assignment of the financial plan for the following year before December 31 each year.

2. Accounting System:

The Vietnam Vehicle Inspection Agency shall apply the accounting system of enterprises, accounting standards, and other current legal documents regarding accounting.

The Vietnam Vehicle Inspection Agency is an independent accounting entity; the Office of the Vietnam Vehicle Inspection Agency is the centralized management agency for all sources of capital and funds of the Vietnam Vehicle Inspection Agency. Subordinate units under the Vietnam Vehicle Inspection Agency are dependent accounting entities.

Article 22. Financial Report

1. At the end of each quarter and year, the Vietnam Vehicle Inspection Agency must prepare, present, and submit financial reports and statistical reports as prescribed by law. The Director of the Vietnam Vehicle Inspection Agency is responsible for the accuracy and truthfulness of these reports.

The annual financial report of the Vietnam Vehicle Inspection Agency must be audited by an independent auditing organization legally operating in Vietnam that has auditing functions.

2. The Vietnam Vehicle Inspection Agency shall be responsible for preparing and submitting the following reports:

a) Preparing the following reports:

- Quarterly and annual financial report (as prescribed in Decision No. 15/2006/QD-BTC dated March 20, 2006, of the Minister of Finance and supplemented with Form 2b-DN "Payments to the State Budget" according to Appendix No. 03 of this Circular);

- Report on the implementation of the financial plan according to Appendix No. 04 of this Circular.

- Public financial status report according to Appendix No. 05 of this Circular.

- Report on capital raising and utilization (if any) according to Appendix No. 06 of this Circular.

- Report on profit distribution after tax according to Appendix No. 07 of this Circular.

- Settlement report on salaries according to Appendix No. 08 of this Circular.

b) Time and place of submission of reports:

The Vietnam Vehicle Inspection Agency must submit the reports mentioned in point a, Clause 2 of this Article to the Ministry of Transport, the Ministry of Finance, and the Tax Authority of Hanoi City.

The time limit for submitting the above reports is once a year at the same time as the settlement report as prescribed. The quarterly report submission period follows the current regulations.

3. The Vietnam Vehicle Inspection Agency must organize and implement accounting and statistical work in accordance with the provisions of the law.

4. The Vietnam Vehicle Inspection Agency is subject to inspection, audit, and supervision by authorized financial agencies regarding the unit's financial work in accordance with the provisions of the law.

Article 23. Accounting inspection, examination, and verification of Financial Statements:

1. Monthly, quarterly, and annually, the Vietnam Vehicle Inspection Agency and its subordinate units are responsible for self-inspection of accounting and financial reports.

2. The Vietnam Vehicle Registration Agency shall be responsible for organizing the annual Financial Statement inspection for its subordinate units.

3. The Ministry of Transport takes the lead and coordinates with the Ministry of Finance:

a) Directly inspecting the annual Financial Statement of the Vietnam Vehicle Registration Agency Office;

b) Based on the annual Financial Statements of the Vietnam Vehicle Registration Agency Office and its subordinate units which have been audited and inspected, the Ministry of Transport and the Ministry of Finance shall verify the annual Financial Statement of the Vietnam Vehicle Registration Agency according to the following contents:

- The situation of management and utilization of capital and assets; results of production and business activities including fee and tax collection and other assigned revenues; relations with the State budget and profit distribution as prescribed by law;

- Reviewing the implementation of recommendations from competent state agencies through auditing, inspection, and verification of financial statements.

Upon completion of the verification of the annual Financial Statement, the Ministry of Transport will cooperate with the Ministry of Finance to prepare a verification record as the basis for the Ministry of Transport to issue a verification report on the annual Financial Statement.

4. When conducting year-end settlement verification, the Ministry of Transport and the Ministry of Finance have the right:

a) To request the Vietnam Vehicle Registration Agency to provide explanations or necessary information and data for the year-end settlement verification; if necessary, they may conduct inspections to support the verification process;

b) To request the Vietnam Vehicle Registration Agency to adjust the settlement figures if there are errors and to revise the settlement report based on the verification results;

c) To request the Vietnam Vehicle Registration Agency to instruct subordinate units to recover and remit to the State budget any expenditures made contrary to regulations and to settle other amounts due according to prescribed regulations;

5. Issuance of the verification report on the annual Financial Statement:

Based on the annual Financial Statement of the Vietnam Vehicle Registration Agency and the verification record of the annual Financial Statement, the Ministry of Transport shall issue a verification report on the annual Financial Statement to be sent to the Ministry of Finance as a basis for supervision, and to the Vietnam Vehicle Registration Agency as a basis for implementation.

Article 24. Publicizing Financial Statements:

Based on the annually approved Financial Statements, the Vietnam Vehicle Registration Agency and its subordinate units shall publicly announce them at the workers' and staff congress of the unit.

VI. IMPLEMENTATION

Article 25. Implementation organization

This Circular takes effect from February 15, 2012, and applies to the fiscal year 2010 until the end of 2013. Any previous provisions that conflict with this Circular are hereby abolished.

During the implementation process, any issues encountered should be promptly reported to the Ministry of Transport and the Ministry of Finance for appropriate resolution./.