Circular No. 75/2018/TT-BTC on the management regime and depreciation of infrastructure assets for transportation and water conservancy

CIRCULAR

Regulations on management and depreciation of infrastructure assets for transportation and irrigation
traffic, water conservancy

Pursuant to the Law on Management and Use of State Assets dated June 21, 2017;

Pursuant to Decree No. 129/2017/NĐ-CP dated November 16, 2017 of the Government stipulating the management, use, and exploitation of irrigation infrastructure assets;

Pursuant to Decree No. 43/2018/NĐ-CP dated March 13, 2018 of the Government stipulating the management, use, and exploitation of maritime infrastructure assets;

Pursuant to Decree No. 44/2018/NĐ-CP dated March 13, 2018 of the Government stipulating the management, use, and exploitation of civil aviation infrastructure assets;

Pursuant to Decree No. 45/2018/NĐ-CP dated March 13, 2018 of the Government stipulating the management, use, and exploitation of inland waterway infrastructure assets;

Pursuant to Decree No. 46/2018/NĐ-CP dated March 13, 2018 of the Government stipulating the management, use, and exploitation of railway infrastructure assets;

Pursuant to Decree No. 87/2017/NĐ-CP dated July 26, 2017 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

Based on the proposal of the Director of the State Asset Management Agency;

The Minister of Finance issues this Circular stipulating the management and depreciation regime for transportation and irrigation infrastructure assets.

PART I

GENERAL PROVISIONS

Article 1. This Circular stipulates the management and depreciation regime for civil aviation infrastructure assets, railway infrastructure assets, maritime infrastructure assets, inland waterway infrastructure assets, and irrigation infrastructure assets (hereinafter referred to as transportation and irrigation infrastructure assets).

Article 2. Infrastructure assets for transportation and irrigation that have been included in the state capital component at enterprises in accordance with the laws on the management and use of state capital invested in production and business activities at enterprises shall not be within the scope of regulation of this Circular.

Article 3. National administrative agencies responsible for transportation and irrigation, including: the Ministry of Transport, the Ministry of Agriculture and Rural Development; provincial people's committees (hereinafter referred to as provincial people's committees).

Article 4. Agencies entrusted with managing transportation and irrigation infrastructure assets (hereinafter referred to as agencies entrusted with managing assets).

Article 5. Agencies, units, and enterprises entrusted with using and exploiting transportation and irrigation infrastructure assets (hereinafter referred to as units entrusted with exploiting assets).

Article 6. Other entities related to the management, use, and exploitation of transportation and irrigation infrastructure assets.

 Chapter II

 SPECIFIC PROVISIONS

Clause 1. Transportation and irrigation infrastructure assets meeting the criteria for recording in accounting books are those assets with independent structures or systems consisting of multiple individual asset components interconnected to perform one or several specific functions, satisfying both of the following criteria simultaneously:

a) Having a service life of one year or more;

b) Having an original cost of ten million dong or more.

Clause 2. Transportation and irrigation infrastructure assets recorded in accounting books include:

a) Civil aviation infrastructure assets

- Runways;

- Taxiways;

- Parking aprons;

- Airfield service roads;

- Security fences;

- Other civil aviation infrastructure assets.

b) Railway infrastructure assets

- National railway tracks (mainline railways, stations), signals, bridges, culverts, tunnels, retaining walls, level crossings, fences separating national railways from roads;

- Stations (station buildings, railway tracks within stations, road sections within stations serving train operations, waiting rooms, warehouses and storage areas for goods transported directly by rail, control rooms, signal equipment rooms, canopy shelters, pedestrian overpasses within stations, guard posts);

- Depots (locations for train assembly, maintenance, repair, and other technical operations);

- Train operation control rooms at national railway traffic control centers;

- Water supply and drainage systems; signaling systems (transmission lines, radio stations, entry and exit station signals, control devices, command devices, signal cables, power sources); electricity systems directly related to train operations;

- Signal equipment houses, signal tower houses, bridge watch houses, tunnel watch houses, level crossing watch houses;

- Road sections within stations not serving train operations;

- Station squares;

- Warehouses and storage areas for goods not directly related to train operations;

- Service and commercial facilities (shops, lodging services, other services) at national railway stations;

- Office buildings of state agencies in station areas;

- Other railway infrastructure assets.

c) Maritime infrastructure assets

- Ports, mooring buoys;

- Cargo handling zones, anchorage zones, shelter zones within port waters;

- Headquarters, service facilities, warehouses, factories, and other auxiliary structures;

- Traffic information and communication systems, and electrical and water systems;

- Lighthouses and lighthouse stations;

- Buoys, beacons, and buoy management stations;

- Marine traffic monitoring and coordination systems;

- Breakwaters, sand barriers, flow direction revetments, shoreline protection revetments;

- Shipping channels;

- Marine telecommunications network infrastructure assets (structures, equipment directly serving the operations of the Vietnam Coastal Information System);

- Other maritime infrastructure assets.

d) Inland waterway infrastructure assets

- Navigation channels; berthing areas; structures allowing vessels to pass through dams, rapids on rivers, canals, or navigation channels on lakes, lagoons, bays, coastal inland waters, connecting islands, and linking islands within internal waters;

- Navigation channel protection zones;

- Inland waterway ports;

- Anchorage areas outside ports;

- Flood control levees;

- Inland waterway navigation aids;

- Ancillary works (inland waterway management stations; stations, AIS systems and accompanying management, monitoring, data transmission systems; water gauges or automatic water level reading stations; other ancillary structures and equipment);

- Other inland waterway infrastructure assets.

d) Water conservancy infrastructure assets

- Dams, reservoirs;

- Culverts, pumping stations;

- Riverbank protection works, flood control embankments;

- Canals, ditches, creeks, pipelines, sluices, tunnels, culverts used for water conveyance and transfer;

- Other water conservancy infrastructure assets.

1. All infrastructure assets for transportation and water conservancy must have asset records and be strictly managed in terms of physical condition and value in accordance with the provisions of laws on the management and use of state assets and related laws.

2. All infrastructure assets for transportation and water conservancy recorded in accounting books must contain complete information on original cost, remaining value, and accumulated depreciation.

3. For infrastructure assets for transportation and water conservancy that are not in use but awaiting liquidation but have not yet reached full depreciation, the agency entrusted with managing such assets shall continue to manage, monitor, and preserve them according to current regulations and calculate depreciation in accordance with this Circular.

4. For infrastructure assets for transportation and water conservancy that have reached full depreciation but are still in use, the agency entrusted with managing such assets shall continue to manage, monitor, and preserve them according to current regulations.

5. The agency entrusted with managing infrastructure assets for transportation and water conservancy shall be responsible for:

a) Establishing asset cards and accounting entries for all assets under its management in accordance with the current accounting system;

b) Conducting annual inventory checks on assets and reporting to the higher-level financial authority to unify the adjustment of figures between the inventory results and accounting books (if necessary);

c) Reporting on the management and use of infrastructure assets for transportation and water conservancy in accordance with the provisions of laws on the management and use of state assets and related laws;

d) Calculating depreciation for assets under its management in accordance with this Circular.

1. For infrastructure assets for transportation and water conservancy in use before the Government Decrees on the management, use, and exploitation of infrastructure assets for transportation and water conservancy come into effect, the determination of the original cost of assets shall be carried out as follows:

a) For infrastructure assets for transportation and water conservancy that already have information on original cost and remaining value of the asset, the existing value should be used for accounting records.

b) For infrastructure assets for transportation and water conservancy without information on asset value:

- In cases where there are equivalent assets (in terms of scale and technical level) with approved settlement values according to the law, the value of the equivalent asset should be used as the original cost of the asset.

- In cases where there are no equivalent assets, the estimated value determined by the Minister of Transport (for transportation infrastructure assets) or the Minister of Agriculture and Rural Development (for transportation and water conservancy infrastructure assets) should be used as the original cost of the asset. When declaring and entering information about this type of asset into the National Database on State Assets, it must clearly indicate that the original cost of the asset is an estimated value and should be monitored and reported separately. The estimated value is used to determine the asset value for accounting purposes and is not used to determine depreciation costs and amortization expenses as stipulated in Article 9 of this Circular.

2. For infrastructure assets for transportation and water conservancy completed and put into use from the date the Government Decrees on the management, use, and exploitation of infrastructure assets for transportation and water conservancy come into effect, the original cost of the asset recorded in the accounting book is the purchase value or the approved settlement value.

3. In cases where new infrastructure assets for transportation and water conservancy are constructed, completed, and put into use but have not yet been approved by the competent state authority, the provisional original cost should be used for accounting records. In this case, the provisional original cost should be selected in the following order of priority: proposed settlement value; value determined by the A-B Acceptance Certificate; budgeted project value that has been approved. When the settlement value is approved, the accounting agency must adjust the recorded value according to the law on accounting.

4. Change in the original cost of infrastructure assets for transportation and water conservancy

a) The original cost of infrastructure assets for transportation and water conservancy may be changed in the following cases:

- Revaluation of asset value according to the decision of the competent state authority;

- Implementation of upgrades, repairs, and expansions of assets according to projects approved by the competent state authority;

- Removal of one or more parts of the asset which are managed as separate tangible assets;

- Severe damage due to natural disasters, force majeure, or other sudden impacts requiring a reduction in the original cost according to the law.

b) When changes occur in the original cost of infrastructure assets for transportation and water conservancy, the agency entrusted with managing such assets shall establish a Record detailing the basis for changing the original cost, and simultaneously re-determine the original cost, remaining value, and accumulated depreciation of the asset to adjust the accounting books and perform accounting entries according to current regulations.

1. All transportation and irrigation infrastructure assets that are recorded in accounting books as prescribed in Article 3 of this Circular must be subject to depreciation, except for those specified in Clause 2 of this Article.

2. The following transportation and irrigation infrastructure assets shall not be subject to depreciation value calculation:

a) Assets that have not yet been fully depreciated but are damaged and cannot be used;

b) Assets that have been fully depreciated but are still usable;

c) Assets that are currently being leased by agencies or units;

d) Assets that are currently being held in custody by agencies or units.

3. Depreciation of transportation and irrigation infrastructure assets must be carried out according to the asset list, depreciation rate, and accounting period.

4. Depreciation shall be calculated once a year in December, before closing the accounting books. In cases where the depreciation period of an asset is six months or more, it shall be calculated for a full year; if the depreciation period is less than six months, no depreciation shall be calculated.

5. When transferring, dividing, merging, or dissolving agencies, organizations, or units, the calculation of depreciation of transportation and irrigation infrastructure assets shall be conducted at the receiving agency, organization, unit, or enterprise.

6. When inventorying and re-evaluating transportation and irrigation infrastructure assets based on decisions by competent authorities, the depreciation of assets shall be determined based on the re-evaluated value after inventory from the fiscal year designated by the competent authority.

1. The usage period and depreciation rate of transportation and irrigation infrastructure assets corresponding to each type of asset are stipulated in the Appendix attached to this Circular.

2. For other infrastructure assets not included in the list of assets specified in Clause 1 of this Article, the depreciation period and rate shall be implemented according to regulations on management and depreciation of fixed assets in state agencies, public service units, and organizations using state budget funds.

1. The annual depreciation rate of each transportation and irrigation infrastructure asset is calculated using the formula: Annual Depreciation Rate = Original Value of Asset x Depreciation Rate (%) / Year

2. Annually, based on determining the increase and decrease in depreciation arising in the year, the agency responsible for managing transportation and irrigation infrastructure assets calculates the total depreciation of all assigned infrastructure assets for that year using the formula: Depreciation of Transportation and Irrigation Infrastructure Assets up to Year (n) = Depreciation of Transportation and Irrigation Infrastructure Assets up to Year (n-1) + Increase in Depreciation of Transportation and Irrigation Infrastructure Assets in Year (n)

3. For transportation and irrigation infrastructure assets with changes in original value, the agency, unit, or enterprise responsible for managing such assets shall reassess the original value, remaining value, and cumulative depreciation of the asset to record in the accounting books.

4. The depreciation amount for the final year within the asset's usage period is determined as the difference between the original value of the transportation and irrigation infrastructure asset and the cumulative depreciation already performed on that asset.

Clause 1. The value of depreciation included in the initial auction price for leasing and transferring the right to exploit with a time limit of infrastructure assets for transportation and irrigation shall be determined in accordance with Clause 1 of Article 8 of this Circular.

Clause 2. Amortization costs included in the product and service prices of irrigation shall be determined according to the depreciation rate of corresponding assets as prescribed in this Circular, in accordance with the laws on irrigation.

Chapter III IMPLEMENTATION ORGANIZATION

The Ministry of Transport, the Ministry of Agriculture and Rural Development, provincial people's committees under the central government shall be responsible for directing and organizing the accounting work of infrastructure assets for transportation and irrigation in accordance with the provisions.

Clause 1. This Circular takes effect from October 3, 2018. The management system and depreciation of infrastructure assets for transportation and irrigation prescribed in this Circular shall apply from the 2019 fiscal year.

Clause 2. During the implementation of this Circular, if any difficulties arise, please report them to the Ministry of Finance for coordination in resolving them./.