Circular No. 78/2004/TT-BTC guides the management of capital withdrawal from Official Development Assistance (ODA) sources.

CIRCULAR

Guidelines for managing the withdrawal of capital from Official Development Assistance (ODA) sources

 Official Development Assistance (ODA)

- Based on Decree No. 17/2001/NĐ-CP dated May 4, 2001 of the Government promulgating the Regulations on management and use of Official Development Assistance (ODA) sources;

- Based on Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government detailing and guiding the implementation of the State Budget Law;

- Based on Decree No. 77/2003/CP-NĐ dated July 1, 2003 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

The Ministry of Finance provides detailed guidelines on the procedures and formalities for withdrawing ODA capital as follows:

Part I.

GENERAL PROVISIONS

I. SCOPE OF APPLICATION:

1. These Circular applies to the management of capital withdrawal and related financial issues concerning the withdrawal of ODA loan and ODA assistance in the form of co-financing in ODA loan programs/projects; or independent assistance programs/projects with withdrawal methods consistent with this Circular. Counterpart capital withdrawal shall be carried out according to the procedures and formalities prescribed in current documents.

2. For ODA programs/projects with specific characteristics, the Ministry of Finance may issue specific guidelines based on management requirements.

3. In cases where certain non-reimbursable aid projects must apply the method of direct management and implementation by the donor as stipulated in the Agreement/supplementary document on aid, such provisions shall be followed.

4. As for grants provided in the form of trust funds managed by the government, the Ministry of Finance will issue separate guidelines.

II. TERMINOLOGY EXPLANATION:

In this Circular, some terms and phrases are understood as follows:

1. "Program/project" refers to programs/projects using ODA capital.

2. "Program/project owner" is the organization entrusted with the direct responsibility for managing and utilizing ODA capital and counterpart capital to implement the program/project according to the approved content.

3. "Program/project Management Board" (hereinafter referred to as Project Management Board) is the agency representing the Project Owner, having full authority to act on behalf of the Project Owner to carry out assigned rights and duties from the start until the completion of the project, including final settlement, acceptance, handover for operation and use, and conducting withdrawal transactions and payments from program/project funds.

4. "Service bank" is a commercial bank selected in accordance with current regulations or through an agreement between the government and the donor in international treaties to serve the program/project in opening transaction accounts, handling foreign capital withdrawal procedures (if applicable), and conducting payment transactions.

5. "Expenditure control agency" is:

- National Treasury at various levels (based on the level of implementation for each program/project) responsible for controlling expenditure activities of the program/project (i) funded by the state budget or parts funded by the state budget within credit programs/projects (if any); and (ii) non-credit components within credit programs/projects.

- Development Support Fund controls expenditures of programs/projects funded by the state budget through loans made by the Development Support Fund under the authority of the Ministry of Finance.

- Projects with both components funded by the state budget and components loaned by the state budget implemented by the same Project Management Board: The Ministry of Finance determines the expenditure control agency based on the nature of the project, ensuring that there are no two agencies controlling the same activity of the program/project simultaneously.

6. "Financial plan" is the investment capital plan (for construction projects) or annual budget estimate (for administrative and public service projects) to implement the program/project, including ODA capital (foreign funding) and counterpart capital (domestic funding).

III. MANAGEMENT PRINCIPLES:

1. ODA capital for investment in programs/projects is part of the state budget, must be fully recorded in the budget, and managed in accordance with the State Budget Law and current guiding documents.

2. The Ministry of Finance performs the function of state financial management for the withdrawal and payment of capital for programs/projects, records state budget revenue and expenditure for ODA capital, guides and supervises the implementation of financial management systems, audits projects, and guides and supervises units in transferring assets, materials, and capital when the project ends.

3. The program/project owner is primarily responsible under the law for implementing programs/projects in accordance with commitments stipulated in international treaties, strictly adhering to state regulations on program/project implementation, financial management, accounting, auditing, and settlement in accordance with current state regulations.

4. Depending on the specific nature of each program/project (construction investment project, administrative and public service project, mixed project with both construction and administrative and public service components, credit project...), corresponding management procedures regarding financial planning, expenditure control, payment, accounting, and settlement shall be applied in accordance with current regulations.

IV. FINANCIAL PLAN

1. The financial plan of the program/project approved by the competent authority serves as the basis for controlling capital withdrawal for the program/project. After the financial plan is approved, the Project Management Board sends the financial plan to the Ministry of Finance (Department of Foreign Financial Affairs) and the Expenditure Control Agency.

2. The preparation of the financial plan for programs/projects is carried out in accordance with Joint Circular No. 02/2003/TTLT-BKH-BTC dated March 17, 2003 of the Ministry of Planning and Investment and the Ministry of Finance guiding the preparation of financial plans for programs/projects using ODA capital.

V. SERVICE BANK AND ACCOUNTS

1. Accounts:

1.1. The project management board shall manage the account opening for transaction accounts at the bank in accordance with current regulations. For projects with advance payment accounts/special accounts where the agreement with the financier stipulates that the project management board is the account holder, the project management board shall open these accounts at the serving bank and notify the Ministry of Finance (Department of Foreign Financial Affairs) and the Expenditure Control Agency of the details of the accounts.

1.2. Special accounts/advance payment accounts shall earn interest on accrued interest at the rate agreed upon between the serving bank and the account holder. Accrued interest on these accounts constitutes revenue for the State budget for programs and projects funded by the State budget; and is revenue for the Project Owner for programs and projects refinanced by the State budget.

1.3. For mixed programs and projects having both components funded by the State budget and components refinanced by the State budget using the same special account/advance payment account (the time when the State budget refinances is the time when funds are withdrawn from the special account/advance payment account), accrued interest on the account is revenue for the State budget.

2. Responsibilities of the Serving Bank

2.1. The serving bank shall implement the opening of relevant accounts for the project at the request of the project management board, carry out transactions and fund withdrawals according to the request of the project management board, based on current regulations.

2.2. Monthly and upon request by the account holder, the serving bank shall notify the account holder and the Department of Finance of the accrued interest on special accounts/advance payment accounts of programs and projects; service fees collected by the serving bank; the difference between interest and fees; beginning and ending balances.

2.3. Within two working days from receiving notice of funds withdrawn from the financier, the serving bank shall report the deposit to the account holder.

2.4. Annually, within six months from the end of the fiscal year, the serving bank shall transfer to the Ministry of Finance the remaining accrued interest on special accounts/advance payment accounts of programs and projects funded by the State budget, after deducting service fees, and notify the Ministry of Finance.

3. Banking Fees:

3.1. The serving bank shall be entitled to charge fees in accordance with current regulations on service fee collection for services provided to programs and projects.

3.2. Banking service fees shall be recorded as part of the total costs of programs and projects.

Part II.

SPECIFIC PROVISIONS

A. WITHDRAWAL PROCEDURES

I. EXPENDITURE CONTROL

1. Principles of expenditure control:

1.1. Expenditure control applies to all expenditures of programs and projects, except in cases of payment through letters of credit (L/C) or direct payment through irrevocable payment authorization letters in bilateral aid projects. In these cases, the control of payment documentation is carried out by the bank issuing the L/C (or the advising bank), or the agency bank/or another organization authorized by the financier (see provisions in Part II, Section A, Subsection III, Points 3.3 and 3.5).

1.2. Expenditure control aims to ensure that expenditures of programs and projects are in compliance with the Agreement/Project Documentation (legitimate spending, legitimate procurement methods, correct funding ratio according to the Agreement, validly signed and approved contracts, ensuring pre-audit by the financier if applicable), and current domestic financial management regulations.

1.3. Expenditure control for ODA funds may not be limited by the financial plan of the program or project in the following cases:

- Programs and projects without an approved financial plan but have a letter from the managing authority sent to the Ministry of Finance and the Expenditure Control Agency, committing to approve the financial plan for the program/project within two (02) months from the date of issuance of the letter.

- Programs and projects withdrawing funds exceeding the approved financial plan but have a letter from the managing authority committing to supplement the capital plan for the program/project. Within three (03) months from the date of expenditure control outside the approved financial plan, the program/project must complete procedures for building and approving a supplementary financial plan.

2. Expenditure Control Documentation

2.1. Documentation and procedures for expenditure control for construction projects or construction cost components in mixed projects: implemented in accordance with Circular 44/2003/TT-BTC dated May 15, 2003, issued by the Ministry of Finance guiding the management and settlement of investment capital and investment-type public expenditure capital from state budget sources or other amended, supplemented, or replaced circulars.

2.2. Documentation and procedures for expenditure control for administrative and public service projects or administrative and public service cost components in mixed projects: implemented in accordance with Circular 79/2003/TT-BTC dated August 13, 2003, issued by the Ministry of Finance guiding the management, allocation, and settlement of state budget expenditures through the State Treasury and other amended, supplemented, or replaced circulars.

2.3. Documentation and procedures for expenditure control for lending components of programs and projects are based on the loan statement of the refinancing credit institution sent to the Ministry of Finance (summary loan statement, not detailed expenditure statement). The refinancing credit institution is responsible under the law for the accuracy and validity of the statement sent to the Ministry of Finance.

3. Confirmation of Expenditure Control

3.1. After expenditure control, the Expenditure Control Agency shall confirm on the payment invoice/payment summary/temporary advance request form (collectively referred to as the Payment Invoice).

3.2. The Payment Invoice with confirmation (original) from the Expenditure Control Agency serves as the basis for withdrawing ODA funds from the financier.

3.3. The amount of ODA funds requested for withdrawal from the financier must match the amount of foreign source funds confirmed by the Expenditure Control Agency on the Payment Invoice. Each Payment Invoice can only be used once for expenditure control.

4. Post-Expenditure Control

4.1. Post-expenditure control is the process where the Expenditure Control Agency checks and confirms the legitimacy of expenditures after the project management board has withdrawn funds for payment to beneficiaries.

4.2. Post-expenditure control applies in the following situations:

- Payment from Special Account/Advance Account for expenditures at the level directly managing the Special Account/Advance Account based on a written opinion of the Program/Project Manager approving post-payment control.

- Transfer payment when implementing programs/projects funded by JBIC, except for the final payment for all contracts, or for contracts that are paid only once, pre-payment control must be applied.

- Direct payment in government loan projects, except for the final payment for all contracts, or for contracts that are paid only once, pre-payment control must be applied.

4.3. Post-payment control process:

- When there is a need for payment, the Project Management Board: (i) requests the bank to withdraw funds from the Special Account/Advance Account (for payment through the Special Account/Advance Account); or (ii) signs/requests the Ministry of Finance to sign a withdrawal request sent to the sponsor (for direct payment, transfer payment) to pay the contractor/supplier/advisor based on volume and valid documentation.

- Within five working days after payment from the Special Account/Advance Account; or after sending the withdrawal request for direct payment, transfer payment to the sponsor, the Project Management Board sends the payment file to the expenditure control agency to implement post-payment control. The post-payment control file is implemented according to the provisions in Part II, Section A, Item I, Point 2.

- Within five working days from receiving complete valid files, the Expenditure Control Agency provides an opinion on post-payment control (confirmation/rejection of confirmation), and simultaneously pays the counterpart capital (if the project or corresponding component is eligible for counterpart grant/loan).

- The payment voucher with the confirmation of the Expenditure Control Agency (original) serves as the basis for the Project Management Board to request subsequent withdrawals from the sponsor. The Ministry of Finance may refuse to withdraw subsequent payments for the program/project if it finds that the program/project does not comply with the regulations on post-payment control confirmation by the Expenditure Control Agency.

5. Pre-payment control:

5.1. Pre-payment control is the action of the Expenditure Control Agency checking and confirming the legitimacy of the expenditure before the Project Management Board withdraws funds for payment to the beneficiary.

5.2. Pre-payment control applies in all cases where the post-payment control method specified in Part II, Section A, Item I, Point 4.2 is not applicable, specifically as follows:

- Direct payment (except for direct payment, transfer payment as stipulated in Part II, Section A, Item I, Point 4.2 above).

- Retroactive payment.

- Payment/advance for expenditures at the implementation level of the project that does not directly manage the Special Account/Advance Account.

- Payment/advance for expenditures at the implementation level of the project that directly manages the Special Account/Advance Account, upon written request of the Program/Project Manager to apply pre-payment control.

- Final payment for all contracts, or for contracts that are paid only once (including payments from the Special Account/Advance Account).

- Other cases.

5.3. Pre-payment control process:

- When there is a need for payment, the Project Management Board prepares the Expenditure Control File and sends it to the Expenditure Control Agency requesting pre-payment control.

- The Expenditure Control File is implemented according to the provisions in Part II, Item A, Section I, Point 2.

- Within five working days, the Expenditure Control Agency checks the file, confirms the foreign capital eligible for payment, and pays the counterpart capital (if the project or corresponding component is eligible for counterpart grant/loan).

- Based on the expenditure confirmed by the Expenditure Control Agency as eligible for payment, the Project Management Board issues a payment order to the serving bank along with the payment voucher with the confirmation (original) of the Expenditure Control Agency to pay the beneficiary.

- In cases where the Project Management Board does not directly manage the Special Account/Advance Account, the subordinate Project Management Board sends a payment request to the superior Project Management Board, accompanied by the payment voucher with the confirmation (original) of the Expenditure Control Agency at the same level for the superior Project Management Board to proceed with withdrawing funds from the Special Account/Advance Account or from the sponsor for the beneficiary.

- The serving bank will only withdraw funds from the Special Account/Advance Account when the payment request from the Project Management Board for the beneficiary is accompanied by the payment voucher with the confirmation (original) of the Expenditure Control Agency.

II. WITHDRAWAL OF ODA FUNDS FOR FAST DISBURSEMENT IN CASH

1.1. For ODA funding provided under budget support programs, fast disbursement in cash to implement reform tasks committed by the Government to sponsors, the ODA program management agency implements and coordinates the fulfillment of the conditions for fund withdrawal already committed; collaborates with the Ministry of Finance to withdraw ODA funds based on the Prime Minister's directives and the State Budget's capital usage needs during each period.

1.2. The Ministry of Finance is the agency signing/jointly signing withdrawal requests for program loans. For program loans from the World Bank, Asian Development Bank, the State Bank signs the withdrawal request after reaching a consensus with the Ministry of Finance.

III. WITHDRAWAL OF ODA FUNDS FOR PROJECTS

1. Depending on the provisions in international treaties/documents, the withdrawal and payment of ODA funds through project financing methods are carried out through one or several common methods: direct payment withdrawal, payment withdrawal through commitment letters, repayment withdrawal, retroactive payment, payment through special accounts/temporary accounts, and other special withdrawal methods agreed with sponsors.

2. Initial withdrawal file: The Project Management Board submits the initial file as the basis for managing ODA fund withdrawal to the Ministry of Finance (Department of Foreign Financial Affairs). The file includes the following documents:

- Investment decision by the competent authority;

- International treaty on ODA signed between Vietnam and the sponsor and related project documents;

- Financial plan assigned by the competent authority.

- Agreement on rescheduling signed between the project sponsor and the authorized rescheduling agency (if applicable for rescheduled projects);

- Decision of the competent authority recognizing the successful bidder (or decision to appoint the bidder) and/or decision of the competent authority approving the contract signed with the contractor (if any);

- Contract (construction, procurement, consulting, etc...) between the project sponsor and the contractor or approved budget expenditure plan (if the expenditure activity does not follow the form of a contract);

- In cases where the contract requires prior consent from the financier, an additional "no objection" opinion of the financier is required;

- Bank guarantee for performance issued by the contractor's bank;

- Advance payment guarantee (for advance payment settlement);

The Project Management Board only needs to submit the above documents once for the entire project, except for the annual investment capital plan/financial plan which must be submitted annually. Copies of these documents are sufficient. The Project Management Board is responsible under the law for the authenticity of the copies provided to the Ministry of Finance.

3. Withdrawal procedures:

(See diagram describing withdrawal procedures in Appendix 1)

3.1. Withdrawal request and withdrawal documentation attached to the Withdrawal Request (collectively referred to as the Withdrawal Request): The Withdrawal Request is prepared and signed by the Project Management Board before submission to the Ministry of Finance (Department of Foreign Financial Affairs). The Project Management Board is legally responsible for the legality and authenticity of the Withdrawal Request.

3.2. Direct Payment/Settlement Procedure:

3.2.1. When there is a need to withdraw funds for direct payment/settlement, the Project Management Board sends the following documents to the Ministry of Finance (Department of Foreign Financial Affairs):

- Letter requesting withdrawal accompanied by the Withdrawal Request and relevant statements as prescribed by the financier;

- Invoice/payment proposal from the contractor;

- Payment voucher with confirmation (original) from the Expenditure Control Agency for cases applying pre-expenditure control procedures; or Payment voucher with confirmation (original) from the Expenditure Control Agency for direct payments/settlements made previously in cases applying post-expenditure control procedures.

- In special cases, the Ministry of Finance may require the Project Management Board to provide additional documents proving the legitimacy of the withdrawal;

3.2.2. Within five working days from receiving complete and valid documents, the Ministry of Finance (Department of Foreign Financial Affairs) will examine and sign/co-sign the Withdrawal Request sent to the financier.

- For projects financed by the World Bank (WB) and Asian Development Bank (ADB), within five working days from receiving complete and valid documents, the Ministry of Finance (Department of Foreign Financial Affairs) will issue a written opinion to the Project Management Board and the servicing bank. Within two working days, based on the approval of the Ministry of Finance, the Project Management Board and the servicing bank will sign the Withdrawal Request and send it to the financier.

3.2.3. If the financier accepts the withdrawal request, they will directly transfer the funds into the contractor's account. For JBIC projects, the payment will be transferred through the servicing bank.

3.3. Direct Payment Procedure pursuant to Non-Cancellable Withdrawal Authorization Letter (applicable in some bilateral financing projects, typically for equipment purchase contracts):

Based on the commercial contract signed and approved according to current regulations, the Project Management Board submits a letter requesting withdrawal and related documentation to the Ministry of Finance (Department of Foreign Financial Affairs).

Within five working days from receiving complete and valid documents, the Ministry of Finance (Department of Foreign Financial Affairs) will examine and issue a Non-Cancellable Withdrawal Authorization Letter to the agency authorized by the financier to manage withdrawals for payment to the contractor/supplier/advisor under the contract.

3.4. Guarantee Commitment Procedure

- When there is a need to withdraw funds for payment under this procedure, the Project Management Board sends the Ministry of Finance a request for issuance of a guarantee commitment (Withdrawal Request), along with relevant statements as prescribed by the financier (for JBIC projects, the Withdrawal Request and statements do not need to be submitted), and draft L/C (or copy of the opened L/C).

- Within five working days from receiving complete and valid documents, the Ministry of Finance will examine and sign/co-sign the Withdrawal Request requesting the financier to issue a guarantee commitment and notify the servicing bank.

- For projects financed by the World Bank (WB) and Asian Development Bank (ADB), within five working days from receiving complete and valid documents, the Ministry of Finance (Department of Foreign Financial Affairs) will issue a written opinion to the Project Management Board and the servicing bank. Within two working days, based on the approval of the Ministry of Finance, the Project Management Board and the servicing bank will sign the Withdrawal Request requesting issuance of a guarantee commitment and send it to the financier.

3.5. Payment Procedure via L/C without Guarantee Commitment (applicable in certain cases where the bilateral financier authorizes a bank to manage withdrawals on its behalf while also acting as the seller's bank):

- When there is a need to make payments under this procedure, the Project Management Board sends the Ministry of Finance (Department of Foreign Financial Affairs) a letter requesting issuance of an L/C and related documentation.

- Within five working days from receiving complete and valid documents, the Ministry of Finance will examine and issue an opinion on the issuance of the L/C to the Project Management Board and the servicing bank, and send a Notice of Non-Cancellable Authorization to Pay to the financier for payment under the L/C.

3.6. Refund/Reimbursement Procedures

3.6.1. Withdrawal procedure pursuant to refund: applicable when paying for expenditures that have been advanced by the Borrower/Recipient from other sources of the Borrower, after the Loan/Grant Agreement becomes effective.

3.6.2. Withdrawal procedure pursuant to reimbursement: applicable for payments for costs incurred before the Loan/Grant Agreement becomes effective.

3.6.3. When there is a need to withdraw funds for payment under this procedure, the Project Management Board sends the Ministry of Finance (Department of Foreign Financial Affairs) the following documents:

- Withdrawal request, Withdrawal Request form, and relevant statements;

- Confirmation of receipt of payment from the contractor/beneficiary.

In the Withdrawal Request, the name and account number of each entity that has received advances must be clearly stated. For advances paid from the State Budget, the name and account number of the State Budget level providing the advance must be specified. The name and account number of the entity providing the advance must be confirmed by the Expenditure Control Agency.

- Payment voucher with confirmation (original) of the Expenditure Control Agency;

- In special cases, the Ministry of Finance may request additional explanatory documents;

3.6.4. Within five working days from the date of receipt of a complete set of valid documents, the Ministry of Finance shall examine and sign/approve the Withdrawal Request Form sent to the sponsor;

- For projects financed by the World Bank (WB) and Asian Development Bank (ADB), within five working days from receiving complete and valid documents, the Ministry of Finance (Department of Foreign Financial Affairs) will issue a written opinion to the Project Management Board and the servicing bank. Within two working days, based on the approval of the Ministry of Finance, the Project Management Board and the servicing bank will sign the Withdrawal Request and send it to the financier.

3.6.5. For withdrawals for repayment/reimbursement to state budgets at all levels where funds were advanced (or from sources with budget origin), the withdrawn amount must be immediately remitted back to the budget where the advance was made;

3.7. Special Account/Advance Account Procedures

3.7.1. First withdrawal to Special Account/Advance Account

- The first withdrawal to the Special Account/Advance Account shall be based on the limit (or ceiling) specified in the Loan Agreement/Aid Agreement. For ODA projects under the State Budget allocation, the Ministry of Finance may refuse a full 100% withdrawal based on a consideration of: actual expenditure needs of the project over the next three months, foreign interest payment costs, and interest generated by the Serving Bank;

- To withdraw funds, the Project Management Board sends to the Ministry of Finance (Department of Foreign Financial Affairs) a letter requesting withdrawal, the Withdrawal Request Form, and accompanying bank statements according to the sponsor's model;

- Within five working days from the date of receipt of a complete set of valid documents, based on signed international agreements, the Ministry of Finance (Department of Foreign Financial Affairs) will examine and sign/approve the Withdrawal Request Form sent to the sponsor;

- For projects financed by the World Bank (WB) and Asian Development Bank (ADB), within five working days from receiving complete and valid documents, the Ministry of Finance (Department of Foreign Financial Affairs) will issue a written opinion to the Project Management Board and the servicing bank. Within two working days, based on the approval of the Ministry of Finance, the Project Management Board and the servicing bank will sign the Withdrawal Request and send it to the financier.

3.7.2. Supplementing the Special Account/Advance Account

To supplement the Special Account/Advance Account, the Project Management Board sends the following documents to the Ministry of Finance (Department of Foreign Financial Affairs):

- A letter requesting supplementary withdrawal from the Special Account/Advance Account, the Withdrawal Request Form, and bank statements according to the sponsor's model;

- A statement prepared by the Project Management Board detailing each expenditure from the Special Account/Advance Account, itemized by: payment date, original currency amount, equivalent USD amount, VND amount, USD/VND exchange rate, payment purpose, beneficiary, expenditure control area, branch of the Expenditure Control Agency, confirmation number/date of the Expenditure Control Agency for each expenditure. This statement serves as the basis for the Ministry of Finance to record income and expenditure (or reduce income/reduce expenditure if applicable) in the State Budget for amounts already used for the project;

- Payment vouchers with confirmation (original) of the Expenditure Control Agency. Payments listed on the statement must match the confirmed amount by the Expenditure Control Agency on the Payment Voucher. Each Payment Voucher with confirmation can only be used once; for credit projects, the statement must show the amounts re-lent. The Ministry of Finance may require detailed documentation proving the re-lending (if necessary);

- A statement of the Special Account/Advance Account of the Serving Bank, showing all transactions on the account during the period requested for supplementary withdrawal for expenditures incurred;

- Promissory note signed between the Project Management Board and the Re-lending Agency (in the case of re-lending projects);

Within five working days from the date of receipt of a complete set of valid documents, the Ministry of Finance (Department of Foreign Financial Affairs) will examine and sign/approve the Withdrawal Request Form sent to the sponsor;

- For projects financed by the World Bank (WB) and Asian Development Bank (ADB), within five working days from receiving complete and valid documents, the Ministry of Finance (Department of Foreign Financial Affairs) will issue a written opinion to the Project Management Board and the servicing bank. Within two working days, based on the approval of the Ministry of Finance, the Project Management Board and the servicing bank will sign the Withdrawal Request and send it to the financier.

3.8. Withdrawal from the JBIC Project Special Account

Withdrawals from the Special Account in JBIC projects are carried out in accordance with Circular No. 129/1999/TT-BTC dated November 5, 1999, issued by the Ministry of Finance guiding the management mechanism for loans for specialized credit programs;

B. REPORTING, AUDITING, ACCOUNTING, SETTLEMENT

I. REPORTS

1. Quarterly, the Project Management Board is responsible for preparing statements of amounts withdrawn by sponsors according to each withdrawal method, detailed by source of funding, beneficiary, expenditure control agency, location of account opening for sub-programs/projects, and sending them to the Ministry of Finance (Department of Foreign Financial Affairs) and the Expenditure Control Agency. These reports serve as the basis for accounting and reconciling income-expenditure records in the State Budget for programs and projects;

2. Monthly, the Expenditure Control Agency prepares statements of amounts confirmed as eligible for payment, detailed by confirmed amount, activity, source of funding, beneficiary, and funding area, and sends them to the Ministry of Finance (Department of Foreign Financial Affairs, State Budget) to process accounting income-expenditure procedures for ODA programs and projects;

II. INSPECTION

The Ministry of Finance conducts regular and surprise inspections of organizations and units using ODA funds, particularly inspecting the use of Special Accounts/Advance Accounts of programs and projects;

III. AUDIT

1. The Ministry of Finance will issue separate guidelines on audit frameworks for ODA programs and projects;

2. The Project Management Board selects an auditing company through bidding or direct assignment according to the agreement/project document and current domestic regulations. The audit framework, decision on selecting the auditing company, and audit contract must comply with the agreement/project document and be approved according to current national regulations;

3. The audit report must be submitted to the Ministry of Finance no later than fifteen days after completion;

IV. SETTLEMENT

The Project Leader directs the Project Management Boards to prepare implementation reports on investment capital plans or administrative and public service expenditure settlement quarterly/yearly for ODA programs and projects, and to submit final settlement reports for completed works according to current regulations.

Part III.

IMPLEMENTATION

This Circular shall take effect fifteen days after its publication in the Official Gazette. Previous provisions contrary to this Circular shall cease to be effective.