Circular No. 98/2007/TT-BTC Amending and Supplementing Certain Points of Circular No. 33/2007/TT-BTC dated April 9, 2007 of the Ministry of Finance

1- Amend Point 5, Part I as follows:

"5- For projects with multiple sub-projects, depending on the scale, nature, and construction period of the project, the investor may settle the investment cost for each sub-project or the entire project immediately upon completion and commissioning of the sub-project or project according to the requirements of the investment decision maker. The proposed settlement value for each sub-project includes: construction costs, equipment costs, consulting fees, and other related costs directly associated with that sub-project. After the entire project is completed, the investor shall conduct a comprehensive settlement of the entire project and submit it to the competent authority for approval and allocation of common project costs to each sub-project within the project."

2-Amend Point 2, Section V, Part II as follows:

"2- The investor shall organize the selection of auditing firms in accordance with the laws on bidding and sign an audit settlement contract for completed projects in accordance with the laws on contracts."

3- Amend Point 2 (2.1.3), Section VI, Part II as follows:

"2.1.3 - Review of investment costs:

The investment costs of the project can be implemented through two methods:

- The investor (project management board) implements them independently;

- Contractors implement them under contracts.

a- Review of works implemented independently by the investor (project management board):

- Works implemented independently by the investor (project management board) include items of project management costs and packages of work that the investor is permitted to implement independently according to the laws on bidding.

- Review the contents and quantities in the proposed settlement value report of the investor against the acceptance certificate; compare unit prices in the proposed settlement value report of the investor with those in the approved budget estimate to ensure compliance with state norms or principles for establishing norms and unit prices as prescribed by the state. From this, determine the settlement value of the work or package implemented independently by the investor (project management board).

b- Review of works implemented by contractors under contracts:

Depending on the characteristics and nature of the project, construction works; for all types of contracts in construction activities; the parties signing the contract must agree on the contract price according to one of the following forms:

- Lump sum contract price;

- Fixed unit price contract;

- Adjustable price contract;

- Combined form of the three above price types.

* b.1- Review for contracts under the "Lump Sum Contract Price" form (regardless of the method of selecting contractors):

- Compare the requirements, contents, quantities executed, and unit prices in the proposed settlement value report A-B with those in the contract, the contract price calculation, and accompanying documents. From this, determine the settlement value of the contract.

- When the contractor fully meets the requirements, contents, quantities executed, and unit prices specified in the contract and the contract price calculation, the settlement value equals the lump sum contract price signed. There is no need to re-calculate the quantities or detailed unit prices already approved by the competent authority according to the winning bid decision.

* b.2- Review for contracts under the "Fixed Unit Price Contract" form (regardless of the method of selecting contractors):

- Compare with the quantity acceptance certificate to review the requirements, contents, quantities executed in the proposed settlement value report A-B; compare unit prices in the proposed settlement value report A-B with those fixed in the contract price calculation and accompanying documents; the settlement value equals the accepted quantities multiplied by the fixed unit price in the contract.

* b.3- Review for contracts under the "Adjustable Price Contract" form (regardless of the method of selecting contractors):

- Based on the specific conditions of the contract, clearly define the scope and method of adjustment of the contract. In cases of adjustment regarding quantities, refer to the quantity acceptance certificate for review of quantities. In cases of adjustment regarding unit prices, refer to the principles of unit price adjustment stipulated in the contract.

* b.4- Review for contracts under the "Combined Form" (regardless of the method of selecting contractors):

- Contracts under the "Combined Form" must clearly specify the scope of application of specific contract forms: lump sum, fixed unit price, or adjustable price, for specific works, sub-works, or contents. The review of each part of the contract, according to each contract form, corresponds to the provisions in cases b.1, b.2, and b.3 above.

c- Review of exceptional cases:

* Exceptional cases within the scope of the contract:

- If certain items or some contents of work in the contract are not implemented, deduct the corresponding values of these contents according to the contract.

- If there is unexecuted quantity or the accepted quantity is lower than the contract quantity, deduct the unexecuted quantity (or lower) multiplied by the corresponding unit price specified in the contract.

- In case there is work generated at the request of the investor within the scope of the contract, where the additional volume of work is less than or equal to 20% of the corresponding work volume recorded in the contract, the additional accepted volume shall be added and multiplied by (x) with the corresponding unit price recorded in the contract.

- In case there is work generated at the request of the investor within the scope of the contract, where the additional volume of work exceeds 20% of the corresponding work volume recorded in the contract or the additional volume of work does not have a unit price in the contract, the additional accepted volume shall be added and multiplied by (x) with the adjusted unit price approved by the investor according to the principle for adjusting the unit price of the additional work volume recorded in the contract.

* In case there is work generated at the request of the investor outside the scope of the contract, it shall be reviewed according to the supplementary budget approved by the investor along with the supplementary contract for this additional value.

d- The selection of contract forms, adjustment of contract prices, and adjustment of unit prices in construction contracts must comply with the provisions of Decree No. 99/2007/NĐ-CP dated June 13, 2007, of the Government on managing investment construction costs. For projects using state budget funds, they must also comply with the contract forms, conditions for adjusting contract prices, and adjustments to unit prices in contracts as stipulated in the decision of the competent authority responsible for investment decisions.

4- Amend Point 2 (2.1) Section VIII, Part II as follows:

"2.1- For projects from Group B onwards: The head of the leading unit shall review the final settlement budget based on the current national regulations on expenditure systems, standards, and quotas, and approve the final settlement budget according to the contents specified in Point 2 (2.3) Section VIII, Part II, Circular No. 33/2007/TT-BTC, together with the payment application sent to the investor. The investor and the payment agency shall make payments according to the approved budget."

5- Amend Point 2 Section XI, Part II as follows:

"2- Inspection regime:"

- Financial agencies at all levels: Regularly or unexpectedly inspect the final settlement work of projects funded by the state budget of units under their management; promptly correct errors and handle violations according to regulations.

- Ministry of Finance: Regularly or unexpectedly inspect the final settlement work of important national projects and projects funded by the state budget nationwide; promptly correct errors and handle violations according to regulations.

6- Replace the phrase "Accounting Officer" at the end of Form No. 08/QTDA with the phrase "Department Head".

7- Effective date: This Circular takes effect fifteen days after its publication in the Official Gazette.

8- Transitional provisions: Contracts that have been completed and accepted before the effective date of this Circular; if the contract does not clearly specify the form of contract price as stipulated in Point 3 of this Circular, the review method according to the guidance circulars for final settlement prior to this Circular shall be applied, ensuring compatibility with the contract execution period and the national regulations on contracts.