Decision No. 995-TC/QD/TCDN amending and supplementing the "Financial Regulation Model for State-Owned Joint Stock Companies" issued together with Decision No. 838-TC/QD-TCDN dated August 28, 1996.

Pursuant to …;

REGARDING AMENDMENTS AND SUPPLEMENTS TO THE "MODEL FINANCIAL REGULATIONS OF STATE ENTERPRISE GROUPS" ISSUED ACCOMPANYING DECISION NO. 838 TC/QĐ-TCDN ON AUGUST 28, 1996

THE MINISTER OF FINANCE

Pursuant to the Law on State-Owned Enterprises dated April 30, 1995;
Pursuant to Decree No. 15/CP dated March 2, 1993 of the Government stipulating the tasks, powers, and responsibilities for state management of Ministries and ministerial-level agencies;
Pursuant to the Prime Minister's Decision No. 853/1997/CT-TTg dated October 11, 1997 on combating smuggling under new circumstances;
Pursuant to Decree No. 39/CP dated June 27, 1995 of the Government on the issuance of model regulations on organization and operation of State Enterprise Groups;
Pursuant to Decree No. 59/CP dated October 3, 1996 of the Government on financial management and accounting regulations for state-owned enterprises;

Pursuant to …;

Article 1.

Amend and supplement certain provisions of the "Model Financial Regulations of State Enterprise Groups" issued accompanying Decision No. 838 TC/QĐ/TCDN dated September 28, 1996 of the Minister of Finance according to the attached document "Regulations on Amendments and Supplements to the Model Financial Regulations of State Enterprise Groups."

Article 2.

This Decision takes effect from the date of signing; all previous regulations contrary to this Decision shall be abolished.

Article 3.

The Director of the Ministry of Finance's Office, the General Director of the State Capital and Asset Management Agency at Enterprises, the Chairman of the Board of Directors, and the General Director of State Enterprise Groups are responsible for implementing this Decision.

REGULATIONS

AMENDMENTS AND SUPPLEMENTS TO THE MODEL FINANCIAL REGULATIONS OF STATE ENTERPRISE GROUPS
(Issued accompanying Decision No. 995 TC/QĐ/TCDN dated November 1, 1996 of the Minister of Finance)

Article 4: Supplement: "When changing the registered capital, the State Enterprise Group must publicly announce the new registered capital according to the regulations of the Ministry of Finance. In cases where the registered capital is lower than the statutory capital requirement for the industries in which the State Enterprise Group operates, the authority with the right to decide on the establishment of that State Enterprise Group must provide additional registered capital to the State Enterprise Group or reduce its business activities to match the current registered capital level."

Article 5: Clause 1: Remove the clause "... the provisions stipulated in Directive No. 138/CT dated April 23, 1991 of the Chairman of the Council of Ministers (now the Prime Minister)."

Article 8: Add Clause 7: "In the case of purchasing shares, it must comply with the current legal regulations."

Article 9: Remove the old Clause 2 and replace it with the new Clause 2 as follows:

"The following assets:

a) The entire or major part of the main production line. b) Assets with high value as defined by the Ministry of Finance;

When leasing, pledging, or mortgaging, they must be reviewed and decided upon by the head of the agency deciding to establish the enterprise after being examined by the State Capital and Asset Management Agency at the enterprise. When selling to foreign organizations or individuals, permission from the Prime Minister is required."

- Remove the old Clause 4 and replace it with the new Clause 4 as follows: "the difference between the amount received from selling the asset and the remaining value of the asset and the cost of selling the asset (if any) shall be accounted for in the enterprise's operating results."

Article 13: Remove the sentence: "In the case of losses due to force majeure, the Board of Directors decides on handling after consulting the State Capital and Asset Management Agency at the enterprise and the agency deciding to establish the enterprise" and replace it with the sentence "In the case of losses due to force majeure, the Board of Directors prepares a handling plan and reports it to the State Capital and Asset Management Agency at the enterprise. After exchanging opinions with the agency deciding to establish the State Enterprise Group, the State Capital and Asset Management Agency at the enterprise decides on the handling plan or submits it to the Prime Minister for decision."

Article 14: Replace the old Clause 3 with the new Clause 3 as follows: "the difference between the value obtained (including the value of spare parts, scrap for production and business of the enterprise) when liquidating assets with the remaining value of the assets and liquidation costs (if any) shall be recorded in the business results of the enterprise".

Add a new Article after Article 15 called "Article 15B" as follows:

"If the Corporation directly manages capital, assets, and conducts business operations, it shall be responsible for preserving the State capital assigned according to the following regulations:

1. Implement the regime, manage, and use capital and assets in accordance with the provisions of the State.

2. Purchase insurance for assets.

3. Record the following reserve items as business expenses:

a) Reserve for reduction in inventory value: this is the amount expected to reduce the value of materials, goods in stock that will occur in the next business period.

b) Reserve for doubtful debts: this is the expected amount of receivables that cannot be recovered from the total receivables of the Corporation.

c) Reserve for reduction in value of securities investments in financial activities.

The establishment and use of these reserves shall be in accordance with the regulations of the Ministry of Finance.