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THE
MINISTRY OF FINANCE
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SOCIALIST
REPUBLIC OF VIET NAM
Independence Freedom Happiness
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No.
109/2007/TT-BTC
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Hanoi,
September 10, 2007
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CIRCULAR
GUIDING
THE STATE FINANCIAL MANAGEMENT OF FOREIGN NON-GOVERNMENTAL AID NOT CONSTITUTING
A STATE BUDGET REVENUE SOURCE
Pursuant to the Governments
Decree No. 77/2003/ND-CP of July 1, 2003, defining the functions, tasks, powers
and organizational structure of the Finance Ministry;
Pursuant to the Prime Minister s Decision No. 64/2001/QD-TTg of April 26, 2001.
promulgating the Regulation on management and use of foreign non-governmental
aid;
The Finance Ministry guides the state financial management of foreign
non-governmental aid not constituting a state budget revenue source as follows:
Part 1
GENERAL PROVISIONS
1. This Circular guides the
state financial management of non-governmental aid provided by foreign
non-governmental organizations, other organizations and foreign individuals,
including overseas Vietnamese, to Vietnams non-state organizations for
humanitarian and development objectives which have been negotiated, concluded
and approved under the Regulation on management and use of foreign
non-governmental aid promulgated together with the Prime Ministers Decision No.
64/2001/QD-TTg of April 26, 2001.
Other supports given by foreign
non-governmental organizations and organizations and individuals beyond the
above scope are regarded as presents not subject to the management guided in
this Circular.
2. Foreign non-governmental aid
not constituting a state budget revenue source means non-governmental aid
defined in Section 1, Part 1 of this Circular, directly provided by
organization or individual donors according to their commitments with non-state
organizations in order to improve the operating capacity and conditions of
these organizations, and approved by competent bodies of these organizations
(defined at Point 2, Article 6 of the Regulation on management and use of
foreign non-governmental aid promulgated together with the Prime Ministers
Decision No. 64/2001/QD-TTg of April 26, 2001).
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a/ Political organizations and
socio-political organizations;
b/ Social organizations,
socio-professional organizations;
c/ Social funds, charity funds;
d/ Economic organizations;
e/ Other non-governmental
organizations.
4. Foreign non-governmental aid
not constituting a state budget revenue source shall be used for the following
purposes:
a/ Financing regular activities;
b/ Financing research, training
and retraining;
c/ Procuring and building
working facilities of organizations;
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5. Non-state organizations shall
bear responsibility before law for transparent management and efficient use of
foreign non-governmental aid not constituting a state budget revenue source for
proper purposes and in strict accordance with their commitments with donors.
When using aid money for spending purposes specified by regulations on
management and use of the state budget, aid-using project owners/units are not
required to organize bidding.
Part 2
SPECIFIC PROVISIONS
I. AID RECEIPT
When aid is directly provided in
the form of goods or turnkey capital construction works or aid money is used to
purchase goods in order to enjoy tax exemption for non-refundable aid goods
according to the provisions of tax law, such goods must go through aid
certification procedures prescribed below:
1. Aid-certifying agency:
The agency competent to certify
foreign non-governmental aid not constituting a state budget revenue source is
the Finance Ministry.
2. Units requesting aid
certification:
Aid-using project owners/units
shall request aid certification. Aid certification requests are stated in aid
certification declaration forms.
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3.1. Set aid certification
declaration forms enclosed with this Circular include:
- Form C1-HD/XNVT: Aid
certification declaration form for imported goods (Appendix 1a, not pruned
herein), which shall be used in making aid certification declarations for
equipment, machinery, supplies, materials, utensils and other kinds of goods
imported from foreign countries;
Form C2-HD/XNVT: Aid
certification declaration form for domestic goods and services (Appendix 1b,
not primed herein), which shall be used in making aid certification
declarations for equipment, machinery, supplies, materials, utensils and other
kinds of goods domestically purchased (including service charges) with foreign
aid.
- Form C3-HD/XNVT: Aid
certification declaration form for monetary aid (Appendix 1c, not printed
herein), which shall be used in making declarations for foreign monetary aid
amounts.
- When a foreign country
provides goods, separate equipment and monetary amounts as aid for building a
capital construction work, which, upon completion, will be transferred to the
Vietnamese side by turnkey mode (below referred to as work construction aid),
the aid-using project owner/unit shall still use forms C1 ,C2 and C3-HD-XNVT in
making declaration for aid certification but mark on the section work
construction aid of such forms and concurrently supply additional information
on the work (name, location, projected time for construction and handover of
the work). After the work is completed and handed over by the donor to the
Vietnamese side, the aid-using project owner/unit shall use these aid
certification declaration forms for drawing up a list of certifications of work
construction aid (according to a form in Appendix 2 to this Circular, not
printed herein). This list and the work takeover test report constitute legal
grounds for the tax agency to refund value-added tax.
3.2. Management of aid
certification declaration forms:
After the Finance Ministry
completes procedures for aid certification, an aid certification declaration
form shall be kept and managed as follows:
- The Finance Ministry shall
keep two copies (in the aid certification register);
-The customs office and the tax
agency shall each process and keep one copy in the tax exemption/refund dossier;
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- The aid-using project
owner/unit shall keep one copy for making reports on receipt, payment and settlement
of the aid program or project.
4. Time of making aid
certification declaration forms:
- Form C1-HD/XNVT: Aid
certification declaration form for imported goods shall be filled in right
after aid-using project owners/units receive import documents (invoices, bills
of lading, airway bills and/or other transportation documents);
- Form C2-HD/XNVT: Aid
certification declaration form for domestic goods and services shall be filled
in on a monthly basis when aid-using project owners/units draw up detailed
lists of decisions on value-added lax refund for aid programs and projects;
- Form C3-HD/XNVT: Aid
certification declaration form for monetary aid shall be filled in right after
the Vietnamese side receives money transfer documents from foreign parties.
5. Necessary dossiers enclosed
with aid certification declaration forms:
5.1. For first-time aid
certification declaration forms:
An aid-using project owner/unit
shall supply to financial agencies at all levels the following documents:
a/ A legal dossier set of the
aid program or project, which comprises the following principal documents:
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- Program or project documents;
- Aid agreement, commitment or
notice;
- In case of necessity, the
Finance Ministry may request the aid-using project owner/unit to coordinate
with functional agencies in supplying information on the operation license of
the foreign non-governmental organization providing aid to the program or project.
b/ Specific documents and
vouchers evidencing aid goods, services or works, such as import documents, the
disbursement notice or money transfer documents of the donor, domestic goods
purchase and service hire documents, purchase and sale contracts, the written
record of handover and settlement of turnkey construction work funded with
foreign aid.
5.2. For subsequent aid
certification declaration forms:
Aid-using project owners/units
shall supply the documents specified at Point 5.1.b above.
5.3. Aid-using project
owners/units shall fully declare the above documents in aid certification
declaration forms and bear responsibility before law for the accuracy of the
declared figures and contents.
6. Places of aid certification:
Aid certification is conducted
at the Finance Ministry (the External Finance Department based in Hanoi, or
this Departments sections in Ho Chi Minh and Da Nang cities which perform the
task of managing and receiving international aid goods).
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7.1. Prices:
- Form C1-HD/XNVT: Aid
certification declaration form for imported goods shall be filled in with the
foreign-currency purchase prices shown on import goods invoices (FOB, CIF,
C&F).
- Form C2-HD/XNVT: Aid
certification declaration form for domestic goods and services shall be filled
in with tax-exclusive prices stated in contracts signed between contractors,
providers and program or project owners.
7.2. Exchange rates for
conversion of foreign currencies into Vietnam dong:
These exchange rates arc those
for foreign-currency accounting announced by the Finance Ministry on a monthly
basis on its website at http:// www.mof.gov.vn/
7.3. To facilitate the taxation
of non-refundable aid, the section on aid-using project owners/units in the aid
certification declaration form must:
- Be fully and accurately filled
in with the names and contact addresses of the aid-using unit, project owner
and project-managing agency.
- Be filled in with the
budget-using unit code of the aid-using project owner/unit; particularly for
aid-using unit that are enterprises or non-business units having revenues,
their tax identification numbers must be additionally declared to facilitate
the tax refund.
II. AID USE LIMITS:
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III. AID ACCOUNTING AND
SETTLEMENT:
Aid-using project owners/units
shall organize the aid accounting in the course of non-refundable aid receipt,
management and use in compliance with the Governments Decree No. 128/2004/ND-CP
of May 31, 2004, detailing and guiding the implementation of a number of
articles of the Accounting Law applicable to the state accounting domain and
the Finance Ministry’s accounting regulations.
The system of accounting
documents and books and financial statements for reflecting in detail and
separately settling the value of aid not constituting a state budget revenue
source is organized under the accounting law applicable to accounting units not
funded with the state budget.
IV. FINANCIAL REPORTS AND
PUBLICITY:
1. Reports on annual settlement
of aid amounts not constituting a state budget revenue source are financial
reports of annual accounting periods. Annual financial reports and annual
settlement reports shall be submitted to reporting units immediate superior
agencies (if any) and finance agencies of the same level according to the
provisions of Articles 24 and 25 of the Governments Decree No. 128/20O4/ND-CP of
May 31, 2004.
2. Accounting units shall
examine, verify and approve annual settlements of aid not constituting a state
budget revenue source of their immediate subordinate accounting units
3. Aid-using project
owners/units shall publicize annual financial statements and annual financial
revenue-expenditure settlements regarding non-refundable aid.
3.1. Contents subject to
financial publicity include:
- Names of aid programs,
projects and amounts;
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- Value of each aid
program/project or amount:
- Aid revenue-expenditure
settlement made under the Accounting Law;
- Accounting results (if any).
3.2. Modes of publicizing
financial reports:
- Sending of written reports to
reporting organizations immediate superior agencies (if any) and finance
agencies of the same level;
- Public posting of reports at
reporting organizations offices;
- Other modes.
3.3. Time of publicization:
Financial reports shall be
publicized right after the completion of annual settlements under the
Accounting Law.
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1. On principle, financial resources
and assets formed from uoti-refundable aid source
provided directly to non-state organizations are owned by these organizations
and used for purposes compliant with their organization and operation charters
in accordance with law, and may not come under any form of personal ownership
in any circumstance.
2. In case separation, division,
consolidation, merger, ownership transformation, dissolution or operation
termination, non-state organizations shall carry out following activities under
specific financial management regulations:
- Closing accounting books,
inventorying assets, identifying unpaid debts and making financial reports;
- Making written records of
handover of assets and unpaid debts, and recording them in accounting books
according to handover records;
- Handing over all accounting
documents to new accounting units;
- New accounting units shall
base themselves on handover records to open accounting books and make
accounting book under the Accounting Law.
3. The handover of assets and
liabilities between old and new accounting units following the issuance of a
separation, division or merger decision must be witnessed and certified by the
agency that has signed the separation, division or merger decision and the
finance agency
4. Documents relevant to
separation, division, consolidation, merger, ownership transformation,
dissolution or operation termination, which are accounting documents, must be
preserved for at least 10 years at archival places decided by agencies
competent to decide on the separation, division, consolidation, merger,
ownership transformation, dissolution or operation termination.
Part 3
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1. This Circular takes effect 15
days after its publication in CONG BAO and replaces the Finance Ministry’s Circular
No. 32/2005/TT-BTC of April 26, 2005, guiding the state financial management of
foreign non-refundable aid for associations.
2. Problems arising in the
course of implementation should be promptly reported by non-state organizations
to the Finance Ministry for study and appropriate supplementation and
amendment.
FOR
THE FINANCE MINISTER
VICE MINISTER
Tran Xuan Ha