Circular No. 69/2013/TT-BTC dated May 21, 2013 of the Ministry of Finance guiding the financial management regime applicable to the Peasant Assistance Fund of Vietnam Peasants’ Association

MINISTRY OF FINANCE

Circular No. 69/2013/TT-BTC dated May 21, 2013 of the Ministry of Finance guiding the financial management regime applicable to the Peasant Assistance Fund of Vietnam Peasants’ Association

Pursuant to the Decree No. 118/2008/ND-CP dated November 27, 2008 of the Government defining the functions, tasks, powers and organizational structure of the Ministry of Finance;

Pursuant to the Decision No. 673/QD-TTg dated May 20, 2011 of the Prime Minister on direct implementation and coordination of Vietnam Farmers’ Union to implement some programs and projects on rural economic, cultural and social development for the period from 2011 to 2020;

At the proposal of the Chief-director of the Finance and Banking Department and financial organizations;

The Minister of Finance promulgates the Circular guiding the financial management regime applicable to the Peasant Assistance Fund of Vietnam Peasants’ Association,

Article 1. Subjects of application

Subject of application under this Circular is the Peasant Assistance Fund of Vietnam Peasants’ Association (including the Peasant Assistance Fund Central Committee, the Peasant Assistance Fund at the provincial and district level) which is established under the Document No. 4035/KTTH dated July 26, 1995 on the establishment of the Vietnam Peasant Assistance Fund and the Decision No. 673/QD-TTg dated May 20, 2011 of the Prime Minister on direct implementation and coordination of Vietnam Farmers’ Union to implement some programs and projects on rural economic, cultural and social development for the period from 2011 to 2020.

Article 2. The financial management principles

1. The Peasant Assistance Fund shall operate not for the profit-making purpose, support and assist peasants in developing the rural production.

2. The Peasant Assistance Fund has the legal entity, its own stamps, balance sheet, and is entitled to open the account at the State Treasury, domestic commercial banks in accordance with the Law.

3. The Fund shall take self-responsibility for its operations before law, enjoy the financial autonomy, ensure the capital safety; make up the expenses and risks in the operation according to the Law and under this regulation.

4. The management capital activities, the financial revenue and expenditure activities of the Peasant Assistance Fund shall be subject to the direction and management by the Executive Board of the Vietnam Peasants Association Central Committee at the same level and the Executive Board of the Vietnam Peasants Association Central Committee.

Article 3. Source of capital

1. Operation capital of the Fund shall be formed from the following sources:

a) Equity:

- Capital allocated by the State (for the Peasant Assistance Fund Central Committee granted by the state budget; for the Peasant Assistance Fund at the provincial and district level granted by the provincial and district budget);

- Capital mobilized and received from domestic and foreign organizations and individuals to assist the socio-economic development of rural areas.

- Annually self-supplemented capital.

b) Capital entrusted by the State or provided by the domestic and foreign organizations as financial support for agricultural and rural development.

c) Other legal capital sources according to the Law.

2. The Fund must not mobilize and borrow capital in forms of savings, promissory notes, bills, bonds, commercial loans of organizations and individuals like credit institutions engaged.

Article 4. Regarding capital use

1. The operation capital source of the Fund shall be used to assist peasants in acquiring funds for production development to reduce poverty; improve the production scale and goods production; contributing to the economic structural transformation and developing the collective economic forms in the countryside; create jobs, motivating the application of advanced technology into agriculture production, exploiting the potentials and strengths of the region to produce highly qualified agricultural products, services.

2. Assistance capital for members shall be implemented under the form of refunding assistance loans (level rate, term), not collecting interest but fee.

3. The Peasant Assistance Fund shall have responsibility to manage and use the capital for the right purposes, the right subjects and with efficiency, promptly and fully recover capital amounts lent as assistance to peasants in order to preserve its capital, and then refund fully and promptly financial aids to organizations and individuals in form of refunding.

Article 5. Regarding fee collection

1. The Peasant Assistance Fund shall be entitled to collect fee for the capital amounts lent to ensure the defrayal of necessary expenses for the Fund’s operation. The fee levels must ensure to make up for operation expenses of the Fund, maintain capital intact and ensure the purpose of assisting the farmers. The Peasant Assistance Fund is not entitled to collect any fees besides the fee for assistance loans mentioned above.

2. The Executive Board of the Vietnam Peasant Assistance Fund Central Committee shall implement the fee rate of assistance loan for the Peasant Assistance Fund to unify the implementation.

Article 6. Investment and assets procurement of the Fund

1. The Fund shall be invested and equipped with fixed assets and other assets to serve for the operation of the Peasant Assistance Fund. The investment and procurement of assets at each level shall be implemented by the director of the Peasant Assistance Fund according to the plan approved by the Executive Board of the Peasant Assistance Fund Central Committee at the same level and in the scope of capital source of the investment fund for development.

2. Orders, procedures for construction investment, procurement and repair of fixed assets shall be implemented according to the regulations on investment and construction management.

3. The Peasant Assistance Fund shall implement the management, use and deduction of depreciation, re-judgment, inventory, disposal and sale of fixed assets in accordance with the regulations applicable to the enterprises.

Article 7. Setting up the risk reserve and handling the risks

1. The Peasants Association Fund is deducted for setting up the risk reserve to make up the loss due to the subjective causes arising during the process of lending to help the members of the Fund such as natural disasters (storm, flood, and drought), fire, and epidemic diseases and other causes.

2. The reserve fund shall be at most equal to 0.9% of the debit balance by December 31 each year.

3. The risk reserve shall be used to make up for assistance loans for members of the Fund who meet the difficulties due to the subjective reasons. At the end of the year, if the risk reserve still remains, the remainder of the reserve shall be used for the following year.

4. The Executive Board of the Peasants Association Fund shall set up the regulations on management and use of the risk reserve for the Peasants Association Fund to unify the implementation.

Article 8. Revenues of Peasant Assistance Fund

1. The Fund’s revenues shall include the following:

a) Collected fee for provision of assistance loans to its member;

b) Collected charge for entrusted lending service under the entrusted contract;

c) Collected interest income of the Fund deposited at the State Treasury, commercial banks where the Fund opens the account;

d) Other revenues (if any) in accordance with the Law;

2. The Peasant Assistance Fund shall have the responsibility to correctly, fully and promptly collect revenues.

Article 9.  Expenditures of the Peasant Assistance Fund

1. Professional operation expenses include:

a) Fee paid or Interest paid for capital amounts received as financial aids from domestic and foreign organizations and individuals (if any).

b) Expenses for setting up the risk reserve as stipulated under Article 7 of this Circular;

c) Other professional expenses.

2. Expenses for the Fund’s officials

a) Wages, Social insurance, and medical insurance premiums and other payable wage-based amounts for the Fund’s officials according to the current regime prescribed by the State;

b) Allowances paid to the Association’s officials on the payrolls of the Peasants Association chapters at all levels assigned to directly manage and administer the Peasants Association Fund. The maximum allowance level shall not exceed 0.8 times of the wage level of the Association’s officials assigned to manage and administer the Fund;

c) Allowances paid to the Association’s officials taking part in directing and managing and the officials of the Control Board of the Peasants Association Fund in accordance with the regulations (if any);

3. Managerial and public service expenses:

a) Working trip allowance paid to the Fund’s officials taking working trips in or out of the country as stipulated by the State applicable to the State organizations and public service units;

b) Expenses for procurement of materials, office equipment, documents, newspaper and other materials;

c) Expenses for payment service;

d) Expenses for fixed asset depreciation as stipulated applicable to the enterprises; expenses for buying the asset insurance; expenses for repair, maintenance and procurement of working tools (for assets under the Fund’s management).

dd) Expenses for post service and phones;

e) Expenses for hiring the assets and equipment for the operation of the Fund;

g) Expenses for conferences, training for the Fund’s officials as prescribed by the State applicable to the State organizations and the public service units. The Peasants Association Fund is supported the fee for eating, accommodation, and transport for the participants according to the regime as prescribed by the State;

h) Expenses for propagating, printing the documents; expense for transactions, external activities, expense for visitors as stipulated by the Law;

i) Expenses for inspection, supervision and audit activities.

k) Expenses for revoking the irrecoverable debts;

l) Expenses for supporting activities of the Party, Union of the Peasants Association Fund.

m) Expenses for activities of the Peasants Association Fund Central Committee and Peasant movement at all levels, the annual rate mustn’t be exceeded 10% of the total income of the Peasants Association Fund.

n) Expenses for tax payment, fee payment as stipulated by the Law;

o) Other expenses in accordance with the regulations stipulated by the Law;

Article 10. Distribution of revenue-expenditure difference

1. Revenue-expenditure difference is the total revenue minus the total expenses of year.

2. Annual revenue-expenditure difference of the Peasants Association Fund is distributed as follows:

a) 20% shall be deducted to supplement the investment fund for development;

b) Setting up two funds: reward fund and welfare fund which is the maximum amount of 3 months of salary implemented during the year of the Fund.

c) The remainder after deduction for setting up the investment fund for development, reward fund and welfare fund shall be supplemented to the operation capital source.

Article 11. Using purpose of funds

1. The investment fund for development is used for procurement of assets to serve for the operation of the Fund.

2. Reward fund:

a) Reward fund is used to:

- Reward for individuals, teams of the Peasant Assistance Fund who have the technical innovations and professional orders that bring high efficiency.

- Reward for individual, teams in and outside the Fund who participate in contributing the operation efficiency of the Fund.

b) The Executive Board of the Vietnam Peasants Association Central Committee guides the rate of rewarding for each subject for the Peasant Assistance Fund to implement.

3. Welfare fund is used to pay sports activities, cultural activities, and public welfare of the officials in the Fund; making allowance for officials of the Fund. The director of the Peasant Assistance Fund coordinates with the Union Board to manage and use.

Article 12. Accounting regime

1. The Peasant Assistance Fund shall conduct the book-keeping regime to open accounting books, make voucher recording, and make the financial statements in strict compliance with the current regulations and other regulations of the Ministry of Finance.

2. The Peasant Assistance Fund shall be responsible for making the quarterly and annual financial statements and sending to the Executive Board of the Vietnam Peasants Association Central Committee, the Finance agency, tax agency at the same level, including:

a) Balance sheet;

b) Account balance sheet;

c) Income and expenditure report;

3. Time limit for sending reports:

Quarterly report must be sent within 30 days after the end of each quarter; Annual report must be sent within 90 days after the ending day of the financial year.

Article 13. Audit and financial supervision regime

1. The annual financial statement of the Peasant Assistance Fund’s Central Committee is audited by the State Audit.

2. The Peasant Assistance Fund at the provincial and district level implement the audit of the financial statements at the request of the management and decided by the Executive Board of the Peasant Assistance Fund at the same level.

3. The Vietnam Peasants Assistance Fund Central Committee and the Executive Board of the Vietnam Peasants Association Central Committee at all levels shall be responsible for inspecting, supervising the activities of the Fund; considering and approving the annual financial settlements of the Fund at the same level.

Article 14. Elaboration of annual financial plans

1. The financial year of the Peasant Assistance Fund is counted from January 01 to December 31 annually.

2. The Peasant Assistance Fund shall be responsible for elaborating the annual financial plans to send to the Executive Board of the Vietnam Peasants Association Central Committee at the same level and send to the Finance Agency at the same level for following. The content of the financial plan of the following year, including:

a) Plan on the source and use of peasant assistance capital.

b) Financial revenue and expenditure plan.

Article 15. Organization of implementation

1. The Peasant Assistance Fund shall be held responsible before law for the management, use and preservation of the State’s capital and assets under the Fund’s management for providing assistance loans to peasants, and subject to the inspection of the Vietnam Peasants Association’s Central Committee, the Executive Board of the Vietnam Peasants Association’s Central Committee at all levels and the State finance agency at all levels.

2. The Executive Board of the Vietnam Peasants Association’s Central Committee shall have to organize the monitoring and inspection of financial activities of the Fund, ensuring that the Fund’s capital is managed and used for the right objectives and in line with the Peasants Association’s policies.

3. On the basis of guidelines under this Circular and the financial management documents, the Executive Board of the Vietnam Peasants Association Central Committee shall promulgate specific guiding documents for the Peasant Assistance Fund.

Article 16. Effect

1. This Circular takes effect on July 15, 2013 and replaces the Circular No. 36/2002/TT-BTC guiding the financial management regime applicable to the Peasant Assistance Fund of Vietnam Peasants’ Association.

2. Any problems arising in the course of implementation should be reported to the Ministry of Finance for study and timely supplementation and/or amendment.

For the Minister

Vice Minister

Tran Xuan Ha