CIRCULAR

NO. 50/2005/TTLT/BTC-BNV ON JUNE 15, 2005 OF THE MINISTRY OF FINANCE AND THE MINISTRY OF INTERNAL AFFAIRS GUIDING THE STANDARDS, CONDITIONS AND PROCEDURES FOR THE APPOINTMENT, DISMISSAL, REPLACEMENT AND BENEFIT CALCULATION OF CHIEF ACCOUNTANT, ACCOUNTANTS IN STATE ACCOUNTING UNITS.

Implementing Article 45, 46, 47, 48, 49 of the Government's Decree No. 128/2004/NĐ-CP on May 31, 2004 detailing and guiding the implementation of a number of articles of the Law on Accounting applicable to State accounting, after obtaining the opinion from relevant Ministries and agencies, the Ministry of Finance and the Ministry of Internal Affairs guide the standards, conditions and procedures for the appointment, dismissal, replacement and benefit calculation of  Chief accountants and accountants working in accounting units belonging to the State accounting as follows:

I. SUBJECTS OF APPLICATION  

The subject of application in this Circular include the agencies, units and organizations of State accounting running accounting practices as specified in Article 2 of the Government's Decree No. 128/2004/NĐ-CP on May 31, 2004 detailing and guiding the implementation of a number of articles of the Law on Accounting applicable to State accounting (hereinafter referred to as accounting units) as follows:

1. State agencies, non-business units, organizations using the State budget, including:

1.1. Agencies, organizations at all level in charge of the State budget receipts and expenses;

1.2. The National Assembly Office;

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1.4. The Government Office;

1.5. The People’s Courts at all levels;

1.6. The People’s Procuracies at all levels;

1.7. The People’s armed forces, including Military Courts and Military Procuracies;

1.8. The units in charge of the reserve management of the State, the sectors and levels (hereinafter referred to as State reserve units) and other financial funds of the State;

1.9. Ministries, ministerial-level agencies, Governmental agencies, People’s Councils at all levels including accounting units level II, III affiliated to People’s Councils at all levels; People’s Committees at all levels including accounting unit level II, III affiliated to People’s Committees at all levels;

1.10. Political organizations, socio-political organizations, socio-political-professional organizations. Social organizations, socio-professional organizations using the State budget;

1.11. Non-business units having part of or total expense covered be the State budget;

1.12. Organizations in charge of National property;

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1.14. The associations and other organizations of which part of the expense on the operation is supported by the State budget.

2. Non-business units and organizations not using the State budget include:

2.1. Non-business units exercising financial autonomy

2.2. Non-public non-business units;

2.3. Non-governmental organizations;

2.4. Associations exercising financial autonomy

2.5. Social organizations, socio-professional organizations exercising financial autonomy;

2.6. Other organizations not using the State budget.

II. APPOINTING CHIEF ACCOUNTANTS, ACCOUNTANTS OR HIRING CHIEF ACCOUNTANTS

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2. Appointing Chief accountants

The accounting units that must appoint Chief accountants include:

2.1. The accounting units specified in Part I of this Circular except for the accounting units with inconsiderable amount of accounting works as prescribed by the Ministries shall appoint one accountant or part-time accountant as prescribed in Point 3.2 Section 3 Part II of this Circular.

2.2. The units in charge of the State budget receipts and expenses that perform accounting works at all levels.

2.3. Non-business units, organizations using the State budget, State reserve units, other financial funds of the State that run accounting practices under different accounting levels are considered accounting units as prescribed in Clause 2 Article 48 of the Government's Decree No. 128/2004/NĐ-CP on May 31, 2004, including:

a. Accounting units level I;

a. Accounting units level II;

a. Accounting units level III;

2.4. Ministries, ministerial-level agencies, Governmental agencies organizing accounting units level I, II, and III, local sector management services organizing accounting units level I, II, and III that perform accounting works similarly to an accounting unit.

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3. Appointing accountants

The accounting units are entitled to appoint accountants.

3.1. In case the accounting units specified in Section 2 Par II of this Circular do not have any Chief accountant, the Heads of such accounting units must promptly appoint Chief accountants. In case no person is eligible for being a Chief accountant as specified in Part II of this Circular, it is allowed to appoint an accountant. The accountant is only in charge within one fiscal year, then a Chief accountant must be appointed. In case the accountant is still ineligible for being a Chief accountant after one year, it is required to find another person eligible for being a Chief accountant or hire a Chief accountant. Accounting units in remote areas may extent the accountant's term after obtaining the unanimous opinion in writing from financial agencies at the same level.

3.2. The accounting units with inconsiderable amount of accounting works as prescribed by the Ministries except for the units in charge of the State budget receipts and expenses as prescribed in Point 2.2 Section 2 Part II of this Circular shall appoint only one accountant, or appoint one part-time accountant as an accountant. The term of the accountants appointed in this case are not restricted.

3.3. The accounting unit affiliated to a accounting unit level III may appoint an accountant under the decision from the Head of the accounting unit superior to the accounting unit level III.

4. Hiring Chief accountants

Non-business units and organizations not using the State budget may hire accounting services enterprises or persons applied for accounting services registration as their Chief accountants. Non-business units funded by the State budget may hire Chief accountants under the decisions from the legal representatives of such accounting units.

5. The relation between the chief accountant, accountant and the manager, deputy manager of the accounting department

5.1. The accounting units that appointed Chief accountants or accountants must not appoint the accounting department manager. The Chief accountant or the accountant shall perform the duties of the accounting department manager.

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5.3. For units with considerable amount of accounting works, the Chief accountant and deputy manager of the accounting department may be appointed. The deputy manager of the accounting department is the Chief accountant’s assistant to fulfill the assigned duties.

III. STANDARDS AND CONDITIONS FOR BEING APPOINTED AS CHIEF ACCOUNTANTS, ACCOUNTANTS OR HIRED AS CHIEF ACCOUNTANTS

1. Standards and conditions for being appointed as Chief accountants

1.1. Standards for being appointed as Chief accountants

a. Regarding the ethical credentials

- Satisfying the standards of ethical credentials for officials.

- Honest, equitable, willing to adhere to and protect the State’s policies, economic and financial regulations, and the law.

b. Regarding professional skills

- For the accounting units specified in Point 1.1 Section 1 Part I at Central budget allocation units and provincial budget allocation units, the Chief accountants must possess university degrees in accounting or above; Chief accountants of budget allocation units at other level must possess intermediate degrees in accounting or above;

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c. Regarding the accounting practice duration

- For the Chief accountant position that require the university degree or above, the minimum accounting practice duration is 2 years;

- For the Chief accountant position that require the intermediate degree or college degree or above, the minimum accounting practice duration is 3 years;

1.2. Conditions for being appointed as Chief accountants

a. Satisfying the standards specified in Point 1.1 Section 1 Part III of this Circular;

b. Possessing the Chief accountant certificate as prescribed in the Regulation on training and issuing Chief accountant certificates promulgated together with the Decision No. 43/2004/QĐ-BTC on April 26, 2004, or the Chief accountant certificate issued before April 26, 2004 as prescribed in the Decision No. 159 TC/CĐKT on September 15, 1989 and the Decision No. 769 TC/QĐ/TCCB on October 23, 1997 of the Minister of Finance.

c. Not being the subjects ineligible for accounting works as prescribed in Article 51 of the Law on Accounting.

2. Standards and conditions for being appointed as accountants

The person appointed as an accountant must satisfy the standards of professional ethics and skills similar to that of Chief accountant although the standards of the accounting practice duration are not yet satisfied or the Chief accountant certificate is not yet obtained as specified in Point 1.2.b Section 1 Part III of this Circular.

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3.1. Possessing the Accountant certificate as prescribed in Article 57 of the Law on Accounting or the Auditor certificate as prescribed in Article 13 on the Government's Decree No. 105/2004/NĐ-CP on March 30, 2004 on independent auditors;

3.2. Having the Chief accountant certificate as specified in Point 1.2.b Section 1 Part III of this Circular;

3.3. Having applied for accounting services registration, accounting practice registration or audit practice registration in an accounting and audit services enterprises;

3.4. Not being the subjects ineligible for accounting works as prescribed in Article 51 of the Law on Accounting.

4. For units with inconsiderable amount of accounting works, the Chief accountant of the superior unit may be appointed as a part-time Chief accountant of the inferior accounting unit. That person must satisfy the standards and conditions for the Chief accountant of the superior accounting units.

IV. PROCEDURES FOR THE APPOINTMENT AND DISMISSAL OF CHIEF ACCOUNTANTS AND ACCOUNTANTS; FOR HIRING AND TERMINATING CONTRACTS WITH HIRED CHIEF ACCOUNTANTS

1. Procedures for appointment and terms of a Chief accountant or an accountant

1.1. Accounting units in charge of central budget receipts and expenses must make and send the application for the appointment of Chief accountant to the Minister of Finance; the Chief accountant or accountant of an accounting unit in charge of local budget receipts and expenses shall be appointed by the level that appointed its deputy director.

1.2. Non-business units exercising financial autonomy established by the State, organizations using the State budget, State reserve units, other financial funds of the State shall organize the accounting mechanism by accounting level (accounting units level I, accounting units level II, accounting units level III) and appoint Chief accountants or accountants as follows:

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b. Local accounting units level I shall make and send the application for Chief accountant, accountant appointment to the President of the People’s Committee at the same level;

c. Accounting units level II, III shall make and send the application for Chief accountant, accountant appointment to the competent authorities that appointed the deputy directors of such units;

1.3. The Chief accountants or accountants of the accounting units under the management of People’s Councils at all levels shall be appointed under the decision of the Presidents of the People’s Councils at all levels.

1.4. The Chief accountants or accountants of other accounting units shall be pointed by the directors of such units.

1.5. The term of a Chief accountant or an accountant is not restricted. For the accounting unit specified in Point 1.1, 1.2 Section 1 Part IV above, the term is 5 years. The procedures for reappointment Chief accountants are similar to the procedures for reappointment of the director.

2. Procedures for hiring Chief accountants

2.1. The accounting units specified in Section 4 Part II of this Circular hiring Chief accountants being accounting practitioners or accounting services enterprises must sign contracts as prescribed by law. Before signing the Chief accountant hire contract, the hiring accounting unit must make and send the application for Chief accountant appointment to competent authorities for approval as prescribed in Section 1 Part IV of this Circular. The non-business units established by the State may sign the labor contracts that specify the hire of Chief accountants at the unit as prescribed by law instead of signing the working contract.

2.2. The expense on the hired Chief accountant must comply with the Chief accountant hire contract.

3. Procedures for dismissing, replacing Chief accountants and accountants, terminating contracts with hired Chief accountants.

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3.2. The hired Chief accountants that commit violations of the contract terms shall have the Chief accountant hire contract terminated. The procedures for terminating Chief accountant hire contracts are similar to the procedures for concluding Chief accountant hire contracts with the hired individual or the hired accounting and audit services enterprises.

V. BENEFITS OF CHIEF ACCOUNTANTS AND ACCOUNTANTS

1. Chief accountants of the accounting units specified in Section 1 Part I, Point 2.1 Section 2 Part I of this Circular are eligible for the positional benefits calculated by the positional benefits of department managers plus the professional responsibility benefits at level 1 (coefficient = 0.1) compared to the common minimum salary specified in Point d2 Section 7 Article 6 of the Government's Decree No. 204/2004/NĐ-CP on December 14, 2004 on the salary of officers, officials and the armed forces.

Example: Ms. B is an officials belonging to the staff of the Cattle Feed Research Institute affiliated to the Service of Agriculture and Rural development in Bac Giang. Ms. B is an A2 official, the salary coefficient at level 1: 4.40. On April 1, 2005, Ms. B is appointed as the Chief accountant of the Institute, the coefficient of department manager's benefits is 0.5. The Chief accountant’s benefits of Ms. B are calculated as follows:

Chief accountant’s benefits: 0.5 + 0.1 = 0.6

The salary of Ms. B: 290,000  x (4.4 + 0.6) = 1,450,000 (VND)

2. The accountants of the accounting units specified in Section 1 Part I, Point 2.1 Section 2 Part I of this Circular are eligible for the department manager’s positional benefits.

3. The Chief accountants and accountants of other accounting units shall apply the Chief accountant’s benefits and accountant’s benefits specified in Section 1, 2 Part V of this Circular consistently with the operation.

4. A person appointed as the Chief accountant of the superior accounting unit and the Chief accountant of the inferior accounting unit simultaneously (level II, III) is eligible for the benefits of the Chief accountant of the superior accounting unit.

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1. The accounting units are responsible for:

1.1 Appointing eligible Chief accountants or accountants of the units as prescribed in the Government's Decree No. 128/2004/NĐ-CP and the guidance in this Circular;

1.2. Implementing the provisions on the procedures for the appointment and dismissal of chief accountants and accountants; for hiring chief accountants as prescribed in this Circular;

2. Ministries, ministerial-level agencies, Governmental agencies, People’s Committees of central-affiliated cities and provinces are responsible for:

2.1. Guiding the agencies and units to implement the procedures for the appointment, dismissal, replacement and benefits of Chief accountants and accountings or hiring Chief accountants as prescribed by the State and in accordance with this Circular.

2.2. Cooperating with the Academies, universities, colleges providing finance, accounting and audit training, the Vietnam Association of Accountants and Auditors in holding Chief accountant classes in order to appoint eligible Chief accountants that satisfy the standards an conditions specified in this Circular.

2.3. Considering the existing accounting department managers of the accounting unit and appointing them as Chief accountants if they are eligible, or as accountants if they are not.

3. The Ministry of Finance is responsible for:

3.1. Studying and guiding the supplement of the standards, conditions and procedures for the appointment, dismissal and replacement of chief accountants and accountants or hiring chief accountants in accordance with the Law on Accounting, the Decree No. 128/2004/NĐ-CP and this Circular.

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VII. IMPLEMENTATION PROVISIONS

1. Based on this Circular, the Ministries, ministerial-level agencies, Governmental agencies, People’s Committees of central-affiliated cities and provinces shall guide the agencies and units to appoint, dismiss, replace and pay their Chief accountants or accountants, or hire Chief accountants as prescribed by law.

2. This Circular takes effect after 15 days as from its publication on the Official Gazette. The benefits of chief accountants and accountants in this Circular is applicable from October 01, 2004.

During the course of implementation, the Ministries, sectors, localities and units are recommended to promptly send feedbacks on the difficulties to the Ministry of Finance and the Ministry of Internal Affairs for consideration and resolution.

Nguyen Trong Dieu

(Signed)

Tran Van Ta

(Signed)

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