Bản dịch văn bản 77/2004/TT-BTC
thong-tu-77-2004-tt-btc
Cơ quan ban hành: Bộ Tài chính
Ngày ban hành: 2004-08-04

CIRCULAR No. 77/2004/TT-BTC OF AUGUST 4, 2004 GUIDING THE MECHANISM ON FINANCIAL MANAGEMENT AND DISBURSEMENT OF CAPITAL OF CENTRAL REGION LIVELIHOOD IMPROVEMENT PROJECT Pursuant to Loan Agreement No. 1883 -VIE (SF) of April 2, 2002 signed between the Socialist Republic of Vietnam and the Asian Development Bank (ADB) for Central Region Livelihood Improvement Project; Pursuant to the Financing Agreement signed on May 4, 2004 between the Socialist Republic of Vietnam Government and the Asian Development Bank- ADB on the non-refundable aid amount of the Department for International Development of the United Kingdom - DFID; Pursuant to the Government's Decree No.17/2001/ND-CP of May 4, 2001 on promulgation of the Regulation on management and use of ODA capital sources; Pursuant to the Government's Decree No. 52/1999/ND-CP of July 8, 1999 on the promulgation of the Regulation on Investment and Construction Management; Decree No.12/2000/ND-CP of May 5, 2000 and Decree No. 07/ND-CP of January 30, 2003 amending and supplementing a number of articles of the Investment and Construction Management Regulation issued together with Decree No. 52/1999/ND-CP of July 8, 1999; Pursuant to the Government's Official Dispatch No.1001/CP-QHQT of November 6, 2001 approving the pre-feasibility study report of the Central Region Livelihood Improvement Project; Pursuant to Joint Circular No. 666/2001/TTLT/BKH-UBDTMN-TC-XD of August 23, 2001 guiding the management of investment in, and construction of, infrastructure works under Program 135; Pursuant to Decision No. 1619/QD-UB of August 5, 2002 of the People's Committee of Quang Tri province, approving the livelihood improvement project in Quang Tri province; Decision No. 515/QD-UB of July 30, 2002 of the People's Committee of Kon Tum province, approving the livelihood improvement project in Kon Tum province; Decision No. 1285/QD-UB of June 19, 2002 of the People's Committee of Quang Binh province, approving the livelihood improvement project in Quang Binh province; Decision No. 2189/QD-UB of August 28, 2002 of the People's Committee of Thua Thien- Hue province, approving the livelihood improvement project in Thua Thien-Hue province, under the ADB-funded Central Region Livelihood Improvement Project. In order to ensure the uniformity in the financial management of the Project after the decentralization model, after reaching agreement with the Ministry of Planning and Investment, the Finance Ministry hereby issues this Circular guiding the mechanism for financial management and funding for the Central Region Livelihood Improvement Project as follows: I. GENERAL PROVISIONS 1. Term interpretation The perceptions and terms used in this Circular have the same meanings as those in the Loan Agreement and are construed as follows: - The international financial institution financing the Project is the Asian Development Bank (abbreviated to ADB) and Department for International Development of the United Kingdom (abbreviated to DFID). - The Loan Agreement is the Credit Agreement signed between Vietnam and ADB on the ADB's financial assistance to Vietnam (the borrowing party) with a loan in different currencies equivalent to 34,058,000 SDR for investment in the Project. - Financing Agreement is the Agreement signed on May 4, 2004 between the Vietnamese Government and ADB on the non-refundable aid amount entrusted by the DFID as financial assistance to the Central Region Livelihood Improvement Project. - Project means the Central Region Livelihood Improvement Project, which was approved by the Prime Minister in Official Dispatch No. 1001/CP-QHQT of November 6, 2001. - The Ministry of Planning and Investment is the agency in charge of project general coordination, responsible for organizing the efficient execution of the project strictly according to the approved objectives. - The provinces participating in the project include Quang Binh, Quang Tri, Thua Thien-Hue, Kon Tum. The provincial People's Committees shall be owners of their respective provincial livelihood improvement projects, responsible for organizing the implementation thereof in their respective localities. - The Central Project Office (CPO) is placed under the Local and Territorial Economy Department of the Ministry of Planning and Investment, set up by decision of the Ministry of Planning and Investment and responsible for organizing and coordinating the project. - The provincial livelihood improvement project management boards (abbreviated to provincial PMBs) are attached to the provincial Planning and Investment Services, set up by decisions of the People's Committees of the provinces participating in the project and responsible for organizing the implementation of the project in their respective provinces. - The district technical assistance groups set up under the provincial People's Committees' decisions to assist the provincial PMBs in organizing the implementation of the project in the districts and provide technical assistance to commune project management boards. - The commune project management boards (abbreviated to commune PMBs) are units set up by decisions of the district People's Committees under authorization of the provincial People's Committees and with the agreement of the provincial PMBs in order to organize the implementation of commune mini-projects and other activities of the project in the communes according to the decentralization in the project. - The commune supervisory boards (SBs) set up by the district People's Committees at the requests of the commune People's Councils in order to supervise the activities of project execution in the communes. - Vietnam Bank for Agriculture and Rural Development (BARD) has two functions: + Acting as the bank in service of the project for the CPO and the provincial PMBs; + Acting as the bank performing the micro-financial mini-components (small-scale credit) through its Central Vietnam Representative Office headquartered in Da Nang; - The Bank for Industry and Commerce (Da Nang branch) is the bank servicing activities of micro-financial mini-components, carried out by the Central Vietnam Representative Office of the BARD. 2. Management principles 2.1. The Central Livelihood Improvement Project is invested with State budget capital sources, including loan capital of the ADB, aid capital of the DFID and the reciprocal capital allocated to the CPO by the central budget, the reciprocal capital allocated by the provincial budgets for project activities carried out in the provinces; capital contributed by people in the project region. 2.2. The management and use of ADB's loan capital, DFID's aid capital and reciprocal capital (capital construction capital sources) shall comply with the State's current Regulation on Investment and Construction Management, the provisions in the Loan Agreement and the provisions of this Circular. 2.3. The CPO is responsible for managing the expenditures and carrying out the procedures for withdrawal of capital of the ADB, DFID and reciprocal capital paid for the project activities carried out by the CPO; sum up the situation of implementation and capital withdrawal of the entire project, reported by the provincial PMBs and the Central Vietnam Representative Office of the BARD for supply to the ADB and report to the Vietnamese Government. 2.4. The provincial PMBs and the Central Vietnam Representative Office of the BARD shall have to carry out procedures for withdrawal of capital of the ADB and DFID and the reciprocal capital, manage expenditures and make payment for project activities and make sum-up reports to the Ministry of Planning and Investment (the CPO) and the Finance Ministry. 2.5. The CPO, the provincial PMBs, the Central Vietnam Representative Office of the BARD, the commune PMBs shall have to use capital for the right purposes, to the right subjects and in accordance with the approved project contents and the current regulations of Vietnam and the Loan Agreement. 2.6. The reciprocal capital source for project activities in the four provinces shall be included in the budgets of the provinces participating in the project or mobilized from other lawful sources. 2.7. The Central State Treasury (CST) and the State Treasuries of the provinces and districts participating in the project shall control the payment of the project's capital according to the current regulations on control of State budget payment. The certification of State Treasuries of different levels on written requests for advances, the volume payment price tickets/or payment lists, hereinafter called the price tickets for short, must clearly determine the reciprocal capital of each budget level and ADB capital or DFID capital strictly according to the aid proportions prescribed in the Loan Agreement or Financing Agreement. The price tickets with the State Treasuries' certification are obligatory documents in the dossiers for withdrawal of ADB or DFID capital and payment of the budget reciprocal capital. 2.8. Vietnam Bank for Agriculture and Rural Development (BARD) and Vietnam Bank for Industry and Commerce (Da Nang branch), which carry out procedures for withdrawal and payment of ADB/DFID capital sources according to the provisions of this Circular, shall enjoy service charges suitable to Vietnam State Bank's regulations on via-bank payment service charges. The above service charges shall be paid from the interest amounts arising on the advance account's balance and calculated into the total investment amount of the project. Where the interests arising on the advance account's balance is not enough or the advance account is unavailable (for the CPO), the deficit shall be paid from the reciprocal capital source of the project. The interests arising on the advance account shall be separately accounted every month. Upon the completion of the project, the interest balance arising on the advance account shall be transferred back to the State budget into the account numbers indicated by the Finance Ministry. II. SPECIFIC PROVISIONS 1. Elaborating investment capital plans and notifying investment capital plans The CPO shall guide the provincial PMBs in elaborating annual financial plans of the project, covering all sources of ADB capital, DFID capital, reciprocal capital of the local budgets and people's contributions as provided for; sum up the annual financial plans of the whole project for submission to the Ministry of Planning and Investment, the Finance Ministry and ADB. 1.1. In mid-June every year, the commune PMBs shall draw up the subsequent year's financial plans of the project within their respective communes for submission to the provincial PMBs. Then the provincial PMBs shall synthesize them and make the subsequent year's financial plans of the project within their respective provinces, which conform with the project execution plans (including expenses for activities of the provincial PMBs, the commune PMBs, the commune SBs and district technical assistance groups. These financial plans shall be addressed to the provincial Services of Planning and Investment, Services of Finance, the Ministry of Planning and Investment, the Ministry of Finance on July 20 every year at the latest before the plan year. 1.2. The Central Vietnam Representative Office of the BARD shall draw up plan for implementation of the micro-financial component (including plan on withdrawal of foreign capital and reciprocal capital arranged by the BARD itself according to the project's regulations in each province participating in the project) and send it to the Ministry of Planning and Investment (the CPO), the Finance Ministry, the provincial PMBs for monitoring the execution of the micro-financial component. 1.3. The CPO shall draw up the financial plan for project's activities carried out by the CPO and at the same time sum up the financial plan of the whole project for sending to the ADB, the Ministry of Planning and Investment and the Finance Ministry. 1.4. The financial plan's contents must fully reflect all capital sources of the project, including ADB loan capital, DFID's non-refundable aid capital, the beneficiaries' contributions, reciprocal capital and detail them according to work items, and at the same time enclose them with the content explanation/financial plan explanation compatible with the detailed work plan of the project. The provincial-level financial plans of the project shall be incorporated in the general budgetary plans of the provinces for submission to the Government, the National Assembly for approval according to current regulations. The CPO's financial plan for project execution shall be incorporated in the budgetary plan of the Ministry of Planning and Investment for submission to the Government and the National Assembly for approval according to current regulations. 1.5. After the Prime Minister assigns the annual general budget plans to the provinces, the provincial Services of Finance shall have to coordinate with provincial Services of Planning and Investment in projecting the distribution of capital to each project managed by the provinces so that the provincial People's Committees shall submit them to the provincial People's Councils for issuing resolutions on capital distribution to the project, including the reciprocal capital, people's contributions, ADB loan capital and DFID's non-refundable aid capital. Basing themselves on the People's Councils' resolutions, the provincial People's Committees shall issue decisions on plan distribution and direct the provincial Services of Finance to examine and notify the capital payment plans (detailed for each unit) of the project for the provincial State Treasuries to use as basis for controlling and paying capital in the plan year. The provincial People's Committees' capital distribution decisions shall be addressed to the Ministry of Planning and Investment and the Finance Ministry for summing up and monitoring the project execution situation. The Ministry of Planning and Investment shall issue decisions to assign plans on investment capital from the reciprocal capital sources and the ADB loan capital source to activities carried out by the CPO. Basing itself on the capital plan assigned to the CPO, the Finance Ministry shall check the validity of the capital plan and notify it to the Central State Treasury for controlling payment in the plan year. 1.6. Basing themselves on the project's financial plan already notified, the provincial PMBs and the commune PMBs shall organize the execution of the investment capital plan and draw up the quarterly spending plans and send them to the State Treasuries where they carry out their transactions; the CPO shall make a plan on the whole year's expenditures and send it to the State Treasury where its transactions are carried out for project execution in the year. 2. The advance account and the reciprocal capital account 2.1. The CPO shall open one reciprocal capital account in Vietnam dong at the Central State Treasury to receive and pay the reciprocal capital allocated to the project by the central budget. 2.2. The provincial PMBs shall open the following accounts: - An advance account in US dollar at a provincial branch of the BARD to receive capital advanced by ADB. - An advance account in US dollar at a provincial branch of the BARD to receive capital advanced from the non-refundable aid source of the DFID for project activities in the provinces. - A reciprocal capital account in Vietnam dong at the provincial State Treasury to receive and pay the reciprocal capital of the provincial budgets to the Project. 2.3. The commune PMBs shall open the following accounts - An advance account in Vietnam dong at a district branch of the BARD (the commune-level account) to receive ADB capital from the advance accounts of the provincial PMBs. - A reciprocal capital account in Vietnam dong at a district State Treasury to receive and pay the reciprocal capital of the provincial-level budget for the project. 2.4. The Central Vietnam Representative Office of the BARD shall open the following accounts: - An advance account in US dollar in the Da Nang-based branch of the Vietnam Bank for Industry and Commerce to receive ADB capital for disbursement to the micro-financial components. 3. Exchange rates applicable to the payment and accounting: Exchange rates applicable to the payment and accounting of expenditures from the provincial advance accounts shall be the buying exchange rate of the service bank at the time of payment. For commune-level, accounts the provincial PMBs shall use the buying exchange rate of the service bank at the time of transferring capital into the commune advance accounts and this exchange rate shall be used when filing the application for capital withdrawal to the ADB for adding the advance accounts to such spent amounts. 4. The process of controlling expenditures and payment with reciprocal capital of the project 4.1. Project dossiers and documents supplied at a time In order to carry out procedures for controlling expenditures and payment with the domestic reciprocal capital sources and withdrawing foreign capital of the project, the CPO shall send at a time to the Finance Ministry (the External Finance Department, the Central State Treasury), the provincial PMBs send to the provincial State Treasuries and the commune PMBs send to the district State Treasuries the following documents: - The feasibility study report of the Central Region Livelihood Improvement Project and the written approval of the Prime Minister (except for the commune PMBs). - The provincial People's Committee's decision approving the provincial livelihood improvement project (except for the commune PMBs). - Copies of the Loan Agreement and Financing Agreement (in case of payment with the sources of ADB or DFID capital). - The annual capital plan assigned by the Ministry of Planning and Investment (for the CPO) and the annual capital plans assigned by the provincial People's Committees (for provincial, commune PMBs); - The investment report enclosed with the investment decision of the competent authority (in case of having to make investment reports); - Decisions approving the bidding results or decisions on appointment of bidders, approved by competent authorities. - The economic contracts with contractors (if any). - The competent authority's decision approving the contents of the economic contracts( in case of foreign contractors) and ADB's document approving the contractual contents (in cases where the contracts require prior comments of ADB). - Item estimates enclosed with the approving decision of the competent authority. - Guarantee for contract performance (if any). 4.2. Control and payment via State Treasury system The State Treasuries of all levels shall control payment expenditures of foreign capital sources and reciprocal capital sources of the Project strictly according to the current regulations on control of budget capital expenditures. 4.2.1. Payment of the CPO 4.2.1.1. Payment dossiers to be sent to the Central State Treasury: For each payment request, the CPO shall send to the Central State Treasury the following documents: - The advance request (in case of advance payment). - The pre-acceptance test record enclosed with the table of value of completed volume requested for payment (in case of payment of completed volume). - The payment price ticket. - Other dossiers (for other expenditures). - Investment capital withdrawal/expenditure accreditation paper (in case of reciprocal capital payment). 4.2.1.2. Within 5 working days after receiving the valid payment dossiers, the Central State Treasury shall check the dossiers, certify on the price tickets the capital amount eligible for advance or payment strictly according to ADB loan capital and reciprocal capital proportion prescribed in the Loan Agreement. The price tickets certified by the Central State Treasury shall be made in five copies to be sent to the Central State Treasury (2 copies), the External Finance Department of the Finance Ministry (when submitting application for withdrawal of ADB capital), the CPO and the contractor (if any). The price tickets certified by the Central State Treasury shall serve as one of the dossiers for withdrawal of ADB capital and payment of the reciprocal capital, clearly stating each capital source in strict accordance with the financing proportions prescribed in the Loan Agreement. At the same time, the Central State Treasury shall pay the reciprocal capital of the Project according to the certification on the price ticket. 4.2.2. Payment of the provincial PMBs 4.2.2.1. The payment dossiers of the provincial PMBs: For each payment request, the provincial PMBs shall send a set of payment voucher dossiers to the provincial State Treasuries of their transactions. Such a voucher dossier includes the following documents: - The advance request (in case of advance payment). - The pre-acceptance test record enclosed with the table of value of the completed volume requested for payment (in case of completed volume payment). - The price ticket. - Other vouchers (for other expenditures). - Investment capital withdrawal/expenditure accreditation paper (in case of reciprocal capital payment). 4.2.2.2. Within 5 working days after receiving the valid payment dossiers, the provincial State Treasuries shall check the dossiers, certify on the price tickets the capital amounts eligible for advance or payment strictly according to the ADB loan capital or DFID aid capital and reciprocal capital proportions prescribed in the Loan Agreement. The price tickets certified by the provincial State Treasuries shall be made in 6 copies to be sent to the local State Treasury (2), the provincial PMBs, the External Finance Department of the Finance Ministry (when submitting application for withdrawal of ADB, DFID capital), the local service banks (when making payment from the advance accounts) and the contractor (if any). At the same time, the provincial State Treasury shall pay the reciprocal capital amounts as certified in the price tickets. 4.2.3. Payment of the commune PMBs 4.2.3.1. The payment dossiers of the commune PMBs: For each request, the commune PMBs shall send one set of payment voucher dossiers to the district State Treasuries of their transactions. Such a voucher dossier shall include the following documents: - The advance request (in case of advance payment). - The pre-acceptance test record enclosed with the table of value of the completed volume requested for payment (in case of completed volume payment). - The price ticket. - Other vouchers (for other expenditures). - Investment capital withdrawal/expenditure accreditation paper (in case of reciprocal capital payment). 4.2.3.2. Within 5 working days after receiving the valid payment dossiers, the district State Treasuries shall check the dossiers, certify on the price tickets the capital amounts eligible for advance or payment strictly according to the ADB loan capital or DFID aid capital and the reciprocal capital proportions prescribed in the Loan Agreement. The price tickets certified by the district State Treasuries shall be made in 7 copies to be sent to the district State Treasuries (2), the provincial PMBs (2) for archival and submission to the Finance Ministry (the External Finance Department) when filing applications for withdrawal of ADB, DFID capital), the commune PMBs, the local service banks (when making payment from the advance accounts) and contractors (if any). At the same time, the district State Treasury shall pay the reciprocal capital amounts certified on the price tickets. 5. Procedures for withdrawal, payment of foreign capital sources Capital withdrawal and payment with the sources of foreign capital of ADB, DFID shall all be made on the basis of payment requests, which have been already controlled and certified on the price tickets by the corresponding State Treasuries (except for micro-credit component). Foreign capital shall be withdrawn in the following 4 forms: Direct payment, advance account, letter of commitment and capital reimbursement. 5.1. Direct payment Direct payment is the form of payment made at the borrower's request, ADB shall transfer the direct payment money to contractors/service providers. This form usually applies to case of payment according to implementation schedule for contracts on big construction and installation and consultancy or contracts on import of goods with small volume, not necessary to open letters of credit. To make direct payments, the provincial PMBs/the CPO shall send payment dossiers with the following documents to the Finance Ministry (the External Finance Department) for carrying out procedures to withdraw ADB loan capital/DFID capital: - The written request for withdrawal of capital for direct payment. - The capital withdrawal application and payment lists, made according to forms set by ADB. - The price tickets certified by the State Treasury (the original). - Invoices/payment requests of contractors/service providers. - Other vouchers (if any). Within 5 working days after receiving the complete and valid payment dossiers, the Finance Ministry (the External Finance Department) shall send official dispatches to the provincial PMBs/the CPO and the BARD for jointly signing the capital withdrawal applications before they are sent to the ADB. The ADB shall consider, approve and transfer the direct payment money to the contractors/service providers. 5.2. Payment according to advance account procedures The form of capital withdrawal by advance accounts is the form by which the ADB shall advance a sum of money into the advance accounts of provinces (two separate accounts for ADB's money sources and DFID's sources respectively) so that the borrowing parties may take initiative in making small payments, domestic payments, reduce the number of applications for direct withdrawal of capital for transferring overseas with small amounts, shortening the time in order to speed up the project capital payment. The ceiling level of the advance account of the whole project is provided for in the Loan Agreement. However, depending on the implementation tempo, the project's payment demands, the provincial PMBs may withdraw capital into the advance accounts at the levels lower than the ceiling level. 5.2.1. First withdrawal of capital for deposit into the provincial-level advance accounts and the commune-level accounts 5.2.1.1. The provincial advance accounts Basing themselves on the expenditure plan of the project in each province for six months to come, the provincial PMBs shall send the capital withdrawal dossiers to the Finance Ministry (the External Finance Department). Such a capital withdrawal dossier includes: - The written request for first capital withdrawal into the advance account. - The capital withdrawal application and payment list, made according to forms set by ADB. - The plan on the project's expenditures in six months to come in the province. - Within 5 working days after receiving the complete and valid dossiers, the Finance Ministry shall send official dispatches to the provincial PMBs and the BARD for jointly signing the capital withdrawal applications before they are sent to ADB. - The ADB shall consider, approve and transfer money into the provincial advance accounts. 5.2.1.2. Commune-level accounts Basing themselves on the situation of implementation by the commune PMBs, the provincial PMBs shall consider and make first capital transfer into the commune-level accounts. 5.2.2. Payment from provincial-level advance accounts and commune-level accounts When there are demands for payment with foreign capital sources (strictly according to the support proportion for each item), the provincial or commune PMBs shall forward the expenditure accreditation enclosed with the price tickets already certified by the State Treasuries to the provincial/district branches of the BARD, requesting the disbursement from the provincial advance accounts, commune-level accounts for payment to beneficiaries (contractors, goods or service providers...). 5.2.3. Adding the advance accounts of the provincial PMBs and commune-level accounts 5.2.3.1. Commune-level accounts Monthly or when the commune-level accounts have made payments exceeding 50% of the ceiling level to be advanced, the commune PMBs shall gather the spending vouchers and compile dossiers for capital withdrawal to add the accounts and send them to the provincial PMBs for adding the commune-level accounts. A dossier for withdrawal of capital for addition to commune-level accounts shall include: - The written request for withdrawal of capital to be added to the commune-level accounts; - The list of expenditures from the commune-level accounts; - The price tickets certified by the district State Treasury (to be arranged strictly according to the order in each list of expenditures); - The list of advance accounts related to expenditure items supplied by the BARD with certifying signatures, expressing in detail transactions with debit, credit, balance on the advance accounts according to the temporal order. These transactions must be compatible with the payment expenditures of the commune PMBs. - Other vouchers and documents as requested by the provincial PMBs. Within 5 working days after receiving the complete and valid dossiers, the provincial project management boards shall transfer capital for addition to the commune-level accounts. 5.2.3.2. The advance accounts of the provincial PMBs Monthly or when the advance accounts have made payments exceeding 50% of the ceiling level to be advanced, the provincial PMBs shall gather expenditure vouchers, compile dossiers of withdrawal of capital for addition to the advance accounts and send them to the Finance Ministry (the External Finance Department). The dossier for withdrawal of capital for addition to the advance accounts of the provincial PMBs shall include: - The written request for withdrawal of capital for addition to the advance accounts and the capital withdrawal applications made according forms set by the ADB. - The list of expenditures from the advance accounts (made according form set by ADB). - The price tickets certified by the provincial State Treasuries (to be arranged strictly according to the order in each expenditure list). - In cases where the expenditures range from USD 50,000 or more, the provincial project management boards must also send the contracts, vouchers, invoices and receipts of money reception by the contractors who have made such expenditures. - The list of advance accounts related to expenditures supplied by provincial/district branches of the BARD with certifying signatures, expressing in detail transactions with debit, credit, balance on the advance accounts in the temporal order. These transactions must be compatible with the expenditures paid by the provincial PMBs. Within 5 working days after receiving the complete and valid dossiers, the Finance Ministry (the External Finance Department) shall send official dispatches approving the requests for withdrawal of foreign capital according to the procedures for addition to advance accounts to the provincial PMBs and the BARD for jointly signing the capital withdrawal applications before they are sent to the ADB. ADB shall consider, approve and transfer money for addition to the advance accounts of the provincial PMBs. 5.3. Payment according to capital reimbursement procedures Payment according to capital reimbursement procedures means a form of paying by ADB as its financial support the project's expenditures which have arisen and been paid with budget capital or other capital sources of investors by the project management boards at different levels. This form often applies to cases of payment for small procurements, management boards' expenses or a number of capital construction items. In order to withdraw capital in form of capital reimbursement, the CPO or the provincial PMBs shall send to the Finance Ministry (the External Finance Department) the capital withdrawal dossiers, consisting of the following documents: - The official dispatch requesting the capital withdrawal in form of capital reimbursement. - The capital withdrawal application and payment lists made according to forms set by ADB. It must be clearly inscribed with the name and account number of the unit which has advanced payment for such proposed capital reimbursement amount. - The price ticket already paid with certification of the State Treasury and the money certificate/receipt of contractor. - Additional vouchers and documents (if necessary). - Within 5 working days after receiving the complete and valid payment dossiers, the Finance Ministry (the External Finance Department) shall send official dispatches approving the requests for withdrawal of foreign capital according to the capital reimbursement procedures to the BARD so that the latter shall join the CPO or/the provincial PMBs in signing the capital withdrawal applications before they are sent to the ADB. ADB shall consider, approve and transfer the reimbursement money to the State budget (for source of advance from the State budget) or to the investors (for advanced capital mobilized by investors themselves). 5.4. Payment according to letter of credit (L/C) procedures The payment according to L/C procedures means the form of payment at the Vietnamese party's requests, whereby the ADB issues a letter of credit to secure the payment to the commercial bank a money amount to be paid by L/C. This form usually applies to cases of payment for import goods by L/C. The order shall be as follows: - The CPO/the provincial PMBs shall send to the Finance Ministry (the External Finance Department) the capital withdrawal dossiers comprising the official dispatch requesting the capital withdrawal in form of L/C and the capital withdrawal application and the lists made according forms set by ADB. - Within 5 working days after receiving the complete and valid payment dossiers, the Finance Ministry (the External Finance Department) shall send official dispatches approving the L/C opening and the requests for withdrawal of foreign capital in form of letter of credit to the CPO or/the provincial PMBs and the BARD for jointly signing the capital withdrawal applications before they are sent to ADB. - ADB shall consider and approve the issuance of letter of credit and shall pay to the service banks the money amounts stated in the L/C. 5.5. Capital withdrawal for micro-financial component - In order to implement the credit component, the Central Vietnam representative office of the BARD may make advance with the ADB capital source equivalent to the credit plan in three months, through the advance account of the Central Vietnam representative office. - To deploy micro-credit activities, the BARD in the project provinces shall draw up credit plans (providing loans strictly according to the specific provisions in the Loan Agreement, the Project Agreement, micro-financial hand-book) and send them to the Central Vietnam representative office of the BARD. Basing itself on the above-said credit plans, the Central Vietnam representative office of the BARD shall transfer capital to the Bank for Agriculture and Rural Development branches in provinces as requested for carrying out micro-credit activities. - The BARD branches in the project-participating provinces shall provide loans strictly according to the provisions in the Loan Agreement, the Project Agreement and the micro-financial hand-book. Later, the BARD provincial branches shall make detailed lists of micro-financial loans and send them to the Central Vietnam representative office of the BARD for carrying out procedures to settle amounts already lent, and at the same time for supplementing capital sources for subsequent lendings. - The dossiers on settlement of loans of the provincial branches of the BARD shall serve as basis for the Central Vietnam representative office of the BARD to carry out procedures to withdraw capital for addition to advance account for the micro-financial components. The process and dossiers of withdrawal of ADB capital of the project's credit component shall apply as follows: - For dossiers on withdrawal of capital from ADB into the advance accounts: The Central Vietnam representative office of the BARD shall send to the Finance Ministry (the External Finance Department) the capital withdrawal dossiers comprising: the written request, the capital withdrawal application, made according ADB-set forms, the lists of advance accounts, the list of credit plans, report on the use of borrowed capital of the micro-credit component (excluding the first withdrawal of capital). Within 5 working days after receiving the complete and valid payment dossiers, the Finance Ministry (the External Finance Department) shall send official dispatches approving the requests for withdrawal of foreign capital according to advance account- supplementing procedures to the Central Vietnam representative office of the BARD and Vietnam Bank for Industry and Commerce (Da Nang branch) for signing the capital withdrawal applications to be sent to the ADB. Later, the ADB shall consider and agree to transfer the money for addition to the advance account of the micro-financial mini-component. - The dossiers for withdrawal of capital from advance accounts for lending shall comprise the written request, the credit notice and the buying and selling exchange rates of Vietnam Bank for Industry and Commerce (Da Nang branch) on the day the ADB transfer the money, the capital handover record made according to set form of the Finance Ministry, clearly stating the Vietnam dong amount and the date of debt acknowledgement. 6. The reporting, inspection, auditing and settlement regime 6.1. Reporting - Monthly, the provincial branches of the BARD shall have to send lists of advance accounts to the provincial PMBs, the provincial State Treasuries (where the project conducts transactions) for monitoring the situation of revenue and expenditure with the borrowed capital via accounts and serving as basis for State budget revenue and expenditure accounting. - Quarterly, the provincial PMBs shall have to make reports on implementation of the project, implementation of the financial plans of the project in their respective provinces and send them to the provincial Services of Planning and Investment, Services of Finance, the provincial State Treasuries, the Ministry of Planning and Investment (the CPO), the Finance Ministry. - Quarterly, the CPO shall have to make reports on implementation of the project, implementation of the financial plans under the spending tasks of the CPO and sum up the implementation of the financial plan of the entire project, report it to the Ministry of Planning and Investment, the Finance Ministry (the External Finance Department and the Investment Department). - Quarterly, the Central Vietnam representative office of the BARD shall have to make report on the situation of implementation of micro-credit component and send it to the Ministry of Planning and Investment, the Finance Ministry and the provincial PMBs. 6.2. Audit - Annually, the advance accounts, accounting books and dossiers of the CPO and the provincial PMBs must be audited by an independent auditing firm lawfully operating in Vietnam in accordance with the regulations of the State and ADB. - The selection of auditing firms to audit activities of the CPO shall be decided by the Ministry of Planning and Investment. The selection of auditing firms to audit activities of the provincial PMBs shall be decided by the provincial People's Committee. The selection of auditing firms must be conducted by modes suitable to the current regulations of Vietnam and ADB. The selection results must be approved by the Finance Ministry and ADB. - The auditing reports must be sent to the Finance Ministry (the External Finance Department and the Investment Department), the Ministry of Planning and Investment, the provincial People's Committees and ADB. 6.3. Inspection Regularly and irregularly, the Finance Ministry, the Ministry of Planning and Investment and the provincial People's Committees shall inspect the implementation of the project and the use of capital. If detecting cases of using capital in contravention of regulations, the Finance Ministry shall stop transferring capital and handle the violations according to current regulations. 6.4. Report on investment capital settlement - For all mini-projects, activities of the project, the annual settlement reports and the completion settlement reports must be made in strict accordance with the current regulations on division of responsibility for implementation and competence for appraising and approving the settlement reports. + The commune PMBs shall have to sum up the settlements of activities, mini-projects, assigned to them for implementation, and submit them to competent authorities for appraisal and approval. + The provincial PMBs shall have to sum up the settlements of all activities and mini-projects in their respective provinces and submit them to the competent authorities for appraisal and approval. + The CPO shall have to settle its own activities and sum up the settlements of the entire project of all 4 provinces and send them to the Ministry of Planning and Investment, the Finance Ministry for submission to the Government. - The procedures for making, appraising and approving settlements of investment capital and other matters related thereto shall comply with the provisions of the Finance Ministry's Circular No. 45/2003/TT-BTC of May 15, 2003 guiding the settlement of investment capital (for the CPO and the provincial PMBs) and Circular No. 106/2003/TT-BTC of November 7, 2003 guiding the management of capital for capital construction of communes, district townships or other documents supplementing and amending or replacing the above circulars. 7. A number of norms applicable to the project - The expenses for activities of the CPO, the district technical support groups and the provincial PMBs shall comply with the current regulations on management of investment projects on capital construction and the Finance Ministry's Decision No. 112/2001/QD-BTC of November 9, 2001 promulgating a number of spending norms applicable to projects financed with sources of official development assistance (ODA) loan capital. The source for expenditures comes from the State budget's reciprocal capital. - The expenses for activities of the commune PMBs and the commune SBs shall comply with the Construction Ministry's Circular No. 12/2000/TT-BXD of October 24, 2000 guiding the management expenditures on investment in the construction of infrastructure works under Program 135 as follows: Expenses for management and activities of the commune PMBs and commune SBs shall be taken from the source of 3.5% of the estimated work construction, installation and equipment value approved by competent authorities (for infrastructure works) and estimates for model construction in the communes. The regime on these expenditures shall be decided by the provincial People's Committees. - The allowance levels for officials of the commune PMBs, SBs shall not exceed 50% of the salary level (for case of part-time tasks) and 100% of the salary level (for case of full-time tasks) for equivalent titles in communes. The specific allowance levels shall be decided by the provincial People's Committees. III. IMPLEMENTATION ORGANIZATION This Circular takes effect 15 days after its publication in the Official Gazette. The concerned agencies shall, in the course of managing and implementing the project, have to organize the strict implementation of the provisions in this Circular. If any problems arise in the course of implementation, they should be timely reported to the Finance Ministry for study, amendment and supplement. For the Finance Minister Vice Minister TRAN VAN TA