Tổ chức hạch toán kế toán tại các đơn vị sự nghiệp công lập thuộc tổng cục địa chất và khoáng sản việt namastract

However, the task of accounting in public service agencies in general and in other organizations of the General Department of Geology and Minerals of Vietnam had some shortcomings in rec

CHAPTER 1 INTRODUCTION TO THE STUDY 1.1 The rationale of the study

Accounting is one of the effective management tools that are used by the public

service agencies to manage assets, the process of receiving, using and settling funds For

accounting to become an effective management tool in these agencies, the scientific and

suitable accounting is one of the effective state management tools that enable public

service agencies to utilize the funds

In recent years, the state accounting system in general and in public service

agencies in particular has experienced many innovations and adjustment in accordance

with the reforms of economic and financial management However, the task of

accounting in public service agencies in general and in other organizations of the

General Department of Geology and Minerals of Vietnam had some shortcomings in

recording and the task of managing fixed assets faced much confusion, the accounting

apparatus in some organizations did not suit the characteristics, size and condition The

system of accounts, ledgers and reports as well as the implementation of information

technology failed to meet the managerial requirements The inadequacies in the task of

accounting in public service agencies greatly affected the management of finance and the

quality of public service

Based on these theories and practices, the author investigated and decided to

choose the research: “The task of accounting records in the public service agencies

under the General Department of Geology and Minerals of Vietnam”

1.2 The purposes of the study

(i) Systemize the basic theories regarding the task of accounting record in the

public service agencies

(ii) Survey and analyze of the current situation of accounting record in the public

service agencies of the General Department of Geology and Minerals of Vietnam

(iii) Evaluate the current situation of accounting record in the public service

agencies of the General Department of Geology and Minerals of Vietnam

(iv) Propose some solutions concerning two aspects: perfecting the legal

framework related to accounting to suit specific activities and structuring the autonomy

to the new requirements and implementing the task of accounting record in the public

service agencies of the General Department of Geology and Minerals of Vietnam

1.3 Research questions

The theoretical and practical issues show that the system of accounting

information is one of the useful management tools to help managers in public service

agencies manage and utilize the funds and capital as well as manage the public assets

The author raises the questions on how to strengthen the quality of accounting

information system in the public service agencies of the General Department of Geology and Minerals of Vietnam

1.4 Objects and scope of the study

1.4.1 Objects of the study

The dissertation focuses on studying the theoretical and practical basis on the task

of accounting record in the public service agencies of the General Department

of Geology and Minerals of Vietnam and then proposing solutions to improve the task of accounting record in the public service agencies of the General Department of Geology and Minerals of Vietnam

1.4.2 Scope of the study

Regarding the scope of research space: The dissertation focuses on the studying

the task of accounting record in unions and centers of the General Department

of Geology and Minerals of Vietnam

Regarding the content of the research: The dissertation focuses on surveying and

studying the task of accounting record in unions and centers of the General Department

of Geology and Minerals of Vietnam in terms of financial accounting Details as follows:

- Survey and study the accounting apparatus in the unions and centers of the General Department of Geology and Minerals of Vietnam

- Survey and study the accounting apparatus in the unions and centers of the General Department of Geology and Minerals of Vietnam in terms of accounting documents, system of accounting accounts, accounting ledger, reporting and applying information technology in accounting

Regarding the time of the research: The dissertation focuses on surveying and

collecting document on the task of accounting record in unions and centers of the

General Department of Geology and Minerals of Vietnam in 2013 and 2014

1.5 Research Methods

The author uses various synthetic methods such as: investigation, analysis and systematization method; survey and recording method; synthetic and sub-statistics method; comparison, interpretation and induction method; positive method, etc to study, analyze, evaluate and present the issues related to the task of accounting record in unions and centers of the General Department of Geology and Minerals of Vietnam

The dissertation also employs some specific methods in the research process, such as: comparison, interpretation and induction method and statistics method to analyze the theoretical and practical issues to provide assessment and conclusion, which helps to offer suitable and feasible solutions

1.6 Overview of the researches

The task of suitable and scientific accounting record provides useful and effective accounting information for the management and operation of financial and economic

activities in institutions and organizations in general and in the public service agencies in

particular Therefore, researches on the accounting record in public service agencies have

been mentioned in many research projects of Vietnam and other countries However, in

terms of the scope of research, these projects are primarily in Education, Health, and War

Invalids - Social Affairs There has not been any study on public service agencies the

General Department of Geology and Minerals of Vietnam In the context of Vietnam's

market mechanism-oriented economy, financial management of the organizations in the

General Department of Geology and Minerals of Vietnam, particularly, since 2006,

1.7 The structure of the study

In addition to the table of content, appendices and list of references, the

dissertation is divided into four chapters and the conclusion as follows:

Chapter 1: Introduction to the study

Chapter 2: Rationale of the accounting record in public service agencies

Chapter 3: The current situation of accounting record in public service agencies in

the General Department of Geology and Minerals of Vietnam

Chapter 4: The solutions to perfect the accounting record in public service

agencies in the General Department of Geology and Minerals of Vietnam

CHAPTER 2 RATIONALE OF ACCOUNTING RECORD IN PUBLIC SERVICE AGENCIES

2.1 Definition and meaning of accounting record

2.1.1 Definition of accounting record

There are many different views on accounting record According to the author,

“accounting record in organizations, enterprises and other social associations is the

process of establishing suitable relationships among factors that form a system including

accounting system, policies implementation, financial management, accounting methods,

accounting principles, means and methods of calculating in order to ensure that

accounting upholds its roles and functions”

2.1.2 Roles of accounting record

- Accounting record helps accountants collect, process and synthesize information

systems for those who are interested and helps them make right and prompt decisions

- Accounting record helps build a compact and efficient accounting apparatus

therefore perform data collection, processing and provision to the management promptly

and comprehensively

- Accounting record forms an important basis for the effective financial

management

- Accounting record also plays a particularly important role in the management and decision-making within the organizations

2.2 Factors affecting the accounting record in public service agencies

2.2.1 Characteristics and classification of public service agencies

2.2.1.1 Characteristics of public service agencies

Currently, the concepts of state administrative agencies and public service agencies often associate with each other and can be called the administrative agencies as follows:

According to the author, the state administrative agencies and public service agencies are different in functions State administrative agencies are organizations authorized by the government to directly provide public administrative services to people Public service agencies are organizations authorized by the government to provide some public services

2.2.1.2 Classification of public service agencies

Currently, classification of public service agencies according to criteria in table 2.1 including sectors, financial management, sources of revenue and the extent of financial autonomy Depending on the different management requirements in each agency, a particular system of financial statements can be built to reflect differences of accounting objects Therefore, classification of public service agencies needs to be analyzed in during the process of accounting record

2.2.2 Regulatory environment

The fundamental factors affecting accounting record in public service agencies are accounting law, decrees and circulars guiding the implementation of accounting and legal documents related to public services and accounting activities such as laws on tax, officer and budget It is important that legal documents concerning accounting and finance should be thoroughly followed to apply in each public service agencies to suit its characteristics

2.2.3 Demand of accounting information in public service agencies

Accounting record in public service agencies must meet the demands of

accounting information from managers Demands of accounting information in public service agencies include financial accounting and managerial accounting information

2.2.4 Forms of management apparatus in the public service agencies

Currently, public service agencies can choose one of three forms of management

as follows:

- Online management apparatus: each subordinate member is only under the

management of one immediate superior

- Functional management apparatus: Each agency or department is in charge of

specific management tasks The staff must be knowledgeable and professional in their

field

- Mix management apparatus: A type of management that mixes online and

functional management apparatuses

2.2.5 Features of financial management in the public service agencies

2.2.5.1 Mechanism of financial management in the public service agencies

- Yearly estimated financial management mechanism is the traditional mechanism

applied before 2002 The public service agencies base on the functions and tasks

assigned as well as the standards of government to estimate revenues and expenditures

within a year; the estimates are in absolute compliance with the standards set by the

government within the approved cost estimates; Estimated settlement under this regime

complies with the items in the index of state budget which corresponds to each expense

content, and all remaining expenses must be returned to the state budget or reduced in

the next year’s estimated costs except for exceptional cases

- The mechanism of financial autonomy is based on view that the agencies using

the finance are operating in a flexible manner instead of yearly financial management

mechanism which has been long imposed by the government Currently, the operations

of public service agencies are compliant with the Decree 43/2006/ND-CP dated

25/4/2006 on "Regulations on autonomy and self-responsibility for operation,

organizational structure, staffing and finance in public service agencies" Accordingly,

the autonomy and self-responsibility are given to public service agencies in organizing

work, rearranging apparatus, using human and financial resources to complete the tasks

assigned; promoting every capability to provide high-quality service to society;

increasing revenue in order to gradually bring about the income for workers

2.2.5.2 Innovation in autonomy management mechanism in the public service agencies

On 14/02/2015, the Government issued Decree No.16/2015/ND-CP concerning

the autonomy mechanism of public service agencies to replace Decree No

43/2006/ND-CP According to the new requirements of the Decree No 16/2015/ND-CP, every

accounting record must be adjusted as: The whole public service charges when

transferring public services prices in the field of geology must use the service invoice

instead of receipts, revenues at current prices of public services are recorded as revenue

instead of charges according to charging ordinance

2.3 Principle and requirements of accounting record in public service agencies

2.3.1 Principle of accounting record in public service agencies

In order to perform its information and testing functions, the accounting record in

public service agencies needs to abide by the following principles:

First - The principle of consistency

Second - The principle of suitability Third - The principle of compliance with mechanism, policies and law system on accounting and financial management in public sectors

Fourth - The principle of economization and effectiveness

Firth - The principle of non-pluralism

2.3.2 Requirements of accounting record in public service agencies

Accounting record in public service agencies needs to ensure the following requirements: control, effectiveness, suitability and flexibility

2.4 Basic content of accounting record in public service agencies

2.4.1 The accounting system in public service agencies

The accounting system is the gathering of accountants and technical means of recording and calculating which are equipped to perform the whole accounting task from summarization, analysis and supply of economic information as well as activities of managerial agencies

2.4.1.1 Requirements of accounting system

∗ Accountants

Accountants need to meet the requirements of qualifications and ethic They have a thorough understanding and comply with laws, policies, accounting system and other requirements within the agencies The human resources in accounting department are required to have both ability to work in group and good relationships with other departments in the agencies, enterprises and organizations

∗ The organization and assignment of accounting task

The assignment of accounting task needs to ensure recording, processing and providing prompt and accurate information, the equity in terms of workload assigned to each accountants and smooth upward and downward management relationships

∗ Internal management and control

The accounting system needs to ensure the close control to meet the requirements of internal management and control, especially in control procedure in computing environment It is essential to clearly distinguish the functions of accounting system and abide by task assignment principles

2.4.1.2 Basis for accounting system in public service agencies

The accounting system in public service agencies in the computing environment must examine the following points:

∗ The managerial structure of public service agencies

∗ The accounting workload

2.4.1.3 The organization of accounting system and human resource structure in

accounting department

a The organization of accounting system

The agencies can choose one of the accounting system models including

centralized, decentralized and mix models

b The assignment of accounting task

The assignment of accounting task is defined as allocating the task to staff based

on the workload and the level of complication as well as the professional ability of each

staff

2.4.2 The system of accounting document

The system of accounting document includes:

First - Identifying the system of accounting document at the agencies: Based on

the state’s accounting system (the Ministry of Finance) and the characteristics and

managerial requirements of accounting objects, the content of activities, businesses,

economic transactions and finance to identify the document employed at the agencies

Second – Organizing initial accounting: The agencies establish regulations on

documents, investigating, classifying and generalizing documents Accounting

documents must be lawful, rational, and valid and ensure truthfulness and objectivity

Third – Transferring documents: This is the next step of the process of gathering

initial information Scheduling document transfer is defined as designing the way of each

type of documents to the accounting department concerned

Fourth - Storing, preserving and destructing documents: Documents after being

used to record in the accounting books Storing and preserving accounting records must

comply with the general provisions of the Law on accounting

2.4.2.2 Organization of accounts system

Each agency should organize the system of accounts to serve the systematization

of information and ensure the scientism and efficiency of accounting There are many

different views on the organization of accounts system

According to the authors: ''Organization of accounts system is the task of applying

the system of accounts under current regulations into the acquisition and systematization

of information to be consistent with the characteristics and requirements of

management''

The content of organization of accounts system as follows:

First – Determine the general and detailed account list employed at the agency in

terms of financial accounting and managerial accounting

Second – Determine the content, structure and scope of notes on the general and

detailed accounts

2.4.3 Organization of ledger system

According to the authors: “Organization of ledger system is to establish and build the structure and how to take notes on the ledger system in accordance with the system

of accounts and managerial requirements of accounting record”

Public service agencies may choose one of the following forms of accounting:

- Form of Journal - Ledger

- Form of Document far book entry

- Forms of General Journal

- Form of computerized accounting

2.4.4 Organization of financial statement and financial statement analysis

2.4.4.1 Organization of financial statement system

According to the author, the content of organization of financial statements includes:

(i) The selection and design of financial statement: financial statement is a consistent and compulsory accounting report Each agency must choose the forms and the quantity of report, which complies with the provisions of the current accounting regime

(ii) The organization of presenting information on financial statements is the task

of establishing accounting reports This stage includes: determining the reporting period; preparing of data resources, forms and technical means of establishing reports; forming a report in accordance with the principles and specific guidance on establishing and presenting the financial statements provided in the current accounting regime

2.4.4.2 Analysis of financial statements

Accounting record in public service agencies needs to analyze the current situation

of using funds, revenues and expenditures based on the method of comparison which analyzes an indicator by comparing it with a ground index (the original index)

2.4.5 Organization of accounting inspection

According to Article 4, Clause 10 of the Law on accounting: “accounting inspection is the task of reviewing and assessing the compliance with the law on accounting, the truthfulness and accuracy of information and accounting figures''

Contents of accounting inspection: According to Article 35 of the Law on

accounting: the agency must be subject to inspection by the competent accounting agency with no more than one inspection of the same content in one year The accounting inspection is conducted only after the decision of the competent authority in accordance with law

2.5 Accounting standards applied to the public sector and lessons for Vietnam

2.5.1 The definition of accounting standards

Public Sector Accounting Standards provides provisions related to the recognition,

evaluation, presentation and announcement of the transactions and events in the financial

statements of the public sectors [12, p24]

2.5.2 The system of international accounting standards

Up to now, the Committee of international accounting standards for the public

sector (IPSASB) of the International Federation of Accountants (IFAC) has issued 32

accounting standards for the public sector, which is known as Standard international

public accounting

In the trend of international economic integration, to harmonize and develop the

accounting profession globally, the goal of improving the quality of financial statement

systems has been strengthened worldwide IPSASB issued IPSASs to encourage

acknowledgement and international harmony with these standards Simultaneously, it

also issued guidelines addressing the issues and experience in forming financial

statements in the public sector

2.5.3 The application of international accounting standards in several countries

around the world

The accounting standards applied by some countries in the organization for

economic cooperation and development (OECD) with the contents of accounting,

reporting and budgeting are listed in Table 1.1 (Appendix 13)

Therefore, it can be said many countries around the world have been applying the

international accounting standards or based on these accounting standards for the

construction of the national accounting standards applicable in their country

2.5.4 Lessons for Vietnam

Based on studies on IPSASs and the application of PSASs in some countries in the

world, lessons can be drawn for Vietnam To be detailed, the state agency with

jurisdiction, especially the Ministry of Finance must study, identify targets and subjects

to be applied the public accounting standards in Vietnam then develop a roadmap for

studying and building to enact public accounting standards in VN which suit our

country’s economic, political and social conditions

2.5 International accounting standards applied for public sector and Empirical

lessons for Vietnam

2.5.1 Definition of international public sector accounting standards

International public sector accounting standards (IPSASs) released provisions

related to recognition, evaluation, presentation and declaration transactions and events in

general financial report of public sectors [12, p24]

2.5.2 The system of international public sector accounting standards

So far, the International Public Sector Accounting Standards Board (IPSASB) of International Federation of Accountants (IFAC) has released 32 accounting standards public sectors, also called international public sector accounting standards

In the trend of international economic integration, to harmonize and to develop global accounting career, with the aim of improving the quality of International Accounting Reporting Standards IPSAB has released IPSASs, encouraging the international recognition and harmony of these standards It has also released instructions for issues and experience when making financial report in public sector

2.5.3 The application of international public sector accounting standards in some countries in the world

The application ofinternational public sector accounting standards in some countries in the Organization of Economic Cooperation and Development, according to accounting contents, reports and national budget was shown in Table 1.1 (Appendix 13)

It can be said that many countries in the world has been applying international public sector accounting standards or based on them to build national public sector accounting standards to suitably apply in their countries

2.5.4Empirical lessons for Vietnam

Based on researches on IPSASs and the application in PSASs in several countries

in the world, some empirical lessons can be drawn for Vietnam, i.e authorized state agencies, especially the Ministry of Finance, must research on and determine objectives and objects applied in Public Sector Accouting Standards in Vietnam Thereby, researching procedures to promulgate in Vietnam can be suiable for economic and socio-politic conditions of our country

CHAPTER 3 REALITY OF ORGANIZING ACCOUNGTING RECORDS

AT PUBLIC SERVICE AGENCIES UNDER THE GENERAL DEPARTMENT OF GEOLOGY AND MINERALS 3.1 An overview of Public Service Agencies of the General Department of Geology and Minerals

3.1.1 Structural system

According to the structure of General Department of Geology and Minerals, there are an assisting apparatus for General Director and 14 subordinate units The summary of the structure of General Department of Geology and Minerals is in figure 3.1., for more details see appendix 14

* According to functions and responsibilitiesof assisting apparagus under General

Department of Geology and Minerals, including functions and responsibilities of Public

Service Sectors under General Department of Geology and Minerals, which are

federations, centers, geological museums and geologic magazines

- Under General Department of Geology and Minerals,there consists of 9

federations, Geological Federation of Regional Map, Geological Federation of Southern

Map, Geological Federation of Southeast Map, Geological Federation of Northwest

Map, Geological Federation of North Central Map, Geological Federation of Central

Map, Federation of Intergeo, Geological Federation of rare radioactive substance and

Geophysical Federation

- Centers:There are 3 ones, Center for Geologic Storage, Analytical and

Exprimental Center for Geology and Center for Geologic Testing and Technology

3.1.2 Funtions and responsibilities

3.1.2.1 Funtions and responsibilities of Federations

Federations under General Department of Geology and Minerals are characterized

as follow:

Firstly, they are the public sectors under General Department of Geology and

Minerals which have legal entity seals, accounts and headquarters to perform basic

geologic survey and mineral exploration within the mainland

Secondly,mineral explorationactivities of those federations are paid by state

budget, not directly reimbursed In addition, they are encouraged to provide

organizations and individual with public service activities in mineral exploration, under

the regulations of self-financing and to contribute to increase income for workers

Thirdly, the federations are originated from subordinate sectors, i.e delegations

and main centers Therefore, they have effects on organizing management apparatus and

financial decentralization

3.1.2 2 Funtions and responsibilities of centers

Centers underGeneral Department of Geology and Minerals are characterized as

follow:

Thứ nhất: they are the public sectors under General Department of Geology and

Minerals which have legal entity seals, accounts and headquarters to cooperate with

federations to perform basic geologic survey and mineral exploration within the

mainland in execution supervising, checking and testing over weight and quality of

geological projects, storing information and analyzing samples, etc

Secondly, the centers under General Department of Geology and Minerals are the

ones performing professional duties under prescription They are funded by state budget,

not directly reimbursed In addition, the centers are encouraged to provide geologic

service activities, under the regulations of self-financing and to contribute to increase savings income for their staff

Thirdly, they are formed to cooperate and assist federations in basic geologic investigation, mineral exploration within the mainland

3.1.3 Management system

To well perform the functions and responsibilities in providing public geologic service, federations and centers have to organize management apparatus so that it is suitable for their own performing characteristics According to results of General Department of Geology and Mineralsweb access, models of management apparatus are

as follow:

* Federation management model The management apparatus of federations consists of federation leaders, assisting apparatus for federation chief and subordinate sectors

* Centers are the public sectors under General Department of Geology and Minerals which have legal entity seals, accounts and headquarters to cooperate with federations to perform testing and analysis, information storage, geologic technology accreditation

3.1.4 Financial management

3.1.4.1 Financial management mechandism

Since 2007, the decree No 43/2006/NĐ–CP issued on 25/04/2006 by governmentprescribed autonomy, self-responsibility for task performance, organizational apparatus, payroll and finance to puclic sectors (referred to as Decree 43), 100% of public sectors under General Department of Geology and Minerals was granted autonomy on spending on the entire regular activities

* Decree 43 allowed these sectors to be autonomous in development and implementation of cost estimates consistent with practical requirements and in independent setting and using funds for business activities, bonus, welfare, and income stabilization reserves and additional income for workers

3.1.4.2 Financial management

* Financial sources

According to statistics of geology and mineral Vietnam, financing structure of economic sectors (federations and centers) under General Department of Geology and Minerals is shown in figure 3.1

Nguồn: Tổng Cục Địa chất và Khoáng sản Việt Nam

It is shown that financial autonomy has contributed to encourage public sectors

under General Department of Geology and Mineralsto actively complete tasks under

State orders and to find and implement the contract of geologic production service

businessto improve the effectiveness of geological supply and the living standards of

workers

3.2 Reality in organizing accounting at public sectors under General Department

of Geology and Minerals

3.2.1 Organizing accounting apparatus

3.2.1.1 Forms of organizing accounting apparatus

Models of organizing accounting apparatusat these sectors can be generalized as

follow:

- Organizing centralized accountingmodel: This accounting model has been

applied at four out of twelve sectors (the Geological Federation of Northern Map and

three centers), accounting for 30% of the total surveyed sectors, according to diagram

3.5 (see appendix 18 for more information)

- Organizing distributed accounting model: According to the survey, there are

two federations organizing distributed accounting (Geological Federation of Northwest,

Geological Federation of rare radioactive substance), making up 16.66

- Organizing both centralizedand distributed accounting model: This model has been

set up at most of the federations, including six out of twelve sectors, accounting for

more than 50% surveyed sectors (Geological Federation of Southern Map,Geological

Federation of Northeast Map, Geological Federation of North Central Map, Federation

of Intergeo, Federation of Central Map and Geophysical Federation) as shown in

diagram 3.7 (see appendix 20 for more details)

Three centers underGeneral Department of Geology and Minerals have applied

centralized accounting model This accounting model is suitable for the size and

management characteristics of these sectors

3.2.1.2 Funtions and responsibilities of accounting apparatus

Figure 3.1 Financing structure of puclic sectors under General

Department of Geology and Minerals between 2009 and 2013

According to the surveyed results at the federations, the centers underGeneral Department of Geology and Minerals have statistical accounting department including parts of accounting and economic apparatus of subordinate sectors The functions and responsibilities of accounting apparatus are as follow:

3.2.1.3 HR organizational structure and accounting work division

a HR organizational structureat accounting department of federations and centers

According to interviews, federations and centers under General Department of Geology and Minerals Vietnam has established the structure of accounting department based on processing and accounting objects

b Assigning accountant tasks

How tasks are are assignedaccountants to accountants at federations and centers is suitable for the accounting apparatus fulfill the mandates

3.2.2 Accounting structure at public service sectors

3.2.2.1 Organizing system of accounting document

According to the results of the survey on organizing system of accounting document at public service sectors under General Department of Geology and Minerals Vietnam, based on documents issued by Decision No 19/2006/QĐ –BTCdated 30/3/2006 by Minister of Finance, amended under Circular No 185/2010/TT-BTC dated15/11/2010 to give instructions on accounting regulations of public service sectors issued byDecision No.19/2006/QĐ –BTCdated 30/3/2006 by Minister of Finance and special geologic document, released by Official Dispatch No 4792/ BTNMT – KHTCdated 30/12/2004 on additional geologic accounting system of public sector by Ministry of Natural Resources and Environment (referred to asDispatch No 4792/ BTNMT – KHTC)

3.2.2.2 Organizing account system

Federations and centers General Department of Geology and Minerals Vietnam has organized a system of accounts for the sectorsm based on the system of accounts prescribedat accounting system, released under Decision No 19/2006/QĐ –BTC, amended under Circular No 185/2010/TT-BTC, based on specific characteristics of evert sector to establish a system of accounts in their own sectors

The results of the survey has shown that accounts generally used at the sectors are detailed as specified in the system regulations issued under Division 19/2006/QĐ-BTC However, the sectors hasn’t attached special importance to open detailed accounts to serve internal administration

3.2.2.3 Organizing a system of books

Through the surveyed results, Federations and centers underGeneral Department

of Geology and Minerals Vietnam has organized the system of books as follow:

Firstly,All federations and subordinated sectors choose to use the form “booking

entries” and has computerized accounting work.These sectors hired Mr Phạm Hữu

Thắng – chief accountant ofGeneral Department of Geology and Minerals Vietnam to

write the accounting software named “AC -2005” which has been used since 2006

Secondly:A list of accounting book samples used at the sectors consists of the full

list of accounting books issued by decision 19/2006 / BTC, amended by Circular No

185/2010/TT-BTC the list of accounting books specialized for geology, issued by

Circular No 4792/ BTNMT – KHTC

Thirdly: The order of accounting book entries of the sectors

According to results of the survey, Federations and Centers has computerized

accounting and has been using “AC 2005” software Booking entries at these sectors are

all done on this accounting software Accounting statistics are generalized on Excel

which can connect data from delegations (subordinate sectors) with federal statistics

Ledger for supplies and fixed assets are done on excel

3.2.2.4 Organizing accounting reporting system and financial statements analysis

a Organizing accounting reporting system

All sectors fully complied financial reports in 2013, in accordance with the forms

prescribed, which are 10 financial reportsissued by Decisions 19 and 4 reported by

Dispatch No 4792 Basically, those financial reportsreflect correctly economic and

financial reality, meeting the deadline at the end of March 2014 as prescribed However,

observing financial reports of surveyed sectors shows that the notesto the financial

statements in 2013 insufficiently reflected some indicators

b Organizing financial statements analysis

Through survey, federations and subordinate sectors organized financial analysis

and set up specific plans to put the analysis process in order Through statistics and the

results generalized in annual financial reports, the sectors collate, calculate and compare

related statistics to evaluate the financial management The contents of the analysis focus

on analyzing the estimates of revenues - expenditures, funding status and settlement,

assetsmanagement and use

3.2.2.5 Organizing accounting inspection

Accounting inspection in federations General Department of Geology and

Minerals Vietnamincludes internal self-inspection of accounting apparatus and external

inspection of authorities and related parties

3.3 Evaluation on the reality of organizing accounting in public sectors under

General Department of Geology and Minerals Vietnam

3.3.1 Advantages of organizing accounting in public sectors

Firstly, organizing accounting apparatus

The selection of current accounting modelis relatively suitable for management

conditions and scale of the sectors All accountants are assigned based on academic ability, ensuring proper professional standards as prescribed Accountants at federations are high qualified, meeting current criteria as prescribed and the number of senior staff make up high proportion

Secondly, organizing accounting

About organizing accounting documents,the establishment of accounting documents greatly contribute in controlling revenues and expenditures and the management and use fixed assets Thereby, the management of revenues and expenditures are enforced so as to increase the effectiveness in using fixed assets and other resources

About organizing accounts, the organization of the system of financial and accounting accounts fully met the requirements of managing and controlling irregular expenditures, expenditures for performing professional duties of geology, for geologic business service, contributing to strict management of revenues and expenditures, and to use fixed assets and resources properly

About organizing accounting report, the process of financial reporting of surveyed sectors basically abode reporting procedures, ensuring right contents and forms, etc This creates advantages for inspection, annual financial appraisal as prescribed by the State, contributing to the effectiveness of assets, supplies and expenditure management and use

- The number of units having inadequate bookkeepings in pursuance to the current

accounting regime

- Some bookkeepings are designed unscientifically, inaccurately, unsuitably for

specific charactiristics of business activities in the PSU

- The sample of detailed accounts (form S33-H) is not accordant with the practice

For organizing accounting statements: the actual survey findings indicated that

some existing problems in the accounting report system in the Federations were:

- Contents of some reports like the FS on revenues and expenditures were unreasonable and unscientific

- Making Balance sheets followed the form B01-H was only formally, had little effect in providing information about the financial affairs

- According to the survey, making notes to financial statements was fully taken care

of its content, analysis and causal assessment to help readers correctly understand about the financial affairs

3.3.3 Causes of limitations in organizing accounting in the PSU

* Objective reasons:

Currently, the PSU of the DGMV are consistent with the application of administrative and non – business accounting regime according to Decision No

19/2006/QD-BTC dated 3rd March 2003 and Circular No 185/2010/TT-BTC dated 14th

December 2010, of the Ministry of Finance, which provides guidance for amendment

and supplement of administrative and non – business accounting regime Although

accounting regime was amemded these shortcomings and added new contents, it has not

met the requirements of practical development

* Subjective reasons:

- The leader’s concepts about the role of accounting in general and accounting system in

particular are slow to renovate

- The coordination between accounting department and other parts has not been closed,

which makes turnover problems, checks and treatments of voucher unscientific,

unreasonable and tardy

- Accounting in the PSU of the DGMV has not been carefully studied the current Law

system and guidance documents, then when applying to accounting works, this

application is not pursuant to the rules

- The PSU of the DGMV have not used IT efficiently in organizing accounting

CHAPTER 4: THE ORIENTATION AND SOLUTION FOR ACCOUNTING

RECORDS IN PUBLIC SERVICE UNITS DIRECTLY UNDER THE GENERAL

DEPARTMENT OF GEOLOGY AND MINERALS OF VIETNAM

4.1 The strategic orientation of minerals and the basic geological survey plan to

2020, with visions to 2030

4.1.1 Strategic orientation of minerals until 2020 and vision to 2030

Prime Minister has approved the strategy for mineral resources to 2020 with a

vision toward 2030 with one of directive viewpoints: the survey and evaluation of the

mineral resources must be implemented in advance to clarify the potential of mineral

resources for planning exploration, exploitation, processing, and use of mineral resources

and national reserves

The strategy prioritizes for investment in basic survey of geological minerals both

land and sea and islands in order to clarify the potential mineral resources; exploration

and exploitation of minerals associated with processing and efficient use Balance

between exploitation with reserce of minerals, sustainable development of mining

industry associated with the environmental protection and ensuring national defense –

security

The objective of this strategy is that mining of mineral must be associated with

processing, creating products of high economic value; to 2020 it shall terminate the

facilities processing minerals scattered, outdated technology, low economic efficiency

and contaminating environment; forming the industry zones processing minerals

concentrated with advanced technology, the scale corresponding to potential of each type

of mineral

4.1.2 The plan on basic geological survey of mineral resources until 2020 and vision to

2030

The plan on basic geological survey of mineral resources until 2020 with orientations toward 2030 has just been approved by the Prime Minister in Decision No 1388/QD-TTg dated 13th August 2013 with the viewpoint following: to plan the survey and discovery of minerals together with the making of maps of area geology, hazard geology, environmental geology, marine geology and mineral resources, and geological and mineral research maps of 1:50,000 scale for the mainland and of 1:500,000 or larger for Vietnam’s maritime zones along with detailed surveys, aiming to clarify the structure, genesis and development of the earth’s crust to serve socio-economic development, national defense and security demands

4.2 The concept of completing accounting records in public non – business units directly under the General Department of Geology and Minerals of Vietnam

Accounting organization (AO) in public service units (PSU) directly under the General Department of Geology and Minerals of Vietnam (DGMV) needs to implement following the oriented concepts:

Concept 1: Completing of organization of accounting activities in the PSU directly under the DGMV must go together with improving the mechanism of financial management and rasing awareness, promoting the important role of accounting in both macro and microscale in financial management works

Concept 2: Completing of organization of accounting activites in DGMV subordinate units must be pursuant to provisions of the Accounting Law, the current accounting regime and guidance on the implementation of the Law

Concept 3: Completing the accounting organization has to ensure compliance with not only the governance and administration system at all levels but also the operational characteristics of the PSU directly under the DGMV

Concept 4: Completing of organization of accounting activities has to base on the application of modern information technology, ensure cost savings and increase the labor productivity

4.3 Solution for accounting organisation in the PSU directly under the DGMV

4.3.1 Completing the legal framework for finance and accounting applicable to public non – business units

4.3.1.1 Studying, developing and promulgating accounting standards applicable to the public sector as the basis for preparing and presenting financial statements

To deploy the General State Economy (GSE) model and have the legal basis for the preparation of the State Financial Statement (FS) (synthesized from FSs of all public sectors such as State agencies, the PSU and other organizations controlled by the Government) The Ministry of Finance should urgently study, develop and promulgate

the accounting standards in accordance with the international accounting standard

system, according to the suitable process with Vietnamese conditions

4.3.1.2 The Ministry of Finance should urgently study, develop and issue accounting

standards applicable to public service units

Due to limited scope of the thesis, the author suggests contents of some accounting

standards for fixed assets (FA) and revenues and inventories:

4.3.1.3 Completing the financial regime on the FA management and use in the public

sector

In short- term, without studying and issuing the public accounting standards, it is

necessary to urgently supplement, amend the financial regime on the public assets

management and use for inadequate contents in Circular No.162/2014/TT-BTC

4.3.2 Completing the accounting organization in the PSU directly under the DGMV

4.3.2.1 Completing the organization of accounting system in the PSU

The Federations of the DGMV should apply uniformly the decentralized

accounting model according to figure 2.6 Applying currently centralized model in

centers is the most correspondent with the reality, which contributes to enhance the

efficiency of financial management under the autonomy mechanism

Table 4.1: Mixed model

4.3.2.2 Improvement of organizing accounting activities in the PSU

(1) Solutions of completing organization of accounting voucher system

This improvement needs to perform and overcome shortcomings in the

implementation process in accordance with the current regulations of the State

Specifically:

Other functional deparments

Building norms

Indentifying spent resources based on kind and labor

Identifying estimates of kind and labor

Managerial accounting

Estimates

Analysis, assessment

Project research

Financial accounting

Financial accounting

Payment accounting

Banking accounting

…

General accounting

Firstly, names of some vouchers need to be amended to match with their reflecting contents

Secondly, the preservation and storage of vouchers

Agencies should locate the standard storage room for accounting records and these accounting records need to be backed up to CD ROMs, USB and performed the preservation and storage regime as regulations

2) Completion of organizing chart of accounts

Chart of accounts applicable to the PSU directly under the DGMV need amending and adding some contents in two groups of solutions:

First, completing the current chart of accounts, open more detailed accounts for

internal management, specifically in appendix 35

Second, perfecting the output accounting of instruments and tools to subtainably use for operations

Fixed assets (FA) in Vietnamese Geology and Minerals entities used a lot of instruments, tools over many accounting periods such as drilling rod, drilling casing, drilling bit, locality…) These instruments are classified as subtainable tools; however, when agencies use these tools in their works, the costs calculated in the total expenditures without gradual distribution, which did not follow the rules With these long lasting instruments, agencies make out an account pursuant to regulations issued on Decision No 19/2006/QD-BTC

3) Completion of applying bookkeeping system and accounting types

Bookkeeping system of the PSU directly under the DGMV also needs to improve Namely:

First, amending the form of detailed accounts S33-H compliant with the practice Second, supplementing some detailed bookkeepings

4) Completion of organizing accounting reports

I propose some solutions to improve FS system in the PSU directly under the DGMV as followings:

Firstly, completing revenue and expenditure reports of non-business activities and

business activities – Sample B03-H (appendix 42)

Secondly, completing Balance sheets

The author said that Balance sheets should be designed as appendix 46 with supplements, amendments following:

(1) Reorganizing and guiding to make indicators related to receivables and payables