Quyết định 479/2004/QD-NHNN

DECISION

ON PROMULGATING THE SYSTEM OF BOOK-KEEPING ACCOUNTS OF CREDIT INSTITUTIONS

THE GOVERNOR OF THE STATE BANK

Pursuant to the Law on credit institutions No. 02/1997/QH10, of December 12, 1997;  

Pursuant to the Accounting Law No. 03/2003/QH 11, of June 17, 2003;;

Pursuant to the Government’s Decree No. 86/2002/ND-CP of November 05, 2002, defining the functions, tasks, powers and organizational structure of Ministries, Ministerial-level agencies;    

On the consent for promulgation of the system of book-keeping accounts of the Ministry of Finance at the Official Dispatch No. 1138 TC/CDKT, of February 05, 2004;

At the proposal of Director of Accounting – Finance Department.

DECIDES:

Article 1. To promulgate together with this Decision THE SYSTEM OF BOOK-KEEPING ACCOUNTS OF CREDIT INSTITUTIONS

Article 2. This Decision takes effect on October 01, 2004 and replaces the following Decisions:

- The State Bank Governor's Decision No. 435/1998/QD-NHNN2 of December 25, 1998 promulgating the system of book-keeping accounts of credit institutions.

- The State Bank Governor's Decision No. 522/2000/QD-NHNN2 of December 20, 2000 adding accounts and amending a number of provisions on foreign-currency accounting in the system of book-keeping accounts of credit institutions.

- The State Bank Governor's Decision No. 224/2001/QD-NHNN of March 23, 2001 canceling financial balance sheets of credit institutions promulgated together with Decision No. 435/1998/QD-NHNN2 of December 25, 1998.

- The State Bank Governor's Decision No. 482/2001/QD-NHNN2 of April 24, 2001 amending and adding a number of accounts in the system of book-keeping accounts of credit institutions.  

- The State Bank Governor's Decision No. 559/2002/QD-NHNN of June 3, 2002 adding a number of accounts to the system of book-keeping accounts of credit institutions.  

- The State Bank Governor's Decision No. 69/2003/QD-NHNN of January 22, 2003 adding a number of accounts to the system of book-keeping accounts of credit institutions.

Article 3. The Chief officers, Director of Accounting-Finance Department, heads of units under the State bank of Vietnam, Directors of the State bank’s branches in central-affiliated cities and provinces, presidents of Board of Directors, Directors general, Directors of credit institutions shall implement this Decision. 

THE SYSTEM

OF BOOK-KEEPING ACCOUNTS OF CREDIT INSTITUTIONS
(Promulgated together with the Decision No. 479/2004/QD-NHNN, of April 29, 2004 of the Governor of the State bank) 

I. GENERAL PROVISIONS

1. This system of book-keeping accounts shall apply to credit institutions that are established and operated under the Law on credit institutions.

2. The credit institutions shall be entitled to open and use accounts provided for in the System of book-keeping accounts only after they have had regime on professional operations and in accordance with contents in the issued operation license.

3. The system of book-keeping accounts of credit institutions includes accounts inside accounting balance sheets and accounts outside accounting balance sheets that are set into 9 categories:

- The accounts inside accounting balance sheets include 8 categories (from category 1 to 8).

- The accounts outside accounting balance sheets include 1 categpry (catelory 9).

- The accounts inside accounting balance sheets and accounts outside accounting balance sheets (hereinafter abbreviated as accounts inside balance sheets and accounts outside balance sheets) are set under the system of decimal numbers with many levels, from the level-I account to the level-III account, of symbols from 2 to 4 numbers.

- The level-I account is symbolized by 2 numbers from 10 to 99. Each account category shall be set not more than 10 level-I accounts.

- The level-II account is symbolized by 3 numbers, two first numbers (from left to right) are numbers of level-I account, the third number is ordinal number of level-II account in level-I account, symbolized from 1 to 9.

- The level-III account is symbolized by 4 numbers, three first numbers (from left to right) are numbers of level-II account, and the forth number is ordinal number of level-III account in level-II account, symbolized from 1 to 9.

The level-I, level-II, level-III accounts are general accounts provided by the Governor of the State bank, used as basis for accounting entries at credit institutions.

3.1- Regarding the open and use of level-III accounts:

3.1.1- For credit institutions with capacity to apply informatic technologies in accounting, management and monitoring of norms of level-III accounts, ensuring accuracy, timeliness and fullness, on that basis, making reports of all kinds in accordance with current regulations of the State bank, the open and use of level-III accounts specified in this System of book-keeping accounts are not compulsory, they can use directly the level-II accounts provided by the Governor of the State bank for accounting entries; or open the level-III, level-IV, level-V accounts under particular nature and management requirement of their organizations. In order to implement this regulation, credit institutions must:

- To have specific professional operation process and software meeting technical standards in accordance with current regulation for:

+ Settle accounting entries of operations arising in accordance with regulation of accounting standards and regimes;

+ Summarize, make and send kinds of reports that are provided for by state and the State bank.

- Having the written approval of the State bank before implementation.

The Accounting – Finance Department of the State bank is focal agency in charge of coordination with the Technology and Informatic Authority of the State bank, the monetary policy department, Inspectorate of the State bank as well as relevant Authorities and Departments of the State bank to consider, submit to the Governor of the State bank for the approval for eligible credit institutions to open and use the level-III accounts as prescribed in point 3.1.1 above.

3.1.2- For credit institutions that cannot apply informatic technologies in accounting, management and monitoring of norms of level-III accounts, the open and use of level-III accounts as provided for by the Governor of the State bank are compulsory.

3.2- The level-IV, level-V accounts are general accounts provided for by General Directors, Directors of credit institutions in order to meet specific requirements on accounting entries of operations arising of each credit institution. The supplementation of level-III accounts (for credit institutions permitted as prescribed in point 3.1.1), level-IV, level-V accounts and so on must be suitable with nature, content of the level-I, level-II, level-II accounts provided by the Governor of the State bank.

3.3- Before applying, credit institutions (except the people's Funds at grassroots level) must send the System of book-keeping accounts of their organization to the State bank of Vietnam (the Accounting – Finance Department) for report.

4. Currency symbols: In order to distinguish Vietnam dong, foreign currency and between various foreign currency types, credit institutions shall use the currency symbols: (i) by number (symbolized from 00 to 99) to record at the right side next to the number of general account; or (ii) by letters (such as: VND, USD, so on) . The specific currency symbols are prescribed in the Annex together with this System of book-keeping accounts.

5. Accounting entries of detailed account symbols The detailed accounts (sub-accounts) used for monitoring, detailing objects accounting of the general accounts. The open of detailed accounts complies with regulation at the content related to accounting entries of accounts.

Method to record symbol of detailed accounts:

Symbol of a detailed account inludes 2 parts:

- The first part: Number of general account and currency symbol.

- The second part: Ordinal number of sub-account in the general account.

If a general account has less than 10 sub-accounts, the ordinal number of sub-accounts is symbolized by a number from 1 to 9.

If a general account has less than 100 sub-accounts, the ordinal number of sub-accounts is symbolized by two numbers from 01 to 99.

If a general account has less than 1000 sub-accounts, the ordinal number of sub-accounts is symbolized by three numbers from 001 to 999.

Quantity of numbers of a sub-account in a general account compulsorily write in unified way as prescribed above (one, two, three numbers) But it is not compulsorily required to write in unified way for quantity of the numbers of sub-accounts among various general accounts.

The ordinal number of sub-account is written at the right of number of general account and currency symbol. Between the number of general account, the currency symbol and the ordinal number of sub-account, a dot (.) shall be written for distinction.

Example: Account 4221.37.18

4221 means number of general account - demand deposits in foreign currency of domestic customer.

37 means currency symbol (USD).

18 means the ordinal number of sub-account of unit, individuals deposit.

The ordinal number of sub-account of unit opening account that has stopped operation and finalized settlement, however it must be after at least one year to be permitted to use for opening account of other unit.

6. Method of accounting entries on accounts:

6.1- Accounting entries on accounts inside accounting balance sheets is performed under the method of double entry bookkeeping (Debt – Credit). Accounts inside accounting balance sheets are classified into three categories:

- Assets belong to the Credit assets always have Debit balance.

- Assets belong to the Debt assets always have Credit balance.

- Assets belong to the Debit-Credit assets may have Credit balance, Debit balance or both of balances.

When make the monthly and annual account balance sheet, credit institutions must reflect fully and accurately on the nature of account balances above (for accounts belong to Credit asset and accounts belong to Debit asset) and not be permitted to make clearing between Debit and Credit balances (for accounts belong to Debit-Credit asset).

6.2- Accounting entries on accounts outside accounting balance sheets is performed under the method of single entry bookkeeping (Entry-Exit-Remaining).

7. The terms of “domestic” and “overseas” prescribed in this system of book-keeping accounts are construed as terms of "residents" and “non-residents” specified in the Government’s Decree No. 63/1998/ND-CP of August 17, 1998, on foreign exchange management and apply uniformly as follows:

- "Domestic credit institutions” mean credit institutions of residents including:

+ Vietnamese credit institutions operating in country;

+ Joint-venture credit institutions, non-bank credit institutions with 100% foreign capital, foreign banks’ branches operating and doing business in Vietnam’s territory with time of 12 months or more;

"Foreign Credit institutions/banks” mean credit institutions of non-residents including:

+ Foreign credit institutions that operate outside of Vietnam’s territory;

+ Vietnamese credit institutions that operate outside of Vietnam’s territory with time of 12 months or more.

8. The accounting entries on foreign accounts prescribed in this system of book-keeping accounts must be performed in the following principle:

8.1- To implement reciprocal accounting and balancing among foreign currency accounts and each type of account.

8.2- For operations of foreign currency purchase or sale, accounting currently reciprocal entries in foreign currency and reciprocal entries in Vietnamdong.

8.3- For revenues, interest payments in foreign currency that are performed through operations of foreign currency purchase and sale in order to convert into Vietnam dong according to the exchange rates at the arising time in order to account in income and expense.

8.4. The value of foreign currency converted into Vietnam dong for accounting operations of foreign currency purchase and sale on accounts with foreign currency origin shall be calculated according to the actual trading exchange rates at time arising operation. For other foreign currency operations, uniformly accounting entries according to the exchange rates announced by the State bank of Vietnam at time arising operations.

8.5- On the detailed accounting books of foreign currency acounts, writing both foreign currency and Vietnam dong.

8.6- The general accounting of foreign accounts just reflects in Vietnam dong.

8.7- At the end of month, to convert (for making reports) balance of all accounts of currency index with foreign currency origin according to the exchange rates between Vietnam dong and USD announced on the end of month by the State bank (SBV), except non-currency indexes (fixed assets, materials, capital contribution for investment, share purchase in foreign currency, so on) still be accounted according to the exchange rates at day of transaction (these accounts are not re-assessed). The decreasing or increasing differences of balances at the end of month (converted into Vietnam dong) of accounts with foreign currency origin shall be accounted additionally in month revenue of foreign currency accounts and transferred into account 631 “Difference of exchange rates”

8.8- For credit institutions having many foreign currency operations, to simplify daily accounting, they may organize detailed and general accounting for foreign currency accounts according to original currency, but at the end of month, they must convert the balance, revenues of operations in the month related to foreign currency accounts into Vietnam dong (according to the exchange rates between Vietnam dong and USD that are announced by SBV at the end of month) for fully summarizing and reflecting operations on the monthly accounting balance sheet in Vietnam dong.

8.9- For foreign currencies that have no exchange rates with Vietnam dong, they must be converted through a foreign currency that has exchange rate with Vietnam dong.

8.10- For credit institutions with many operations in gold and able to apply informatic technology, they may account in details for monitoring gold in kinds (according to unit of “chi” gold 99.99%) and value. When generally accouting, they must convert value of artifacts into Vietnam dong (to re-assess value of gold) according to the actual buying gold price at time of making report. And for operations of gold purchase or sale, they may use with two accounts 4711 and 4712 for accounting similar to accounting of foreign currency purchase or sale (gold is considered as a foreign currency).

(The remaining parts of Annex are not translated into English herein)