Completing the State Financial Report

State Treasury actively work with relevant units in collecting and making State Financial Report in 2020. Photo: Thùy Linh

Reflecting basic information

Currently, the State Financial Report 2020 is being submitted to the National Assembly Standing Committee together with the State Budget Finalization Report at the meeting session in May 2022 in accordance with the provisions of the Law on Accounting 2015.

According to the assessment, the State Financial Report 2020 reflected some information on the situation of assets, sources of asset formation, income, expenses and movement of cash flow from the state sector.

This information is collected and presented in the State Financial Report following basis accounting, appropriate with the standards of public accounting of Vietnam as well as international practices of countries around the world.

In particular, regarding the scope of state assets, the 2020 State Financial Report reflected information on the value of state assets which are currently monitored and managed at agencies and units of the state sector, most of the assets of off-budget state financial funds and State capital invested in enterprises.

For some specific types of units, by the fiscal year 2020, the units applied a new accounting regime which is revised and supplemented to ensure consistency with accounting principles as prescribed in the Law on Accounting 2015, the public sector accounting promulgated in the Circular 107/2018/TT-BTC of the Ministry of Finance on guidelines for public sector accounting.

Accordingly, the state asset value allocated to these units has been fully summarized in the State Financial Report.

In addition, the state financial report also reflected a part of the value of infrastructure assets, including road transport infrastructure managed by the central and local authorities and concentrated rural clean waterworks (it has been reviewed, controlled, standardized and updated with district-level data in some localities in 2020).

The State Treasury has issued and coordinated with relevant units to submit to the competent authorities for promulgation specific guidelines on the general implementation and preparation of the State Financial Report in 2020 for local State Treasury; urging ministries, sectors and localities to review and standardize data on road infrastructure assets and clean water for rural areas on the national database of public assets in order to have a basis to update the state financial report 2020; guiding the synthesis of financial information of specific units to apply the new accounting regime from the fiscal year 2020.

Continue to improve legal regulations

Although the quality of the state financial report is gradually improving, it still has shortcomings, especially incomplete information. The State Financial Report 2020 does not include transport infrastructure assets (aviation, maritime, national railways, inland waterways and irrigation infrastructure); the report also does not reflect the value of infrastructural assets which do not have mechanisms or policies to regulate the management, use and exploitation regimes such as dikes, urban infrastructure, etc.

To overcome the shortcomings and limitations of the state financial report, improve the quality of the state financial report in the following years, the Ministry of Finance has implemented many solutions such as promulgating and perfecting legal regulations on accounting (developing and promulgating Vietnam's public accounting standards, promulgating a Circular guiding the provision of information on infrastructure assets, especially heritage and antiquities), urging specialized management ministries to review and finalize policies on management, use and exploitation of infrastructural assets under state management, and review, classify and identify the value of existing infrastructure assets for allocation, management, use and exploitation.

In addition, the State Treasury is also urgently studying, developing and submitting to the Ministry of Finance a roadmap to complete the preparation of the State Financial Report for consultation with ministries, sectors and localities; which focuses on assessing the current status of the state financial report and proposing solutions to develop and improve mechanisms and policies, especially mechanisms and policies on public asset management (clearly specifying the responsibilities of ministries, sectors, localities; supplementing sanctions for handling), implementation (the participation and close coordination of ministries, sectors and localities) in order to gradually synthesize state infrastructure assets, natural resources; improve the quality of financial information of agencies and units in the state sector to ensure compliance with international standards and practices.

This is relatively complicated, involving many sectors and localities; at the same time, there are many problems and inadequacies in implementation, so it is very important for the attention, support and close coordination of all levels, sectors and localities for the Ministry of Finance to study and develop this roadmap, ensuring feasibility during implementation.