Chương 2 Nghị định 59/2011/NĐ-CP chuyển doanh nghiệp 100% vốn nhà nước: Xử lý tài chính khi cổ phần hóa

Chapter II

FINANCIAL SETTLEMENT DURING EQUITIZATION

Article 13. Inventory and classification of assets and settlement of financial problems

1. After receiving a competent agency’s equitization decision, an enterprise shall inventory and classify assets, capital sources and funds it is currently managing and using at the time of enterprise valuation.

2. An equitized enterprise shall get its annual financial statements audited under state regulations. If the time of valuation does not coincide with the ending time of a fiscal year, the equitized enterprise shall make a financial statement up to the time of valuation.

3. Before conducting the enterprise valuation and the handover settlement at the time it is granted the first-time enterprise registration certificate for operating under the Law on Enterprises, an equitized enterprise shall request in writing the tax office directly managing it to examine and settle its amounts remittable into the state budget. Within 30 working days after receiving the written request of the enterprise, the tax office shall promptly conduct the examination and settlement. Past this time limit, if the tax office fails to conduct the examination and settlement, the equitized enterprise shall base itself on the declared data to conduct the handover settlement and enterprise valuation under regulations. After the enterprise is officially transformed into a joint-stock company, any losses arising due to the failure to conduct tax examination and settlement shall be handled under Clause 3, Article 52 of this Decree.

4. Based on results of inventory of assets, audit of annual financial statements and settlement of amounts remittable into the state budget, an equitized enterprise shall coordinate with related agencies in proactively settling according to their competence and law outstanding financial problems before its valuation.

If the settlement meets with difficulties or falls beyond its competence, the equitized enterprise shall promptly report such to competent agencies for consideration and settlement.

If the reported problems cannot be still settled, they must be clearly stated in the minutes of valuation of the equitized enterprise to serve as a ground for continued settlement during the period from the time of enterprise valuation to the time of official transformation into a joint-stock company.

Article 14. Handling of assets which are leased, borrowed, accepted as capital contributed to joint-venture or business association, assets which are no longer needed for use and assets formed with investments from reward and welfare funds

1. Assets which an equitized enterprise has leased, borrowed, accepted as capital contributed to joint-venture or business association and other assets not belonging to the enterprise shall not be included in the enterprise value for equitization. Before its transformation into a joint-stock company, the enterprise shall reach agreement with the owners of these assets so that the joint-stock company can take over or liquidate signed contracts.

2. Assets which are no long needed nor used by an equitized enterprise or await liquidation shall be disposed of (liquidated or sold) by the enterprise under current financial management regulations. Assets which have not yet been disposed of by the enterprise by the time of enterprise valuation, except those specified in Clause 3 of this Article, shall be considered and decided by the agency competent to decide on disclosure of the enterprise value to be excluded from the enterprise value and then handed over to the following agencies:

a/ The Vietnam Debt Trading Company for handling under law, for the enterprises specified in Article 2 of this Decree.

b/ Parent companies of state economic groups or state corporations, parent companies in parent company - affiliated company conglomerates for handling under regulations, for limited liability companies in which these enterprises hold 100% of charter capital.

3. Assets disallowed to be excluded from the enterprise value include:

a/ For houses, buildings and other architectures (including also underground works, internal roads, fencing walls, internal yards and grounds) which enterprises directly or indirectly use; machinery, equipment and vehicles newly invested and put into use within last five years or having a book residual value equal to 50% or more of their historical costs, enterprises shall further manage, monitor and definitely handle them under current financial management regulations up to the time of official transformation into joint-stock companies.

b/ For assets subject to destruction, including chemicals, hazardous substances, expired pesticides, etc., enterprises shall coordinate with functional agencies in destroying them under current financial management and environmental management regulations before conducting the first-time enterprise registration for operating under the Law on Enterprises. After identifying causes of and responsibilities for violations and paying compensations under current financial management regulations, losses may be offset by enterprises against their business results under regulations.

c/ For assets being uncompleted capital construction expenses of works delayed under decisions of competent authorities, equitized enterprises shall further take over, monitor and handle them under law. Particularly for project expenses rejected by competent authorities, not yet turned into tangible objects and irrecoverable, such as those for elaboration of pre- feasible plans, work survey and designing, enterprises shall identify causes and responsibilities for paying compensations under current financial management regulations, and offset losses against their business results under regulations.

4. Welfare facilities, including nurseries, kindergartens, infirmaries and other welfare assets invested with reward and welfare funds, shall be transferred to trade union organizations of joint-stock companies for management to serve employees of these joint-stock companies.

Houses of cadres, employees and workers built with enterprises’ welfare funds, including those built with state budget funds, shall be transferred to local housing and land administrations for management.

5. Assets formed with investments from reward and welfare funds of the equitized enterprise and used in its production and business activities shall be included in the enterprise value and further used by the joint-stock company in its production and business. A capital amount equivalent to the value of these assets shall be returned by the equitized enterprise to the reward and welfare funds for division to the enterprise’s employees working by the time of enterprise valuation according to the number of their working years in the enterprise.

6. For state-owned commercial banks, the inventory, valuation and classification of assets being capital in cash, assets used for financial leasing and debts (receivable and payable) must comply with specific guidance of the Ministry of Finance.

Article 15. Receivable debts

1. Equitized enterprises shall check and certify all their receivable debts (both due and undue), and concurrently recover debts which become due before the time of their valuation. By the time of enterprise valuation, any outstanding receivable debts shall be handled under the State’s current regulations on handling of outstanding debts. Receivable debts without sufficient legal dossiers evidencing that they are still owed by debtors or irrecoverable under regulations must not be excluded from the enterprise value, and enterprises shall identify their causes and handle them on the following principles:

a/ Identifying the compensation responsibility of collectives or individuals related to receivable debts owed by unidentified debtors, and handling remaining losses under the State’s current regulations on handling of outstanding debts.

b/ Completing dossiers and further monitoring for recovery debts which cannot be proven to be irrecoverable.

2. Equitized enterprises shall hand over debts which have not been accounted into their value (including also bad debts already handled with the reserve source within 5 years preceding the equitization) together with sufficient relevant dossiers and documents to the agencies specified in Clause 2, Article 14 of this Decree.

3. Amounts already prepaid to goods or service providers, such as house rents, land rents, goods purchase money amounts and remunerations, shall be verified against relevant contracts and volumes of provided goods or services before being included in the value of equitized enterprises.

Article 16. Payable debts

1. Debts payable to organizations and individuals:

Equitized enterprises shall check and certify all their receivable debts (both due and undue) before the time of their valuation. They shall mobilize lawful capital sources for paying debts which become due before the time of their valuation or reach written agreement with creditors on handling or converting them into contributed shares.

Payable debts due at the time of enterprise valuation shall be converted into contributed shares based on creditors’ successful auction bids or must not be lower than the lowest successful auction bid of a public auction (in case of sale under agreement). In case shares are sold to strategic investors before the public auction, debts shall be converted into contributed shares as agreed at a price which must not be lower than the reserve price approved by the agency competent to approve equitization plans.

2. Outstanding tax amounts and state budget remittances: Equitized enterprises shall pay taxes and amounts owed to the state budget before transformation. If an equitized enterprise has not yet fulfilled its tax payment obligation, the joint-stock company shall take over the whole of this obligation.

3. In the course of equitization, if an equitized loss-making enterprise meets difficulties in paying overdue loans borrowed from credit institutions (including also the Vietnam Development Bank), these debts shall be handled under the State’s current regulations on handling of outstanding debts.

Article 17. Reserves, losses or profits

1. Reserves for inventory price decreases, losses from financial investments, bad receivable debts, warranties for products, goods and construction or installation works; and exchange rate differences shall be used to offset losses under current regulations; any remaining amounts shall be included into the value of state capital portions in equitized enterprises.

2. Banking risk reserve funds and professional insurance operation reserve funds, after being used to offset losses under regulations, shall be left to equitized enterprises and accounted into the value of state capital portions in equitized enterprises.

3. The financial reserve fund shall be used to pay losses (if any) and offset asset losses and irrecoverable debts remaining after being compensated (if any) by responsible individuals. Any remaining amount shall be included into the value of state capital portions in equitized enterprises.

4. Profits shall be used to offset previous years’ losses (if any) under the Law on Enterprise Income Tax, losses in assets no longer needed for use or awaiting liquidation, asset price decreases and irrecoverable debts. Any remaining amount shall be allocated under current regulations before the enterprise valuation.

5. After losses are handled under the above provisions, if there are still some unpaid debts owed to credit institutions (including also the Vietnam Development Bank) by the time of enterprise valuation, equitized enterprises shall coordinate with related agencies in writing off outstanding loan interests under the State’s current regulations on handling of outstanding debts.

Article 18. Long-term investments in other enterprises, such as capital contributed to joint ventures or business association, contributed as shares, contributed for the establishment of limited liability companies, and other forms of long-term investment

1. When an equitized enterprise takes over long-term investment capital already invested in another enterprise, this capital amount shall be wholly included in the enterprise value for equitization on the principles set out in Article 33 of this Decree.

2. When an equitized enterprise does not take over long-term investments in other enterprises, it shall report them to the agency competent to decide on the equitization plan for handling as follows:

a/ Reaching agreement with capital contributors on transfer of its capital contribution to another wholly state-owned enterprise to act as a new partner.

b/ Selling its capital contribution to its partner(s) or other investors under law.

c/ Taking over long-term investments as part of its value under Clause 1 of this Article if, by the time of disclosure of its value, it is still unable to sell or transfer these investments to other partners.

d/ In case the value of capital invested in other enterprises is large and might cause a difficulty to the equitization if it is included in the enterprise value, the agency competent to decide on the equitization plan shall identify the causes and propose remedies to the Prime Minister for consideration and decision.

Article 19. Cash balances of reward and welfare funds

Cash balances of reward and welfare funds, after being used to pay amounts in excess of prescribed levels to employees, shall be divided to employees currently working in equitized enterprises at the time of enterprise valuation based on the number of years they have worked in these enterprises.

Article 20. Balance of the enterprise reorganization support fund in enterprises

The balance (if any) of the enterprise reorganization support fund in an equitized enterprise shall be accounted as state capital increase in the enterprise.

Article 21. Financial settlement at the time of official transformation of enterprises into joint-stock companies

1. Based on its value already decided by a competent agency, an equitized enterprise shall adjust its accounting book figures accordingly; preserve and hand over liabilities and assets excluded upon its valuation under Clause 2, Article 14, and Clause 2, Article 15 of this Decree; further settle financial problems in the period from the time of enterprise valuation to the time of official transformation into a joint-stock company, and make a financial statement at the time of official transformation.

At the time when the equitized enterprise is granted the first-time enterprise registration certificate, upon making a financial statement for handover from the enterprise with 100% state capital to the joint-stock company, the enterprise shall revaluate its securities investments (if any) already included in its value. The total value of securities investments, which might be higher or lower than that currently accounted in accounting books, may be accounted by the enterprise into its business results under law.

2. Within 30 working days after obtaining its first-time enterprise registration certificate, an equitized enterprise shall complete a financial statement at the time of enterprise registration, have this financial statement audited, request the tax office to examine its tax settlement, conduct the settlement to determine the value of the state capital portion at the time of official transformation into a joint-stock company and identify financial problems to be further settled.

3. The positive difference between the actual value of the state capital portion in an enterprise at the time of its officially transformation into a joint-stock company and the actual value of the state capital portion at the time of its valuation shall be handled as follows:

a/ It shall be remitted into the enterprise reorganization support fund at the parent company of the state economic group or corporation or the parent company in the parent company - affiliated company conglomerate, in case of equitization of single-member limited liability companies in which such parent company holds 100% of charter capital.

b/ It shall be remitted into the enterprise reorganization and development support fund, in case of equitization of the whole of single-member limited liability companies in which the State holds 100% of charter capital and which are enterprises of ministries, ministerial-level agencies, government- attached agencies or provincial-level People’s Committees; or of parent companies of state economic groups or corporations.

4. In case of a negative difference, the equitized enterprise shall report it to the agency competent to decide on the equitization plan for coordinating with related agencies in examining and identifying the cause and the responsibilities of related collectives and individuals, and handle it as follows:

a/ If it is due to an objective cause (natural disaster, enemy sabotage; state policy change, international market fluctuation or other force majeure circumstances), the equitized enterprise shall report it to the agency competent to decide on the equitization plan for consideration and decision on the use of the proceeds from the sale of shares to offset losses, after subtracting insurance indemnities (if any). If the proceeds from the sale of shares are not enough to offset losses, the agency competent to decide on the equitization plan shall consider and propose the Shareholders’ General Meeting to adjust the size and structure of the charter capital of the joint- stock company.

b/ If it is due to a subjective cause:

- If losses are caused by the incomplete settlement of financial problems under the State’s current regulations, the responsibilities of related agencies and individuals: the enterprise, consultancy organization, audit agency and agency competent to decide on the equitization plan, shall be clearly determined for material compensation payment;

- If capital and asset losses are caused by production and business administration and management, the enterprise’s managers shall pay compensations for all losses caused by their subjective faults under current regulations;

- If, for force majeure reasons, responsible persons are unable to pay compensations under competent agencies’ decisions, any remaining losses shall be handled as those attributable to an objective cause under Point a of this Clause.