Distribution of Profits for State-Owned Enterprises

1. In the event that during the fiscal year an enterprise incurs both a loss in production and business operations that is carried over to the following year (negative taxable income), as well as a profit due to non-taxable corporate income or accumulated loss from the previous year that is offset against the taxable income of the subsequent year according to the Corporate Income Tax Law, the enterprise may only use the remaining profit difference in the fiscal year after deducting the aforementioned loss for distribution and allocation to funds as prescribed.

2. The basis for setting up the reward fund, welfare fund, management bonus fund, and supervisory board bonus fund is determined as follows:

- For categorizing enterprises as A, B, C as the basis for setting up funds, it is carried out according to the regulations of the Government of Vietnam on monitoring state capital investment in enterprises; financial supervision, performance evaluation, and financial information disclosure of state-owned enterprises and enterprises with state capital, and guidelines in the Circular of the Ministry of Finance.- Regarding the monthly salary used as a basis for setting up the funds:- For setting up the reward fund and welfare fund of state-owned enterprises: based on the wage fund executed in the fiscal year for the employees of the enterprise, divided (:) by 12 months.- For setting up the management bonus fund and supervisory board bonus fund: based on the wage fund and remuneration executed for managing (specialized and non-specialized) public employees, divided (:) by 12 months.

Details can be found in Circular 219/2015/TT-BTC, effective from February 15, 2016.

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