This account is used to record payables and payment of payables to employees of enterprises, including salaries, wages, bonuses, social insurance and other payables included in employees‘ incomes.

This account is used to record relation between enterprises and State about taxes, fees, charges and other payables, payment and outstanding payables to State budget in the fiscal year.

This account is used to record payment of liabilities of an enterprise to the sellers of materials, goods or suppliers of services, sellers of fixed assets, investment properties or financial investment under concluded business contracts.

Liabilities of an enterprise must be kept records in details according to payment schedule, creditor, type of currency and other factors according to requirements of the enterprise.

This account is used to record a sum of money or something valuable that the enterprise uses for pledge, mortgage or deposit purpose in other enterprises or organizations in economic relation as prescribed.

This account is used to record current value, and increases or decreases of deferred tax assets.

Chi phí trả trước về thuê cơ sở hạ tầng, thuê hoạt động TSCĐ (quyền sử dụng đất, nhà xưởng, kho bãi, văn phòng làm việc, cửa hàng và TSCĐ khác) phục vụ cho sản xuất, kinh doanh nhiều kỳ kế toán.

 Account 241 – Construction in progress

1. Rules for accounting

a) This account is only used in a non-project management board unit to record expenses of capital investment projects (including new acquisition of fixed assets, new construction, repairs, improvement, extension or refurbishment of construction), and settlement condition of capital investment projects in those enterprises having fixed assets acquisitions, capital investment, or major repairs of fixed assets.

Capital investment and major repairs of fixed assets of the enterprise may be carried out under contract awarding method and or self-constructed method. If the enterprise carries out capital investment under self-constructed method, this account must also record expenses incurred during construction or repair process.

Those units establishing project management board and accounting structure shall comply with regulations in the Circular No. 195/2012/TT-BTC on guidelines for Accounting standards for investors.

b) Expenses of capital investment projects are total necessary expenses of new construction, repairs, improvement, extension or technical refurbishment of construction. Expenses of capital investment are determined according to work volume, economic and technical indicators or quotas and state policies, and in conformity with objective factors of the market in every period and carried out with regulations in capital investment management. Capital investment expenses include:

- Construction expenses;

- Equipment expenses.

- Compensation, support and resettlement expenses;

- General administration expenses;

- Construction consultancy expenses;

- Other expenses.

The account 241 is kept recorded in details for each building work, work item. Each work item must be specifically recorded every capital investment expenses and is observed on accrual basis from the commencement date until the date on which the building works or work items are finished and put into operation.

c) In capital investment, construction and equipment expenses are usually charged directly to every building work, general administration expenses and other expenses are usually common expenses. Investors must calculate and allocate general administration expenses and other expenses incurred from every building work according to following rules:

- General administration expenses and other expenses related directly to each building work shall be charged directly to that building work.

- General administration expenses and other common expenses generally related to many building works but not charged directly to every building work shall be allocated to every building work which is most appropriate.

d) In case the project is finished and put into operation, but project settlement report is not approved, the enterprise shall record an increase in fixed assets historical cost at provisional price (provisional price will be based on actual expenses disbursed to acquire the fixed assets) for depreciation, but then the provisional price shall be adjusted by the approved settlement price.

dd) Repair or maintenance expenses incurred from the fixed assets shall be directly recorded to operating costs within a period. If the repair or maintenance expenses incur periodically, an allowance payable may be created then the allowance shall be included in operating costs.

e) The investor of property construction shall use this account to record fixed asset construction expenses and investment property construction expenses. In case the property is used for multiple purposes (office, lease or sale, i.e. mixed-used building), the construction-directly attributable expenses still be recorded to the account 241. When the building work is completed and put into operation, the construction expenses shall be transferred in conformity with the nature of every asset according to method of use of asset.

g) Exchange rate differences arising from capital investment progress shall following rules below:

Exchange rate differences before operation:

+ Regarding wholly-state-owned enterprises performing tasks of security, national defense or macroeconomic stability, exchange rate differences arising before the operation shall be accumulatively recorded to the account 413 – Exchange rate differences. When the building work is put into operation, the exchange rate differences shall be gradually allocated from account 413 to account 515 – Financial income (in case of profits) or account 635 – Financial expenses (in case of losses). If the allocation may not expire the regulated duration, if the exchange rate loss is recorded to Dr 413, the income statement shall state zero profit (the enterprise may not both record exchange rate loss to the item – Exchange differences in the balance sheet and record post-tax profit in the income statement).

+ Regarding other enterprises, the exchange rate differences before the operation shall be recorded to financial income (in case of profits) or financial expenses (in case of losses), but not stated in the exchange rate difference on the account 413.

- Regarding exchange rate differences relating to capital investment when the enterprise put into operation (including new investment and extension investment):

All types of enterprises, including wholly-state-owned enterprises performing tasks of security, national defense or macroeconomic stability, exchange rate differences arising from capital investment (including new investment or extension investment) shall be recorded to financial income (in case of profits) or financial expenses (in case of losses), not recorded to exchange rate differences on the account 413.

h) If the project of investment is cancelled, the enterprise must dispose and recover the expenses incurred from the project. The difference between actual investment expenses and amounts collected from disposal shall be recorded to other expenses or the compensation of the organization or individual.

Account 241 – Construction in progress, comprise 3 sub-accounts:

- Account 2411: Fixed assets acquisition: records expenses of fixed assets acquisition and settlement of fixed assets expenses in case fixed assets must be assembled and operated for testing before put into use (including both new fixed assets acquisition or used fixed assets). If acquired fixed assets need additional investment or furnishment before being use, then total expenses of additional investment or furnishment must be recorded to this account.

- Account 2412: Capital construction: records capital investment expenses and settlement of capital expenditure. This account is kept records in details for each building work or work item (for each asset acquired though investment) and every capital investment expense incurred in each asset must be kept records in details.

- Account 2413: Major repairs of fixed assets: records major repairs expenses of fixed assets and settlement of major repairs expenses of fixed assets. The expenses incurred in regular repairs of fixed assets shall not be recorded to this account, but be charged directly to operating costs within a period.

2. Structure and contents of account 241 – Construction in progress

Debit:

- Expenses incurred from capital construction, purchase or major repairs of fixed assets (tangible fixed assets and intangible fixed assets);

- Expenses incurred from renovation or upgrading of fixed assets;

- Expenses incurred from sale of investment properties (in case construction investment stage is necessary);

- Expenses incurred from capital investment properties:

- Expenses incurred after initial recording of fixed assets or investment properties.

Credit:

- Value of fixed assets acquired from capital construction investment or sale which is put into operation.

- Value of rejected works and other expenses which were approved to be rejected and transferred when settlement report is approved.

- Value of major repairs of fixed assets which is completed and transferred when the settlement report is approved.

- Value of investment property acquired from capital construction which is finished.

- Transferring expenses incurred after initial recording of fixed assets or investment properties to related accounts.

Debit balance:

- Expenses incurred from construction investment project and major repairs of fixed assets in progress.

- Value of construction and major repairs of fixed assets which are finished, but have not been yet put into operation or settlement report is not yet approved.

- Value of construction of investment property in progress.

3. Method of accounting for several major transactions

3.1. Accounting for capital investment expenses

3.1.1. Advances paid to contractors

a) Advances in VND:

- When paying an advance in VND to a contractor, the following accounts shall be recorded:

Dr 331 – Trade payables

Cr 112 – Cash in bank (1122) (weighted average book rates).

- When accepting completed the capital investment, the construction in progress expenses for advance amounts shall be recorded as follows:

Dr 241 – Construction in progress

Cr 331 – Trade payables.

b) Advances paid in foreign currencies:

- When paying an advance in foreign currency to a contractor according to the actual exchange rate at the payment time, the following accounts shall be recorded:

Dr 331 – Trade payables (actual exchange rates)

Dr 635 – Financial expenses (if losses of exchange rates incur)

Cr 112 – Cash in bank (1122) (weighted average book rates).

Cr 515 – Financial expenses (if profits of exchange rates incur)

- When accepting completed the capital investment, the construction in progress expenses for advance amounts in foreign currency shall be recorded as follows according to the book exchange rates (actual exchange rates at the payment time):

Dr 241 – Construction in progress

Cr 331 – Trade payables.

3.1.2 When receiving the completed capital investment or repaired fixed assets from the contractor, if the input VAT is deductible, the following accounts shall be recorded according to awarding contract, acceptance report or sale invoice:

Dr 241 – Construction in progress (2412, 2413)

Dr 133 – Deductible VAT (1332) (if any)

Cr 331 – Trade payables.

- If the input VAT is not deductible, the value of capital investment expenses in progress shall include VAT.

- If the awarding contract regulates that the contract is paid in foreign currencies, the amounts payable (after deducting from advance amounts) shall be recorded according to the actual exchange rates at the accepting time (selling exchange rates of the commercial bank where the enterprise regularly enters into transactions).

3.1.3. When buying capital investment equipment, if the input VAT is deductible, the following accounts shall be recorded according to invoices or warehouse receipt:

Dr 152 – Raw materials (VAT-exclusive prices)

Dr 133 – Deductible VAT (1332)

Cr 331 – Trade payables (total payment)

When transferring directly non-assembly equipments to working site for the contractor, the following accounts shall be recorded:

Dr 241 – Construction in progress

Dr 133 – Deductible VAT (1332)

Cr 331 – Trade payables.

Cr 151 – Goods in transit

3.1.4. When paying to the contractor, or material, good or service suppliers related to capital construction, the following accounts shall be recorded:

Dr 331 – Trade payables

Cr 111, 112, etc.

3.1.5. Delivering capital investment equipment to the contractor:

a) For non-assembly equipment, the following accounts shall be recorded:

Dr 241 – Construction in progress

Cr 152 – Raw materials.

b) For assembly equipment:

- When delivering capital investment equipment to the contractor, only the assembly equipment is kept records in details.

- When receiving finished assembly volume transferred by party B, which is accepted for payment, then value of equipment delivered for new assembly will be charged to capital investment expenses and the following accounts shall be recorded:

Dr 241 – Construction in progress (2412)

Cr 152 – Raw materials.

3.1.6. When incurring other expenses, such as interest expenses, expenses incurred from capitalized bond issuance, tender expenses, (after offsetting against amounts of money collected from sale of tender dossiers), expenses incurred from dismantling for premises returning (after offsetting against recoverable wastes), etc, the following accounts shall be recorded:

Dr 241 – Construction in progress (2412)

Dr 133 – Deductible VAT (1332) (if any)

Cr 111, 112, 331, 335, 3411, 343, etc.

The remaining amounts of money collected from sale of tender dossiers (after offsetting against tender expenses) shall be recorded to a decrease in construction expenses (recorded to Cr 241).

3.1.7. When the contractor collects fines leading a decrease in amounts payable to the contractor, the following accounts shall be recorded:

Dr 112, 331

Cr 241 – Construction in progress

3.1.8. Any exchange rate difference incurring from capital investment (including before-operation stage) shall be recorded financial income (in case of profits) or financial expenses (in case of losses) at the incurring time (other than enterprises prescribed in Point 3.1.9 below):

- When incurring exchange rate profits, the following accounts shall be recorded:

Dr, relevant accounts

Cr 515 – Financial income

- When incurring exchange rate losses, the following accounts shall be recorded:

Dr 635 – Financial expenses

Cr, relevant accounts

3.1.9. Regarding wholly-state-owned enterprises performing tasks of security, national defense or macroeconomic stability, if exchange rate differences arise before the operation (not engaged in the operation):

- When incurring exchange rate profits, the following accounts shall be recorded:

Dr, relevant accounts

Cr 413 – Exchange rate differences

- When incurring exchange rate losses, the following accounts shall be recorded:

Dr 413 – Exchange rate differences

Cr, relevant accounts

- When the building work is put into operation, the exchange rate differences shall be transferred to financial income or financial expenses, and the following accounts shall be recorded:

+ When transferring exchange rate profits, the following accounts shall be recorded:

Dr 413 – Exchange rate differences

Cr 515 – Financial income

+ When transferring exchange rate losses, the following accounts shall be recorded:

Dr 635 – Financial expenses

Cr 413 – Exchange rate differences

3.1.10. With regard to testing expenses and amounts of money collected from sale of experimental products:

a) Regarding testing expenses without production of experimental products, the following accounts shall be recorded:

Dr 241 – Construction in progress

Cr, relevant accounts

b) With regard to testing expenses and amounts of money collected from sale of experimental products:

- When incurring testing expenses with production of experimental products, total expenses shall be recorded as follows:

Dr 154 – Work in progress

Cr, relevant accounts

- When delivering experimental products to inventory, the following accounts shall be recorded:

Dr 1551 – Finished goods inventory

Cr 154 – Work in progress.

- When selling experimental products, the following accounts shall be recorded:

Dr 112, 131

Cr 1551 – Finished goods inventory

Cr 154 – Work in progress (sale without inventory)

Cr 3331 – VAT payable (if any)

- The differences between testing expenses and amounts of money collected from sale of experimental products shall be transferred as follows:

+ In case the testing expenses are greater than the amounts of money collected from sale of experimental products, the positive difference between them shall be recorded to an increase in construction in progress; the following accounts shall be recorded:

Dr 241 – Construction in progress

Cr 154 – Work in progress.

+ In case the testing expenses are smaller than the amounts of money collected from sale of experimental products, the negative difference between them shall be recorded to a decrease in construction in progress; the following accounts shall be recorded:

Dr 154 – Work in progress.

Cr 241 – Construction in progress

3.1.11. When the building work is completed and totally accepted and put into operation: If the financial report is approved instantly, the accounting records shall be kept according to the value of assets acquired through investments. If the financial report is not approved, an increase in value of the assets acquired through investment shall be recorded according to provisional prices (provisional prices are actual expenses paid to acquire the assets according to account 241). The following accounts shall be recorded in above both cases:

Dr 211, 213, 217

Dr 1557 - Finished goods – property (a part of property shall be used for sale which is not recorded to account 154)

Cr 241 – Construction in progress (approved prices or provisional prices)

In case the building work is finished, but it is not transferred for use, awaiting preparation or approval for report, it shall be kept records to account 241 ―Construction in progress‖ in details.

3.1.12. When the financial report on capital investment is approved, the provisional prices shall be adjusted according to the approved value of assets:

- If the approved value of asset acquired though capital investment is smaller than the provisional price, the following accounts shall be recorded:

Dr 138 – Other receivables (rejected expenses subject to recovery)

Cr 211, 213, 217, 1557.

- If the approved value of asset acquired though capital investment is greater than the provisional price, the following accounts shall be recorded:

Dr 211, 213, 217, 1557

Cr, relevant accounts

- If the fixed asset invested by capital expenditure funds and the competent agency permit to increase operating capital and the following accounts shall be recorded:

Dr 441 – Capital expenditure funds

Cr 241 – Construction in progress (damages approved to be rejected)

Cr 411 – Owner's invested equity (approved value of asset)

- If the fixed asset is acquired by welfare funds and used for welfare purpose, when the investor approves the settlement of investment capital, an increase in the welfare fund used for fixed asset acquisitions:

Dr 3632 – Welfare fund

Cr 3533 – Welfare fund used for fixed asset acquisitions.

3.1.13. If the enterprise is an investor having project management board to do accounting for capital investment:

a) Accounting for investor:

- When receiving the settled building work, the investor shall record the value of building work to settled value as follows:

Dr 211, 213, 217, 1557

Dr 133 – Deductible VAT (if any)

Dr 111, 112, 152, 153

Cr 136 – Intra-company receivables

Cr 331, 333, etc (receiving liabilities, if any).

- When receiving the non-settled building work, the investor shall record the value of building work to provisional value. When carry out the settlement, the value of building work shall be adjusted according to the approved price:

+ If the approved price is greater than the provisional price, the following accounts shall be recorded:

Dr 211, 213, 217, 1557

Cr, relevant accounts

+ If the approved price is smaller than the provisional price, the following accounts shall be recorded:

Dr, relevant accounts

Cr 211, 213, 217, 1557.

b) Accounting for project management board: comply with regulations of the Circular No. 195/2012/TT-BTC dated November 15, 2012 of the Ministry of Finance on guidelines for Accounting standards for investors and amended documents (if any).

3.1.14. If the project of investment is canceled or revoked, the liquidation of project and revocation of investment expenses shall be accounted. The difference between investment expenses and amounts of money collected from the liquidation shall be recorded to other expenses or covered by the compensation of organization or individual, and the following accounts shall be recorded:

Dr 111, 112, - Amounts of money collected from liquidation of project

Dr 138 – Other receivables (compensation paid by organization or individual)

Dr 811 – Other expenses (charged to expenses)

Cr 241 – Construction in progress

3.2. Accounting for repair of fixed assets

Repairs of fixed assets of the enterprise may be carried out under contract awarding method and or self-constructed method.

a) When repair expenses are incurred, they shall be recorded to Dr 241 ―Construction in progress‖ (2413) and be kept records in details for every building work or each fixed asset repair. According to documents on expenses:

- If the input VAT is deductible, the following accounts shall be recorded:

Dr 241 – Construction in progress (2413) (VAT-exclusive prices)

Dr 133 – Deductible VAT (1332)

Cr 111, 112, 152, 214, etc. (total payment).

- If the input VAT is not deductible, the expenses incurred from repairs of fixed assets shall include VAT and the following accounts shall be recorded:

Dr 241 – Construction in progress (2413) (total payment)

Cr 111, 112, 152, 214, 334, etc. (total payment).

b) When the repair is completed, if an increase in historical cost of fixed asset may not be recorded: Dr 623, 627, 641, 642

Dr 242 – Financial expenses (if the expenses are great, they shall be gradually allocated)

Dr 352 – Provisions (if the periodical repair expenses are prepaid)

Cr 241 – Construction in progress (2413).

- In case upgrading of fixed assets is eligible to record an increase in historical cost of fixed assets, the following accounts shall be recorded:

Dr 211 – Tangible fixed asset

Cr 241 – Construction in progress (2413).

Source: Circular 200

Account 229 – Allowances for impairment of assets

1. Rules for accounting

This account is used to record current value and increases or decreases in allowance for impairment of assets, including:

a) Allowance for decline in value of trading securities: means an allowance for impairment caused by decline in value of trading securities of an enterprise;

b) Allowance for impairment of investments in other entities: means an allowance for impairment because the contributee (subsidiaries, joint ventures or associates) suffers losses leading the irrecoverability of the investor or allowance due to decline in investments in subsidiaries, joint ventures or associates.

- With regard to investments in a joint venture or an associate, the investor only create allowance due to the losses of the joint venture or the associate if the financial statement is not applied the owner's equity method for investments in joint ventures or associates.

- With regard to long-term investments (other than trade securities) not influencing significantly on the investee, the allowances shall be carried out as follows:

+ If an investment in listed shares or the fair value of the investment is determined reliably, the allowance shall be made according to the market value of the shares (similarly to allowance for decline in value of trading securities);

+ With regard to an investment whose fair value is not identifiable at the reporting time, the allowance shall be made according to the loss of the investee (allowance for impairment of investments in other entities)

c) Allowance for doubtful debts: means an allowance for receivables and other held for maturity investments which are similar to doubtful debts.

d) Allowance for decline in inventories: means an allowance for decline in inventories due to increases in net realizable value against original value of inventories.

1.2. Method of accounting for allowance for decline in value of trading securities

a) The enterprise may create allowance for the probable impairment loss if it is evident that the market value of held for sale securities of the enterprise decline against the book value.

b) Requirements bases and allowance which is created or reverted shall comply with regulations of law.

c) The creating or reverting of allowance for decline in value of trading securities shall be carried out at the time in which the financial statement is prepared:

- If the allowance for current year is higher than the allowance in the accounting records, the enterprise shall create the additional difference of allowance and record it to financial expenses within a period.

- If the allowance for current year is lower than the unused allowance for previous year, the enterprise shall revert such difference and record a decrease in financial expenses.

1.3. Method of accounting for allowance for impairments in other entities

a) If the investee is a parent company, the investor shall create an allowance for impairments in other entities according to the consolidated financial statement of such parent company. If the investee is an independent company having no subsidiary, the investor shall create an allowance for impairments in other entities according to the consolidated financial statement of such investee.

b) The creating or reverting of allowance for impairments in other entities shall be carried out at the time in which the financial statement for every investment is prepared:

- If the allowance for current year is higher than the allowance in the accounting records, the enterprise shall create the additional difference of allowance and record it to financial expenses within a period.

- If the allowance for current year is lower than the unused allowance for previous year, the enterprise shall revert such difference and record a decrease in financial expenses.

1.4. Method of accounting for allowance for doubtful debts

a) When preparing financial statement, the enterprise shall determine doubtful debts and held to maturity investments whose nature is similar to doubtful debts to create or revert the allowance for doubtful debts.

b) The enterprise shall make an allowance for doubtful debts when:

- An overdue debt under an economic contract, a loan agreement, a contractual commitment or a promissory note has been demanded for several times, but it is unrecoverable. The time overdue of the doubtful debt requiring creation of the allowance shall be determined according to time in which the principal is repaid according to the sale contract, exclusive of the debt rescheduling between contracting parties;

- The debts are not due but the debtor is close to bankruptcy or undergone procedures for dissolution, or the debtor is missing or makes a getaway;

c) Requirements or bases for allowance for doubtful debts
- Original documents or promissory note of the debtor about the outstanding debts, including: economic contracts, loan agreements, liquidation of contract, promissory note, etc.

- The amounts of allowance for doubtful debts shall be created as prescribed in regulations in force.

- Other requirements as prescribed in regulations of law.

d) The establishing or reverting of allowance for doubtful debts shall be carried out at the time in which the financial statement is prepared:

- If the amount of allowance for doubtful debts at the end of current accounting period is greater than the allowance recorded in the accounting records, the positive difference shall be recorded to an increase in allowance and an increase in administrative expenses of the enterprise.

- If the amount of allowance for doubtful debts at the end of current accounting period is greater than the allowance recorded in the accounting records, the positive difference shall be recorded to an increase in allowance and an increase in administrative expenses of the enterprise.

e) With regard to doubtful debts for several years, if the enterprise fails to collect payment of debts regardless of all measures taken and they are bad debts, the enterprise shall sell that debts to Vietnam Asset Management Company (VAMC) or eliminate doubtful debts account on the accounting records. The elimination of doubtful debts account must be complied with regulations of law and the charter of the enterprise. These doubtful debts shall be monitored in the administration system of the enterprise and presented in the financial statement. After elimination, if the enterprise may collect payment of these doubtful debts, they shall be recorded to the account 711 "Other income".

1.5. Method of accounting for allowance for decline in inventories

a) The enterprise shall create an allowance for decline in inventories if it is evident that there is a decrease in net realizable value against the original cost of inventories. Allowance for decline in inventories means an estimated amount of decline in value of inventories against book value of inventories which is included in the operating cost in order to compensating actual damage caused by the decline.

b) The allowance for decline in inventories shall be created at the time in which the financial statement is prepared. The creation of allowance for decline in inventories must be complied in accordance with VAS ―Inventories‖ and financial regime in force.

c) The allowance for decline in inventories shall be created according to every inventoried material or good. With regard to services in progress, the allowance for decline in inventories shall be created according to every service having their own prices.

d) Net realizable value (NRV) means the estimated selling price in the ordinary course of business minus (-) any cost to complete and to sell the goods.

dd) When preparing financial statement, the creation of allowance for decline in inventories shall be determined according to quantity, original cost and NRV of every material, good or service in progress:

- If the amount of allowance for decline in inventories at the end of current accounting period is greater than the allowance for decline in inventories recorded in the accounting records, the positive difference shall be recorded to an increase in allowance and an increase in costs of goods sold.

- If the amount of allowance for decline in inventories at the end of current accounting period is smaller than the allowance for decline in inventories recorded in the accounting records, the negative difference shall be recorded to a decrease in allowance and a decrease in costs of goods sold.

2. Structure and contents of account 229 – Allowance for impairment of assets

Debit:

- Reverting negative difference between the allowance of this period and the unused allowance of previous period;

- Compensating for investments in other entities when the created allowance is compensated for the impairment loss.

- Compensating for the value of allowance for doubtful debts which is eliminated due to unrecoverability.

Credit:

Creating allowances for impairment of assets at the time in which the financial statement is prepared.

Credit balance: Ending allowance for impairment of assets.

Account 229 – Allowance for impairment of assets comprises 4 sub-accounts

Account 2291 – Allowance for decline in value of trading securities: this account is used to record creating or reverting of allowance for decline in value of trading securities.

Account 2292 – Allowance for impairments in other entities: this account is used to record creating or reverting of allowance for impairments suffered by an investor due the loss of the investee.

Account 2293 – Allowance for doubtful debts: This account is used to record creating or reverting of allowance for doubtful receivables and held to maturity investments.

Account 2294 – Allowance for decline in inventories: this account is used to record creating or reverting of allowance for decline in inventories.

3. Method of accounting for several major transactions

3.1. Method of accounting for allowance for decline in value of trading securities

a) When preparing a financial statement, if the allowance created in this period is greater than the allowance created in the previous period, the difference between them shall be additionally created according to the variation in market value of trading securities and the following accounts shall be recorded:

Dr 635 – Financial expenses

Cr 229 – Allowance for impairment of assets (2291).

b) When preparing a financial statement, if the allowance created in this period is smaller than the allowance created in the previous period, the difference between them shall be reverted according to the variation in market value of trading securities and the following accounts shall be recorded:

Dr 229 – Allowance for impairment of assets (2291).

Cr 635 – Financial expenses

c) Accounting for allowance for decline in value of trading securities of an wholly-state-owned enterprise before it is converted into a joint-stock company: The remaining allowance for decline in value of trading securities after compensating for the impairment loss shall be recorded to an increase in state capital as follows:

Dr 229 – Allowance for impairment of assets (2291).

Dr 635 – Financial expenses (amounts not covered by the allowance)

Cr 121 – Trading securities (amounts recorded to the decrease in the enterprise‘s value)

Cr 411 – Owner's invested equity (created allowance is greater than the impairment loss).

3.2. Method of accounting for allowance for impairments in other entities

a) When preparing a financial statement, if the allowance created in this period is smaller than the allowance created in the previous period, the difference between them shall be created and the following accounts shall be recorded:

Dr 635 – Financial expenses

Cr 229 – Allowance for impairment of assets (2292).

b) When preparing a financial statement, if the allowance created in this period is smaller than the allowance created in the previous period, the difference between them shall be reverted and the following accounts shall be recorded:

Dr 229 – Allowance for impairment of assets (2292).

Cr 635 – Financial expenses

c) When the impairment loss incurs, the investments are unrecoverable or recoverable with the cost which are lower than the original cost, if the enterprise use the allowance for decline in value of long-term investments to compensate for impairment losses of the long-term investment, the following accounts shall be recorded:

Dr 111, 112, etc. (if any)

Dr 229 – Allowance for impairment of assets (2292) (created allowance)

Dr 635 – Financial expenses (amount not covered by the allowance)

Cr 221, 222, 228 (the original cost of investments suffering losses)

d) The remaining allowance for decline in value of long-term investments after compensating for the impairment loss shall be recorded to an increase in state capital as follows when a wholly-state-owned enterprise is converted into a joint-stock company:

Dr 229 – Allowance for impairment of assets (2292).

Cr 411 – Owner's invested equity.

3.3. Method of accounting for allowance for doubtful debts

a) When preparing a financial statement, if the allowance for doubtful debts created in this period is greater than the unused allowance for doubtful debts created in the previous period, the difference between them shall be additionally created and the following accounts shall be recorded:

Dr 642 – General administration expenses

Cr 229 – Allowance for impairment of assets (2293).

b) When preparing a financial statement, if the allowance for doubtful debts created in this period is smaller than the unused allowance for doubtful debts created in the previous period, the difference between them shall be reverted and the following accounts shall be recorded:

Dr 229 – Allowance for impairment of assets (2293).

Cr 642 – General administration expenses.

c) With regard to doubtful debts which are considered bad debts, the elimination of debts shall be carried out in accordance with regulations of law in force According to the decision on elimination of debts; the following accounts shall be recorded:

Dr 111, 112, 331, 334, etc (organization or individual subject to compensation)

Dr 229 – Allowance for impairment of assets (2293) (created allowance)

Dr 642 – General administration expenses (amounts recorded to expenses)

Cr 131, 138, 128, 244, etc.

d) With regard to doubtful debts which are eliminated, if they are recovered, the following accounts shall be recorded according to the actual value of the recovered debts:

Dr 111, 112, etc.

Cr 711 – Other income.

dd) With regard to overdue debts sold at contractual prices, the following accounts shall be recorded:

- If there is not any allowance for overdue debts, the following accounts shall be recorded:

Dr 111, 112 (according to contractual prices)

Dr 642 – General administration expenses (impairment loss from sale of debts)

Cr 131, 138,128, 244, etc.

- If there is an allowance for overdue debts, but such allowance is not enough for compensating for impairment loss from sale of debts, the remaining loss shall be recorded to the general administration expenses as follows:

Dr 111, 112 (according to contractual prices)

Dr 229 – Allowance for impairment of assets (2293) (created allowance)

Dr 642 – General administration expenses (impairment loss from sale of debts)

Cr 131, 138,128, 244, etc.

e) Accounting for allowance for doubtful debts of a wholly-state-owned enterprise before it is converted into a joint-stock company: The remaining allowance for doubtful debts after compensating for the impairment loss shall be recorded to an increase in state capital as follows:

Dr 229 – Allowance for impairment of assets (2293).

Cr 411 – Owner's invested equity.

3.4. Method of accounting for allowance for decline in inventories

a) When preparing a financial statement, if the allowance for decline in inventories created in this period is greater than the allowance created in the previous period, the difference between them shall be additionally created and the following accounts shall be recorded:

Dr 632 – Costs of goods sold

Cr 229 – Allowance for impairment of assets (2294).

b) When preparing a financial statement, if the allowance for decline in inventories created in this period is smaller than the allowance created in the previous period, the difference between them shall be converted and the following accounts shall be recorded:

Dr 229 – Allowance for impairment of assets (2294).

Cr 632 – Costs of goods sold.

c) Accounting for allowance for decline in inventories regarding materials or goods which are destroyed after expiry date, degraded, deteriorates, or useless, the following accounts shall be recorded:

Dr 229 – Allowance for impairment of assets (2292) (compensation covered by the allowance)

Dr 229 – Costs of goods sold (if the impairment loss is greater than the allowance)

Cr 152, 153, 155, 156.

d) Accounting for allowance for decline in inventories before the wholly-state-owned enterprise is converted into a joint-stock company: The remaining allowance for decline in inventories after compensating for the impairment loss shall be recorded to an increase in state capital as follows:

Dr 229 – Allowance for impairment of assets (2294).

Cr 411 – Owner's invested equity.

Source: Circular 200

 Accounting for BCC

1. Rules for accounting

A BCC means a cooperation contract between two or more venturers in order to carry out specific business activities, but it does not require establishment of a new legal entity. Those activities may be jointly controlled by venturers under BCC (hereinafter referred to as venturers) or controlled by one of them.

1.2. BCC may be conducted under form of jointly controlled assets or jointly controlled operations. Contracting parties of BCC may agree to divide revenues, products or post-tax profits.

1.3. In any cases, when receiving money or assets from other entities in the BCC, they should be recorded to liabilities, not be recorded to owner's equity.

1.4. BCC in the form of jointly controlled assets

a) Jointly controlled asset under BCC mean any asset which is purchased or constructed by BCC venturers the purposes of the joint ventures. Venturers shall record their portions in the jointly controlled assets to their assets account on their financial statements.

b) Each venturer may take a share of the output from the jointly controlled assets and each bears an agreed share of the expenses incurred.

c) A venturer must keep records in the same system of accounting records and record in its financial statements:

- Its share of the jointly controlled assets, classified according to the nature of the assets;

- Any liabilities that it has incurred;

- Its share of any liabilities incurred jointly with the other venturers in the relation to the joint venture;

- Any income from the sale or use of its share of the output of the venture, together with its share of any expenses incurred by the joint venture;

- Any expenses that is has incurred in respect of its interest in the joint venture.

With regard to fixed asset or investment property which is contributed to BCC and the ownership of the contributor is not transferred to the joint ownership of BCC venturers, the receiver shall keep records of assets without recording any increase in assets or business funds; the contributor shall not include a decrease in assets in the accounting records but keep records of the places of assets.

With regard to fixed asset or investment property which is contributed to BCC and the ownership of the contributor is transferred to the joint ownership; during construction of jointly controlled assets, the contributor shall include a decrease in assets in the accounting records and the value of assets shall be recorded to construction in progress. After putting jointly controlled assets into operation, the venturers shall record their increases in assets in conformity with their use purposes according to value of their assets' shares.

1.5. BCC in the form of jointly controlled operations

a) BCC in the form of jointly controlled operations is a joint venture which does not require establishment of a new business entity. Venturers shall fulfill obligations and exercise rights according to the BCC. The joint venture activities may be carried out alongside other ordinary activities of each venture.

b) Each venture shall bear its own expenses incurred from its share in jointly controlled operations. The joint expenses (if any) shall be divided to venturers according to the BCC

c) A BCC venturer must include in accounting records and record in its financial statements:

- The assets of joint venture that it controls;

- The liabilities that it incurs;

- Its share of the income that it earns from the sale of goods or services by the joint venture;

- The expenses that it incurs.

d) When any joint expenses incur, they shall be kept records. If the BCC regulates joint expense allocation, a Table of joint expense allocation shall be made, certified and held by every venturer (original copy). Each venture shall account for joint expenses allocated from BCC according to the table of joint expense allocation together with lawful original documents.

e) In the BCC regulates shares of products, a Table of shares of products shall be made, certified quantity or specifications of shares of products from BCC and held by every venturer (original copy). When receiving products, the venturer must make two copies of receipt slips of products (or delivery order); one venturer shall hold one copy. The receipt slip of product shall be the basis for accounting records and disposal of contracts.

d) In case any joint expenses or income borne or earned by venturers under BCC, the venturers must comply with regulations on accounting similarly to jointly controlled operations.

1.6. BCC in the form of shares of post-tax profits

a) BCC in the form of shares of post-tax profits is usually in the form of jointly controlled operations or individually controlled operations. When giving shares of post-tax profits under BCC, all venturers shall appoint a venture to account for all transactions in BCC, record revenues, expenses, separately keep records of income statement of BCC and make tax declaration. When the venturers decide to enter into BCC in above form, they must consider the risks possibly take due to:

- Any expenses which is not included in the taxable expense due to failure in transfer of assets among venturers, for example:

+ Depreciation expenses incurred from several fixed assets are not accepted by the tax authority because the venturer fails to transfer ownership of the fixed assets to the venture in charge of accounting and tax declaration for BCC;

+ Several expenses of the venturers shall not be accepted by the tax authority because the input invoices do not state the name of the venture in charge of accounting and tax declaration for BCC;

+ Several expenses of the venturers which are unable to transfer to the venture in charge of accounting and tax declaration due barrier of law, for example, the venturer has an invoice of payment of land levies, but the law does not allow that venturer re-lease their land to the venture in charge of accounting and tax declaration, so that the land lease expense shall not be included in the expenses of BCC.

- Risks of policies:

+ The venturer in charge of accounting and tax declaration for BCC may incur accumulated losses, but the output of BCC activities must generate profits. In this case, the enterprise still be required to pay corporate income tax on BCC instead of offsetting BCC profits against other activities‘ losses; if the BCC incurs losses but other activities generate profits, the enterprise may only offset a portion of the loss in proportion to its share of the BCC;

+ If other venturers put their fixed assets into operation of BCC, their depreciation expenses incurred from the fixed assets shall not be considered deductible expenses in the enterprise because they are not used in the enterprise‘s operation (not conformity with revenues from other operations).

b) If the BCC regulates shares of post-tax profits, the venture in charge of accounting and tax declaration must do accounting following the rules below:

- If the BCC regulates that other venturers shall earn an amount of fixed profit regardless of output of BCC activities, in this case, the legal form of the contract is BCC, but it is a lease in the nature. In this case, the venturer in charge of accounting and tax declaration shall has right to administrate and govern the BCC activities, apply accounting method for lease to the contract, and include payables to other venturers in expenses incurred from determination of output of business within a period, in particular:

+ All revenues, expenses and post-tax profits of BCC shall be included in their income statements; earnings per share and financial standards shall be calculated according to total income, expenses and post-tax profits of BCC;

+ Total post-tax profits of BCC shall be included in the item ―Undistributed post-tax profits‖ of the balance sheet, financial standards related to post-tax profit ratio which is calculated including total output of BCC.

+ Other venturers shall record their shares of BCC to revenues from lease.

- If the BCC regulates that other venturers of BCC may only be divided profits if the BCC activities generate profits and they must suffer losses, in this case, even though the legal form of BCC is post-tax profit division but the nature of BCC is division of revenues and expenses, they usually have rights, condition and ability to jointly control operation and cash flow of BCC. The venturer in charge of accounting and tax declaration must apply accounting method for shares of income under BCC to record revenues, expenses and business output within a period, and provide evidence for tax declaration to other venturers, in particular:

+ All revenues, expenses and shares of profits under BCC shall be included in their income statements; earnings per share and financial indicator shall only be calculated according to the revenues, expenses and profits stated in the income statements; the venturer in charge of tax declaration shall provide copies of documents on fulfillment in obligations of BCC to government budget in order to serve the tax declaration of other venturers of BCC;

+ Undistributed post-tax profits of the balance sheet only include shares of post-tax profit of each venturer.

+ Other venturers shall send reports on their shares of revenues and expenses whose tax liabilities are covered stated in the income statements to the tax authority in order to adjust their corporate income tax payables.

2. Method of accounting for BCC in the form of jointly controlled assets

2.1. In case venturers jointly buy jointly controlled assets, the following accounts shall be recorded according to actual amounts of money of each venturer:

Dr 211, 213, 217

Dr 133 – VAT payables (if any).

Cr 111, 112, 331, 341.

2.2. In case venturers construct jointly controlled assets themselves or cooperate with other entities to construct the jointly controlled assets, the following accounts shall be recorded according to actual expenses paid by each venturer:

Dr 241 – Construction in progress (jointly controlled assets in details)

Dr 133 – VAT payables (if any).

Cr 111, 112, 152, 153, 155, 156, 211, 213, etc.

Cr 331, 3411, etc.

2.3. When the construction works are completed and put into operation, the venturers must make declaration and divide the value of the jointly controlled assets. According to the report on shares of jointly controlled asset, venturers shall determine the fair value of each asset to keep records in accordance with regulations of law as follows:

Dr 211, 213, 217 (fair value of shares of jointly controlled assets in details)

Dr 138 – Other receivables (un-approved and recoverable expenses)

Dr 811 – Other expenses (if the fair value of the share of asset is smaller than the construction expense)

Cr 241 – Construction in progress

Cr 711 – Other expenses (if the fair value of the share of asset is greater than the construction expense)

2.4. The method of accounting for expenses or incomes borne or earned by the venturers under BCC in the form of jointly controlled assets and BCC which is converted into the form of jointly controlled operations shall be applied similarly to BCC in the form of jointly controlled operations.

3. Method of accounting for BCC in the form of jointly controlled operations.

3.1. Accounting for contributed capital of jointly controlled operations

a) For the capital contributee

- According to the report on capital contribution of the venturer of jointly controlled BCC, the contributee shall record as follows:

Dr 111, 112, 152, 155, 156, etc.

Cr 138 – Other payables, receivables.

When returning contributed capital to venturers, reverse the above entry. If there is any difference between the fair value of returned asset and the value of contributed capital of venturers, such difference shall be recorded to other income or other expenses.

- If a fixed asset is received without any transfer of ownership, the contributee shall keep records of that asset in their administration system and record to asset held under a trust.

b) For the capital contributor

- According to the report on capital contribution of the venturer of jointly controlled BCC, the contributor shall record as follows:

Dr 138 – Other receivables

Cr 111, 112, 152, 155, 156, etc.

When receiving contributed capital by the contributee, reverse the above entry. If there is any difference between the fair value of received asset and the value of contributed capital of venturers, such difference shall be recorded to other income or other expenses.

- If a fixed asset is received without any transfer of ownership, the contributor shall not record a decrease in fixed assets but keep records of that asset in their administration system and present the place where the asset is located.

3.2. Accounting for own expenses of each venturer

- According to relevant invoices or documents on own expenses borne by each venture in the jointly controlled operations, the following accounts shall be recorded:

Dr 621, 622, 627, 641, 642 (BCC in details)

Dr 133 – VAT payables (if any).

Cr 111, 112, 331, etc.

- When transferring separate expenses to add to operating expense of BCC at the end of the accounting period, the following accounts shall be recorded:

Dr 154 – Work in progress (BCC in details)

Cr 621, 622, 627, (BCC in details)

3.3. Accounting for joint expenses borne by every venture:

a) In the venturer bearing joint expenses:

- When incurring joint expenses borne by every venture, the following accounts shall be recorded according to relevant invoices or documents:

Dr 621, 622, 627, 641, 642 (BCC in details)

Dr 133 – VAT payables (if any).

Cr 111, 112, 331, etc.

- If the BCC regulates shares of joint expenses, a Table of shares of joint expenses shall be made and certified by all venturers, then the following accounts shall be recorded:

Dr 138 – Other receivables (in details for every venturer)

Cr 133 – Deductible VAT (for input VAT).

Cr 3331 – VAT payables (if all amounts of input VAT on joint expenses are deductible, an increase in output VAT payable shall be recorded).

Cr 621, 622, 627, 641, 642.

b) In the venturer whose joint expenses incurred from BCC are not accounted:

According to the Table of shares of joint expenses approved by the venturers (notified by a venturer bearing joint expenses), the following accounts shall be recorded:

Dr 621, 622, 623, 641, 642 (BCC in details)

Dr 133 – VAT payables (if any).

Cr 338 – Other payables (in details for the venturer bearing joint expenses).

3.4. Accounting for products sharing agreement:

- When receiving shares of products from BCC and delivering them to inventory, the following accounts shall be recorded according to receipt slip, delivery order and relevant documents:

Dr 152 – Raw materials (if the shares of products are not finished goods)

Dr 155 – Finished goods (if the shares of products are finished goods)

Dr 157 – Goods on consignment (if the shares of products are sold without delivering to inventories)

Cr 154 – Work in progress (including separate expenses and joint expenses borne by every venturers) (BCC in details)

- When receiving shares of products from BCC and putting them into production of other products, the following accounts shall be recorded according to receipt slip and relevant documents:

Dr 621 – Direct raw materials costs

Cr 154 – Work in progress (including separate expenses and joint expenses borne by every venturers) (BCC in details)

- If the BCC regulates assigning a venturer to sell products instead of sharing products, after issuing invoices to the seller, transferring separate expenses and joint expenses borne by every venturers to costs of goods sold, the following accounts shall be recorded:

Dr 632 – Costs of goods sold

Cr 154 – Work in progress (including separate expenses and joint expenses borne by every venturers) (BCC in details)

3.5. Accounting for revenues from sale of products in case a venturer sells products under a trust and share revenues to other venturers:

a) For the seller:

- When selling products under the BCC, the sell must issue invoices for all sold products and total amounts of sale of products shall be recorded as follows:

Dr 111, 112, 131, etc.

Cr 338 – Other payables or receivables (BCC in details)

Cr 3331 – VAT payables (if any).

- According to provisions of the BCC and the table of revenue allocation, the shares of revenues received by each venture shall be recorded as follows:

Dr 338 – Other payables or receivables (BCC in details)

Cr 511 – Revenues (interests earned by the seller under BCC).

- After comparing joint expenses borne by each venture and shares of revenues earned by each venture, the other receivables and the other payables shall be offset (in details for each venturer), then the following accounts shall be recorded:

Dr 138 – Other payables, receivables.

Cr 138 – Other receivables

- When giving shares of products sold to other venturers (other than the seller), the following accounts shall be recorded:

Dr 338 – Other payables or receivables (every venturers)

Cr 111, 112, etc.

b) For other venturers (other than the seller):

- According to the table of revenue allocation certified by all venturers and documents provided by the seller, other venturers shall issue invoices of their shares of revenues and give them to the seller and the following accounts shall be recorded:

Dr 138 – Other receivables (including VAT if output VAT is shared, in details for the sellers)

Cr 511 – Revenues (BCC in details and amounts of shares).

Cr 3331 – VAT payables (in case of sharing output VAT).

- When the venturers repay for sale of products, the following accounts shall be recorded according to the actual received amounts:

Dr 111, 112, etc. (amounts repaid by venturers)

Cr 138 – Other receivables (in details for every seller).

4. Method of accounting for BCC in the form of post-tax profits

4.1. In case venturers receive fixed shares regardless of business output of BCC (the venturer in charge of accounting and tax declaration shall control the BCC):

a) For the venturer in charge of accounting and tax declaration for BCC

- When receiving money, materials or goods from capital contributors, the following accounts shall be recorded:

Dr 112, 152, 156, etc.

Cr 138 – Other payables, receivables.

- When incurring revenues or expenses incurred from BCC, the venturer in charge shall record total income or expenses similarly to their transactions as prescribed.

- When determining amounts payable to other venturers periodically under BCC, the following accounts shall be recorded:

Dr 627, 641, 642

Cr 138 – Other payables, receivables.

- When returning amounts of money or materials contributed as capital, the following accounts shall be recorded:

Dr 138 – Other payables, receivables.

Cr 112, 152, 156, etc.

If there is any difference between the fair value of returned asset and the value of contributed capital of venturers, such difference shall be recorded to other income or other expenses.

b) For the venturer not in charge of accounting and tax declaration for BCC

- When contributing capital to BCC, the following accounts shall be recorded:

Dr 138 – Other receivables

Cr 112, 152, 156, etc.

- When receiving notification of shares of profits earned from BCC, the following accounts shall be recorded:

Dr 138 – Other receivables

Cr 511 – Revenues (5113)

- When receiving contributed capital, the following accounts shall be recorded:

Dr 112, 152, 156, etc.

Cr 138 – Other receivables

If there is any difference between the fair value of received asset and the value of contributed capital of venturers, such difference shall be recorded to other income or other expenses.

4.2. In case the venturers receive shares of profits depending on the business output of BCC (they have rights to jointly control BCC):

a) For the venturer in charge of accounting and tax declaration

a1) The recording of contributed capital and returning of contributed capital to venturers shall comply with Point 4.1.

a2) When recording revenues of BCC, total revenues included in accounting records in account 511 shall be the basis for comparison, explanation and determination of taxable revenues for BCC:

- Revenues for BCC shall be recorded as follows:

Dr 112, 131.

Cr 511 - Revenues

Cr 3331 – VAT payables.

On the income statement, only shares of revenues are included in the item ―Revenues‖

- Periodically, a decrease in shares of revenues for BCC, the following accounts shall be recorded:

Dr 511 - Revenues

Dr 3331 – VAT payables (if VAT is shared).

Cr 138 – Other payables, receivables.

a3) Total expenses incurred from accounting records shall be the basis for comparison and determination of taxable expenses of BCC:

- When incurring expenses of BCC, the following accounts shall be recorded:

Dr 632, 641, 642, etc.

Cr 112, 331, 154, 155, etc.

On the income statement, only shares of revenues are included in the item ―Expenses‖

- Periodically, a decrease in expenses incurred from BCC borne by venturers, the following accounts shall be recorded:

Dr 138 – Other receivables

Cr 632, 641, 642.

- After determining the corporate income tax payables for BCC, the venturer in charge shall notify other venturers of amounts payable and the following accounts shall be recorded:

Dr 8211 – Expenses incurred from corporate income tax (tax payables of the venturer in charge)

Dr 138 – Other receivables (tax payables of other venturers in the BCC)

Cr 3334 – Corporate income tax (total corporate income taxes payable)

- After comparing joint expenses borne by each venture and shares of revenues earned by each venture, the other receivables and the other payables shall be offset (in details for each venturer), then the following accounts shall be recorded:

Dr 138 – Other payables, receivables.

Cr 138 – Other receivables

b) For the venturer not in charge of accounting and tax declaration

- When contributing capital to BCC, the following accounts shall be recorded:

Dr 138 – Other receivables

Cr 112, 152, 156, etc.

- According to the Table of shares of joint expenses approved by the venturers (notified by a venturer bearing joint expenses), the following accounts shall be recorded:

Dr 621, 622, 623, 641, 642 (BCC in details)

Dr 133 – VAT payables (if any).

Cr 138 – Other payables, receivables.

- According to the amounts of corporate income tax payable notified by the venturer in charge, the following accounts shall be recorded:

Dr 821 – Expenses incurred from corporate income tax in force

Cr 138 – Other payables, receivables.

- According to the table of shares of revenues certified by all venturers and documents provided by the seller, other venturers shall issue invoices of their shares of revenues and give them to the seller and the following accounts shall be recorded:

Dr 138 – Other receivables (including VAT if output VAT is shared, in details for the seller)

Cr 511 – Revenues (BCC in details and amounts of shares).

Cr 3331 – VAT payables (if sharing output VAT).

- After comparing joint expenses borne by each venture and shares of revenues earned by each venture, the other receivables and the other payables shall be offset (in details for each venturer), then the following accounts shall be recorded:

Dr 138 – Other payables, receivables.

Cr 138 – Other receivables

- When the venturers repay for sale of products, the following accounts shall be recorded according to the actual received amounts:

Dr 111, 112, etc. (amounts repaid by venturers)

Cr 138 – Other receivables (in details for every seller).

- When receiving contributed capital, the following accounts shall be recorded:

Dr 112, 152, 156, etc.

Cr 138 – Other receivables

If there is any difference between the fair value of received asset and the value of contributed capital of venturers, such difference shall be recorded to other income or other expenses.

Source: Circular 200