The Ministry of Finance ("MOF") has released the Circular on Matters Relating to the Promotion of the Efficient Use of Local Stock Financial Funds (the "Circular").
The Circular specifies the scope of carried-over and surplus funds and the measures for the cleaning up of the funds, regulates the procedures for withdrawing the carried-over and surplus funds, and sets out the establishment of a periodic reporting system for stock financial funds. Departmental budget surplus funds and funds which have been carried over for over two years (including infrastructure funds and non-infrastructure funds) shall be withdrawn to be used on an overall planning basis by the financial departments at the same level. Funds which are withdrawn for use on an overall planning basis shall be separately accounted for as accrual accounting matters, and shall be used within two years. The Circular indicates that financial departments at all levels shall aim at stabilizing growth, promoting reforms, adjusting structures and benefiting the people's livelihood, and for funds which shall be used according to their original purposes, the financial departments shall allocate the funds to be put into use; funds which are not required to be used according to their original purposes shall be withdrawn and mainly used on an overall planning basis in shantytown transformation, urban infrastructure, railway and highway construction, major water conservancy projects, and other key areas to improve the efficiency of the use of financial funds.