On Approval of the Procedures for Accounting and Spending Monetary Grants/Targeted Funding Received by Ministries and Agencies

Minister of Finance of Georgia

Order No 436

27 December 2013

 Tbilisi

On Approval of the Procedures for Accounting and Spending Monetary Grants/Targeted Funding Received by Ministries and Agencies

Under Article 25 of the Law of Georgia on the State Budget of Georgia for 2014 and under Article 3(z) of the Regulations approved by the Government of Georgia, Ordinance No 341 of 17 December 2013 on Approval of the Regulations of the Ministry of Finance of Georgia, I order that:

Article 1

1. The Procedures for Accounting and Spending Monetary Grants/Targeted Funding Received by Ministries and Agencies (Annex No 1) and the Estimate Form for Monetary Grants/Targeted Funding Received by Ministries and Agencies (Annex No 2) shall be approved.

2. Order No 547 of the Minister of Finance of Georgia of 31 December 2012 on Approval of the Procedures for Accounting and Spending Monetary Grants/Targeted Funding Received by Ministries and Agencies shall be void upon entry into force of this Order.

Article 2

This Order shall enter into force on 1 January 2014.

Minister of Finance                                                                                        Nodar Khaduri

Annex No 1

The Procedures for Accounting and Spending Monetary Grants/Targeted Funding Received by Ministries and Agencies

Article 1 - General provisions

1. These Procedures define a mechanism for accounting and spending monetary grants/targeted funding received by ministries and agencies. They shall also apply to monetised grants received in kind.

2. The terms used for the purposes of these Procedures have the following meanings:

a) agencies - budgetary organisations that are using the services of the Treasury Service of the Ministry of Finance of Georgia ('the Treasury Service');

b) targeted funding - funding received for specific purposes under an international agreement ratified by the Parliament of Georgia;

c) monetised grant - the proceeds from the sale of an in-kind grant received by ministries and agencies.

3. These Procedures shall not apply to grants received by ministries and agencies as specified in the Law of Georgia on the State Budget of Georgia for 2014.

Article 2 - Accounting of grants/targeted funding

1. In order to ensure that monetary grants/targeted funding are accounted for and are available for public review, the grants/targeted funding received by ministries and agencies shall be recorded in a register for keeping records of monetary grants/targeted funding received by ministries and agencies ('the register').

2. The following data shall be recorded in the register:

a) the name of the ministry and/or agency that receives and/or administers the monetary grant/targeted funding

b) the address (location) and contact telephone numbers of the ministry and/or agency that receives and/or administers the monetary grant/targeted funding

с) the identification number granted by a tax authority

d) the date (number) of the monetary grant/targeted funding agreement

e) the amount under the monetary grant/targeted funding agreement;

f) the name of the issuer (donor) of a monetary grant/targeted funding.

3. The monetary grant/targeted funding received by ministries and agencies may not be entered into the register only if the presented documents are incompatible with the legislation in force in Georgia.

4. The Ministry of Finance of Georgia shall approve monetary grants/targeted funding received by ministries and agencies by an electronic certificate of estimate of monetary grants/targeted funding ('the certificate') after the data referred to in the second paragraph of this article are recorded in the register.

5. In order to receive approval and a certificate, the information on the transfer of funds and on their conversion, as well as one copy of the completed form provided in Annex No 2 of this Order, shall be submitted to the Ministry of Finance of Georgia. If a monetary grant/targeted funding has not been approved with a certificate, the Ministry of Finance of Georgia shall notify in writing the ministry or agency concerned.

6. The certificate shall be approved electronically by the head and/or deputy head of the Budget Department of the Ministry of Finance of Georgia through the electronic budget management system. The certificate shall be assigned a number and a date.

7. After approval of the annual budget law, it may be modified, based on Article 40 of the Budget Code of Georgia and the approved certificate(s), according to the amount of funds actually transferred to the treasury account (code) used for the funds received in the form of a monetary grant/targeted funding.

8. Monetary grants/targeted funding received by ministries and agencies shall be transferred to the Unified Treasury Account, treasury code 302007000 - funds received in the form of a monetary grant/targeted funding. Expenses incurred by using the funds of a monetary grant/targeted funding shall be returned to treasury code 302009941 of the Unified Treasury Account.

9. The balance available by 1 January of each year shall remain at the disposal of the recipient/administrator of the monetary grant/targeted funding and if it is approved by a certificate, it may be included in the relevant annual budget law according to the seventh paragraph of this article.

10. After modification of the annual budget law according to the seventh paragraph of this article, the monetary grant/targeted funding approved by the Ministry of Finance of Georgia shall be included in the quarterly breakdown approved by the Ministry of Finance of Georgia.

11. According to information available with the Treasury Service and under the tenth paragraph of this article, after modification of the quarterly breakdown, the Treasury Service shall, with the purpose of reflecting funds in the revenue and payment accounts of the budget, perform relevant operations with regard to the cash operations executed by the ministries and agencies with the funds received in the form of grants/targeted funding.

12. The revenues in the form of monetary grants/targeted funding received by ministries and agencies that have been accounted for under these Procedures, and the payments made, shall be included in the annual report and statements on execution of the State Budget of Georgia for 2014.

Article 3 – Administration of monetary grants/targeted funding

1. The Treasury Service shall issue funds within the scope of a monetary grant/targeted funding based on the plans that are set out in the electronic budget management system for administrators of grants/targeted funding according to the grant/targeted funding agreements and the accounting data, as well as according to the certificate(s) electronically approved by the Ministry of Finance of Georgia.

2. The monetary grant/targeted funding shall be broken down in the certificate under the budget classification items by the ministries and agencies receiving a monetary grant/targeted funding, according to the information submitted in the estimate form.

3. If a monetary grant/targeted funding is to be returned to the donor based on conditions defined in the agreement, the administrator of the monetary grant/targeted funding shall submit an estimate form in which the corresponding amount must be stipulated in the Grants item of the economic classification of expenses and, after the request is approved by a certificate, transfer the funds to the account specified by the donor.

4. On the basis of the modification of a grant/targeted funding agreement and/or on the basis of a new estimate submitted to the Ministry of Finance of Georgia during the year by the recipient/administrator of a monetary grant/targeted funding, the funds may be distributed between the budgetary classification items approved by the certificate.

5. A monetary grant/targeted funding shall be spent according to the grant/targeted funding agreement and the legislation of Georgia.

Annex No 2

Monetary Grants/Targeted Funding Received by Ministries and Agencies

Estimate Form

Head of the ministry or agency receiving the monetary grant/targeted funding

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Name of the recipient and the administrator of the monetary grant/targeted funding

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(Donor) organisation issuing the monetary grant/targeted funding

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Agreement details: name, number, date

––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––

Details of the monetary grant/targeted funding 

Currency name

* These data must be presented in a currency unit;

** Section III of the form must reflect according to the budgetary classification items the amount of the monetary grant/targeted funding that is approved/added to the total approved amount after the new (last) transfer, requires changing of the item, is returned to the donor and/or represents the balance of the previous period and that is not included as the amount added to the total approved amount of the current year. 

*** The items shown in these columns are given as an example and when completing the form the ministries/agencies must indicate the corresponding item(s) provided in the classification of financial assets and liabilities and operations associated with them.