Interim Measures for Financial Management of Off-campus Training Institutions (Full Text)

General Office of the Ministry of Education, General Office of the Ministry of Finance, General Office of the Ministry of Science and Technology

General Office of the Ministry of Culture and Tourism General Office of the General Administration of Sports on issuance

Notice of the Interim Measures for the Financial Management of Off-campus Training Institutions

Department of Education Supervision Letter [2023] No. 2

The education departments (education commissions), finance departments (bureaus), science and technology departments (committees and bureaus), cultural and tourism departments (bureaus), sports administrative departments of all provinces, autonomous regions and municipalities directly under the Central Government, education bureaus, finance bureaus, science and technology bureaus, culture, sports, radio, television and tourism bureaus of the Xinjiang Production and Construction Corps:

In order to thoroughly implement the spirit of the "Opinions on Further Reducing the Burden of Homework and Off-campus Training for Students in the Stage of Compulsory Education" issued by the General Office of the CPC Central Committee and the General Office of the State Council, standardize the economic behavior of off-campus training institutions and strengthen financial management, the Ministry of Education, the Ministry of Finance, the Ministry of Science and Technology, the Ministry of Culture and Tourism and the General Administration of Sports have jointly formulated the "Interim Measures for the Financial Management of Off-campus Training Institutions".

General Office of the Ministry of Education, General Office of the Ministry of Finance, General Office of the Ministry of Science and Technology

General Office of the Ministry of Culture and Tourism General Office of the General Administration of Sports

March 2023, 3

Interim Measures for the Financial Management of Off-campus Training Institutions

Chapter I General Provisions

Article 1: These Measures are formulated in accordance with the Education Law of the People's Republic of China, the Private Education Promotion Law of the People's Republic of China, the Accounting Law of the People's Republic of China, the Interim Regulations on the Registration and Management of Private Non-Enterprise Units, the Accounting System for Private Non-Profit Organizations, and the Accounting Standards for Enterprises, in order to standardize the economic behavior of off-campus training institutions and strengthen financial management.

Article 3: These Measures apply to the financial management activities of off-campus training institutions (hereinafter referred to as institutions) that carry out off-campus training for preschool children and primary and secondary school students between the ages of 6 and <>.

These Measures do not apply to the financial management activities of off-campus training institutions that focus on vocational skills.

Article 3 The basic principles of institutional financial management are: to uphold and strengthen the party's overall leadership and implement the party's education policy; Strictly implement relevant national laws, regulations and rules, and adhere to the public welfare nature of off-campus training; Standardize the use of funds, prevent risks in economic activities, and protect the legitimate rights and interests of students, parents, practitioners and other stakeholders.

Article 4 The main tasks of institutional financial management are: to establish and improve the internal financial management system and various financial management systems, and to standardize the economic behavior of the institution; Scientifically implement the institutional budget system, and implement budget management for all business revenues and expenditures; Raise funds in accordance with the law, effectively operate assets, control costs and expenses, standardize the distribution of rights and interests, strengthen financial supervision, and implement the property rights of legal persons in accordance with the law; Establish and improve the internal asset management system, strengthen institutional asset management, and ensure the order of institutional training activities; Strengthen internal control and effectively prevent risks in economic activities.

Chapter II: Financial Management System

Article 5: Institutions shall establish and complete systems for Party organizations to participate in major financial decision-making and supervision, and establish corresponding financial management systems. The legal representative of the institution shall be responsible for the authenticity and completeness of the financial work and financial information of the institution.

Article 6 Institutions shall, in accordance with the unified accounting system of the State, conduct accounting for all kinds of economic and business events that actually occur, fill in accounting vouchers, register accounting books and prepare financial accounting reports.

Article 7 An institution shall set up an independent accounting department, and if it does not have the conditions for establishing a separate accounting department, it shall allocate full-time accounting personnel and designate accounting supervisors. Institutions that do not have an accounting department or are equipped with full-time accounting personnel shall, in accordance with the provisions of the Accounting Law of the People's Republic of China and the Measures for the Administration of Agency Bookkeeping, entrust an intermediary institution that has been approved to establish an accounting agency bookkeeping business to keep books on its behalf.

Article 8 The allocation of accounting personnel by institutions shall be implemented in accordance with the relevant provisions of the "Basic Accounting Work Specifications".

Chapter III: Fundraising

Article 9 The organizers of an institution (the funder or founder, the same below) shall, in accordance with the provisions of the Law of the People's Republic of China on the Promotion of Private Education, the Regulations for the Implementation of the Law of the People's Republic of China on the Promotion of Private Education, the Interim Regulations of the People's Republic of China on the Registration and Administration of Private Non-Enterprise Units, the Company Law of the People's Republic of China, the Regulations of the People's Republic of China on the Registration and Administration of Market Entities, and the Detailed Rules for the Implementation of the Regulations of the People's Republic of China on the Registration and Administration of Market Entities, in accordance with the method, amount and time of capital contribution promised in the institution's articles of association and establishment agreement , fulfill capital contribution obligations on time and in full. The institution shall enjoy the property rights of a legal person over the assets invested by the organizer into the institution, the donated property and the accumulation of training.

Listed companies shall not set up or participate in the establishment of subject-type training institutions for students in the compulsory education stage, and shall not purchase the assets of subject-type training institutions by issuing shares or paying cash; Subject training institutions for students in the compulsory education stage shall not be controlled or invested by foreign capital through mergers and acquisitions, entrusted operations, franchise chains, or the use of variable interest entities.

Primary and secondary schools must not set up or participate in the establishment of off-campus training institutions.

Article 10: After a non-profit off-campus training institution is established, the organizers, responsible persons, and actual controllers must not withdraw capital contributions in any way, and must not occupy or misappropriate the institution's funds and assets through methods such as borrowing funds or using them without compensation.

After the establishment of a for-profit off-campus training institution, the organizer shall not withdraw the capital contribution.

Chapter IV Capital Operations

Article 11 Institutions that set up accounting departments or are equipped with full-time accounting personnel shall establish and improve a budget management system, reasonably draw up budgets or fund use plans in accordance with the actual situation of the institution's development plan, organizer's investment plan and training business, and implement budget management of business revenue and expenditure.

Article 12 All fees and fees of an institution shall be managed and accounted for by the accounting department or full-time accounting personnel, and it is strictly forbidden to set up "small treasuries" and set up accounts outside the books.

After the signing of the contract agreement involving training fees, the business department or personnel shall promptly submit the contract and other relevant materials to the accounting department as the basis for accounting processing, and keep them properly.

Article 13: Institutions collecting training service fees shall issue invoices in accordance with relevant national provisions, and must not fill in content that is inconsistent with actual transactions, must not issue receipts and payment vouchers in the name of the organizer or other names, and must not substitute "white slips" such as receipts for receipts.

Article 14: Training service fees (including those collected in cash) collected in advance by institutions shall all be entered into the special account for training fees of the institution, and shall be managed separately with their own funds, and shall not use other accounts of the institution or accounts other than the institution to collect training fees. Institutions shall, in accordance with relevant national regulations, choose bank custody and risk margin methods to supervise the full amount of training service fees collected in advance.

Off-campus training shall not use training loans to pay training fees.

Article 15 Training service fees collected in advance by institutions shall be managed as liabilities in accordance with regulations, and subsequently recognized as revenue in accordance with the unified accounting system of the State, and it is strictly forbidden to recognize revenue in advance or delay.

Article 16: Institutions shall fully use the "Contract for Off-campus Training Services for Primary and Secondary School Students (Model Text)" to approve student information, and clarify training programs, training requirements, training fees, refund rules, refund methods, liability for breach of contract, dispute handling, and so forth. For training refunds involved, institutions shall, in accordance with relevant national provisions and contractual agreements, smooth the refund process, promptly return the remaining training fees to trainees, and protect the legitimate rights and interests of the public.

Article 17: Institutions shall strengthen cost awareness, establish cost control systems, and strengthen cost management.

Article 18 Institutions shall strictly manage expenses, optimize the structure of expenditures, and the income from financing and training service fees shall be mainly used for training business.

Article 19: Institutions shall establish decision-making systems for the payment of large amounts of funds, clarifying the procedures, methods, and rules for decision-making. A contract shall be concluded for large expenditures, clarifying the rights and obligations of both parties and the liability for breach of contract.

Chapter V Asset and Liability Management

Article 20: Institutions shall establish and complete asset management systems, strengthen and regulate the management of asset purchase, use, and disposal, and preserve the safety and integrity of assets. During the existence of an institution, no organization or individual may intercept, privately divide, misappropriate or misappropriate the assets of the institution. Non-profit off-campus training institutions must not provide external guarantees or lend large amounts of funds, assets and facilities without compensation for a long time.

Article 21 Institutions applying for loans may only be used for their own development. The organizer, responsible person or actual controller must not pass on its own debts to the institution, and the institution must not bear joint and several liability for the debts of the organizer, responsible person or actual controller.

Article 22: Institutions shall establish risk early warning mechanisms, reasonably control the scale of their liabilities, improve their debt structure, and prevent financial risks. Where institutions have financial risks that affect their normal operations, they shall promptly report to the competent departments designated by the localities.

Chapter VI Distribution of Proceeds

Article 23: The use and distribution of the net assets of non-profit off-campus training institutions is to be implemented in accordance with relevant national provisions.

Organizers of non-profit off-campus training institutions are not allowed to pay dividends, receive returns or distribute surplus property from the training institution.

Article 24 The profit distribution of for-profit off-campus training institutions shall implement the relevant provisions of the Company Law of the People's Republic of China and the articles of association of off-campus training institutions.

Chapter VII Financial Liquidation

Article 25 When the organizer of an institution is changed, the organization is separated, merged or terminated, it shall entrust an accounting firm to conduct financial liquidation, comprehensively clean up the assets, liabilities and related rights and obligations of the institution, and compile a property catalogue and a list of claims and debts.

Article 26 Where the termination of running a school by an institution is requested by the institution itself, the institution shall organize liquidation; Where it is revoked by the examination and approval authority, the examination and approval organ is to organize liquidation, and the institution shall cooperate with the examination and approval organ in carrying out liquidation work in accordance with law; Where the school is terminated because it is insolvent and cannot continue to operate, the people's court shall organize liquidation. During the liquidation period, no work unrelated to liquidation shall be carried out.

Article 27 When an institution is terminated, after the liquidated assets have paid the liquidation expenses, it shall pay off the training fees and other expenses of the trainees who should be retired, the salaries of the employees, the social insurance fees and taxes to be paid, and other debts to be repaid.

The remaining property of non-profit off-campus training institutions after paying off the above-mentioned debts shall be used for other non-profit off-campus training institutions or other educational public welfare undertakings in accordance with the provisions of the articles of association of the legal person or the resolution of the decision-making body, and must not be invested in any for-profit legal person organization.

Chapter VIII Financial Supervision

Article 3 Institutions shall, at least at the end of each fiscal year, prepare annual financial and accounting reports, and report financial and accounting reports to the competent departments of the industry in accordance with relevant national regulations through the national comprehensive platform system for supervision and service of off-campus education and training before March 31 of each year.

Article 29 An institution shall establish archives of accounting vouchers, accounting books, financial accounting reports and other accounting materials and keep them properly. The retention period and destruction measures of institutional accounting archives shall be implemented in accordance with the relevant provisions of the Measures for the Management of Accounting Archives issued by the Ministry of Finance and the State Archives Bureau.

Article 30: Institutions shall establish internal audit and audit publicity mechanisms. At the end of each fiscal year, the off-campus training institution shall entrust an accounting firm to audit the annual financial report, and report the audit results to the competent industry department in accordance with relevant national regulations.

Article 31: Institutions shall establish and complete oversight systems such as internal control and financial information disclosure, disclose financial information in accordance with law, and accept supervision and inspection by relevant departments.

Article 32: Where institutions conduct transactions with related parties, they shall follow the principles of openness, fairness, and fairness, set reasonable prices, and regulate decision-making, and must not harm the interests of the state, institutions, practitioners, and students.

Institutions shall establish an information disclosure system for transactions of interested parties, and disclose the circumstances of related party transactions in accordance with provisions. Local departments such as for education, sports, culture and tourism, science and technology at the county level or above shall strengthen supervision of agreements signed between nonprofit off-campus training institutions and interested parties.

"Interested parties" as used in the preceding paragraph refers to the organizers, actual controllers, principals, directors, supervisors, financial leaders, etc. of off-campus training establishments, and organizations or individuals that have a relationship of mutual control and influence with the above-mentioned organizations or individuals, which may lead to the transfer of interests of off-campus training institutions.

Article 33: Local departments such as for education, finance, sports, culture and tourism, science and technology, civil affairs, market supervision, and taxation administration at the county level or above shall, in accordance with their duties, employ methods such as random or key spot checks on the economic activities of off-campus training institutions within their administrative regions, and carry out supervision and inspections, and may also entrust professional institutions to conduct inspections and spot checks. The inspection and spot check situation and the results of the investigation are promptly announced to the public.

Chapter IX Supplementary Provisions

Article 34 These Measures shall take effect on the date of issuance and shall be interpreted by the Ministry of Education, the Ministry of Finance, the Ministry of Science and Technology, the Ministry of Culture and Tourism and the General Administration of Sports.