Law No. (7) of 1995
Concerning the
Financial Regulations of
Government Departments in the Emirate of Dubai[1]
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We, Maktoum bin Rashid Al
Maktoum, Ruler of Dubai,
After perusal of:
Law No. (5) of 1995 Establishing the Department of
Finance, and
Law No. (1) of 1995 Establishing the Financial Audit Directorate,
Do hereby issue this Law.
This Law will be cited as
“Law No. (7) of 1995 Concerning the Financial Regulations of Government Departments
in the Emirate of Dubai”.
In implementing the
provisions of this Law, the following words and expressions will have the
meaning indicated opposite each of them unless the context implies otherwise:
|
Ruler: |
His Highness the Ruler of
the Emirate of Dubai. |
|
Emirate: |
The Emirate of Dubai. |
|
Government: |
The Government of Dubai. |
|
Government Departments: |
The departments of the Government
of Dubai. |
|
DOF: |
The Department of Finance. |
|
HHRC Director: |
The director of the Ruler’s
Court. |
|
Director General: |
The director general of the DOF. |
|
General Budget: |
The estimated revenue and
expenditure of Government Departments for a particular financial year. |
|
Supplementary Budget: |
The budget of a public corporation
or entity that has no independent legal personality. |
|
Independent Budget: |
The budget of a public
corporation or entity that has an independent legal personality. |
|
Extraordinary Budget: |
A budget prepared for temporary
or emergency purposes. |
The General Budget will be
issued pursuant to a law which contains all estimated revenue and expenditure
of all Government Departments during a financial year.
A financial year will
commence on 1 January and will end on 31 December of each year.
The total estimated
revenue for a financial year will be allocated to cover all estimated general
expenditure for the same year. A particular revenue may not be allocated to
cover a particular expenditure. Collected revenue may not be offset against disbursed
expenditure.
Cash basis accounting will
apply to revenue accounts so that only revenue which is actually collected
during the financial year is recorded in these accounts. A modified cash basis
accounting will apply to expenditure accounts so that expenditure will be recorded
in the accounts of the financial year when it is actually paid, or when it is decided
to be disbursed during the financial year but is not paid by the end of that
year for any reason and is posted to trust accounts.
In the event that no
General Budget law is issued prior to the commencement of a financial year, the General Budget estimates of the
previous financial year will continue to apply as if it was an approved budget. However, disbursements for the projects included in
this budget will be made according to the approved
projects plan until the new budget is issued. Collected revenue and disbursed expenditure
for that period will be recorded in the accounts of the
new budget once it is issued.
The General Budget items
will be classified as follows:
1. Administrative
Classification
Expenditure and revenue of
each Government Department are separately stated.
2.
Economic Classification
Expenditure and revenue
are classified according to the type of revenue or expenditure, so that each
type of revenue or expenditure is stated in a separate chapter that is divided
into specific subcategories and items.
The budget items of each
Government Department will be classified based on the Economic Classification
as mentioned in the preceding Article and based on the needs of each
administrative unit of its organisational structure.
The HHRC
Director will issue instructions to Government Departments to
prepare their estimated annual budgets no later than the end of August of each
year.
Government Departments
will prepare initial estimates of their expenditure based on their plans and
programmes for the relevant financial
year.
Initial estimates of the
general revenue will be prepared based on the projected revenue. When
estimating expenditure and revenue, the instructions issued by the DOF, the budget
classification rules stipulated in Article (8)
of this Law, and the relevant provisions of its implementing bylaw, must be complied with.
Government Departments
will submit their draft estimated budgets to the DOF no later than the end of
October of each year. If any Government Department fails to submit its draft
budget by this deadline, the DOF will prepare this draft budget based on the
current year’s budget taking into account the projected budgetary increase or
decrease and the plans of that Government Department.
The DOF will discuss with
Government Departments the initial estimates of their expenditure based on the
actual expenditure for the previous two (2) years, taking into account the percentage
of increase or decrease in expenditure based on the plan and programmes of each
Government Department, and the limits of the available financial resources.
Revenue estimates will be discussed in accordance with the rules stipulated in
the implementing bylaw of this Law.
Following discussion of the initial estimates of general revenue and
expenditure with Government Departments, the DOF will prepare the draft General
Budget as stipulated in the implementing bylaw of this Law.
The Director General will
submit to the HHRC Director the draft General Budget
organised in chapters and items, together with a draft law issuing the General
Budget and a report on the financial and economic position of the Emirate.
The HHRC
Director will present the draft General Budget to the Ruler
together with the draft law issuing the General Budget and the report on the
financial and economic position of the Emirate no later than mid-December of
each year for approval and issuance.
After the General Budget
law is issued, the DOF will notify the Government Departments covered by this
approved budget of their respective approved budgets for the financial year
together with financial instructions relating to implementation.
Additional appropriations
may be included in the total estimates of the General Budget only with the
approval of the Ruler or his authorised representative upon the recommendation
of the HHRC Director.
Appropriations may be reallocated
from an item to another within the same chapter pursuant to a decision of the
director general of the concerned Government Department. Appropriations may
also be reallocated from one chapter to another pursuant to a resolution of the
Ruler or his authorised representative upon the recommendation of the HHRC
Director. Where necessary, appropriations of a Government
Department may be reallocated to another Government Department subject to
approval of the heads of both concerned departments and pursuant to a
resolution of the Ruler or his authorised representative upon the recommendation of the HHRC
Director. The implementing bylaw of this Law will indicate the circumstances under which
appropriations may be reallocated from one Government Department to another.
General expenditure commitments will be undertaken by the competent
authority in each Government Department in accordance with the laws,
regulations, and bylaws governing its work and the relevant appropriations allocated in the budget.
In principle, an expenditure commitment may not
be undertaken if it results in
financial obligations that extend beyond the current financial year, except in
the following cases:
1. Appointment of Employees
2. Employment, Supply, Lease, Services, and Maintenance Contracts
These contracts may be
concluded for a maximum term of three (3) years. The term of any such contract may
be extended beyond this period subject to approval of the HHRC
Director, provided that the annual amounts disbursed in
relation to these contracts are within the limits of the annual
appropriations allocated in the budget for this purpose.
3.
Project Contracts
These contracts may be concluded
based on the overall cost of the project, provided that the disbursement of payments during the financial year
is within the
limits of the appropriations allocated to the project in the budget.
An expenditure will be
settled, disbursed, or paid in accordance with
the rules and procedures stipulated in the implementing bylaw of this Law, provided that the
expenditure is specified and payable in accordance with the laws and bylaws
applicable to Government Departments covered by the General Budget, and that relevant appropriations are available.
In the event that any
project included in the budget of a financial year is not
completed during that financial year, the undisbursed balance of the relevant appropriations will be included in
the budget of the upcoming financial year.
General revenue will be
collected and deposited according to the regulations in force. Revenue of all Government
Departments will be transferred to the general revenue account of the DOF. The
implementing bylaw of this Law will stipulate the types and classification of
revenue and will set guidelines for revenue items. The DOF will set the rules
and implementing procedures required for this purpose.
In order for the DOF to
follow up budget implementation, each
Government Department will submit to the DOF each month a statement of the
expenditure, revenue, and balances of its unbudgeted accounts and a statement
of the adjustments of its bank accounts, no later than the end of the second
week of the following month. The DOF will issue the necessary instructions in
this regard.
The DOF will provide
Government Departments with funds within the limits of the appropriations
allocated in the General Budget to cover the expenditure of each Government
Department. For this purpose, the DOF will set a financial year programme that enables
Government Departments to perform their duties and implement their plans and
programmes in accordance with the implementing bylaw of this Law.
An internal financial
audit unit will be established within each Government Department and will
report to the director general of the Government Department. This unit will
audit the implementation of the budget of this Government Department. The
implementing bylaw of this Law will determine the
functions of these units.
The revenue which is actually collected
as at the end of the
financial year will be included in the financial statements of a Government
Department and will be classified into their respective categories. Reasons for
any increase or decrease in the collected revenue compared to the projected
revenue will be stated in these statements.
The financial statements of
each Government Department will include the expenditure recorded in the accounts of the financial year,
including expenditure for which payment vouchers are duly issued and which is deducted
from its respective items and paid during the financial year, as well as
expenditure which is decided to be disbursed during the financial year and is posted to trust accounts.
The consolidated financial
statements will include the total revenue
which is actually collected, and the total expenditure which is paid, or which is decided to be disbursed,
during the financial year and is posted to trust accounts. The consolidated financial statements will also
indicate the amount of any surplus or deficit so that surplus is credited to,
and deficit is debited from, the general reserve account. If the credit balance
in the general reserve account is not sufficient, the DOF will take the
appropriate action to cover the deficit.
The implementing bylaw of
this Law will set the principles and rules that must be followed in preparing the
financial statements of Government Departments and the consolidated financial
statements. The HHRC Director will issue instructions
in this regard on an annual basis.
Government Departments may
open non-budgetary intermediate accounts as required for the flow of financial
processes, in accordance with the rules stipulated in the implementing bylaw of this Law.
Subject to approval of the
Ruler or his authorised representative based on the recommendation of the HHRC
Director, exemptions from payment of all or part of the
amounts that become payable for any reason to the Government may be granted.
All
documents, instruments, and records related to a financial year will be
maintained for fifteen (15) years after this financial year and may be
destroyed after the expiry of this period in accordance with the rules
stipulated in the implementing bylaw of this Law. This period may be reduced or
increased upon approval of the HHRC Director.
The implementing bylaw of
this Law will be issued pursuant to a resolution of the HHRC
Director, and will include all rules required for the
implementation of this Law. The Director General will issue detailed financial
circulars and instructions to indicate the relevant procedures that must be
followed and the documents that must be used.
All draft laws, decrees,
and regulatory resolutions of financial impact will be submitted to the DOF for
opinion before they are presented to the Ruler or his authorised representative
for issuance.
The provisions of this Law
will apply to public corporations and authorities which have Independent
Budgets or Supplementary Budgets with respect to all matters for which no provision is stipulated in their establishing
laws, decrees, resolutions, memoranda of association, or financial bylaws.
Any provision that
contradicts the provisions of this Law will be repealed.
This Law will be published
in the Official Gazette and will come into force on the day on which it is
published.
Maktoum bin Rashid Al Maktoum
Ruler
of Dubai
Issued in Dubai on 14 December 1995
Corresponding to 22 Rajab 1416 A.H.
© 2019 The Supreme Legislation
Committee in the Emirate of Dubai
[1] Every effort has been
made to produce an accurate and complete English version of this legislation.
However, for the purpose of its interpretation and application, reference must
be made to the original Arabic text. In case of conflict, the Arabic text will
prevail.