Helpie FAQ

Financial standards

  • Does Curaçao have financial standards?

    Yes, the financial standards have been established by law in the Kingdom Act for Financial Supervision of Curaçao and St. Maarten, Curaçao’s Constitution and the National Ordinance Accounting 2010.

  • What financial standards does Curaçao have?

    The legally established financial standards are:

    • a balanced current account. This means that the current account has to be balanced, that is, current revenues and expenditures should be equal;
    • the capital account may have a deficit. This means that funds can be borrowed to finance capital expenditures, provided this adheres to the Interest Charges Standard and that the Current Account remains in balance;
    The interest charges standard. The interest charges standard means that in a fiscal year the total interest charged may not exceed an amount equivalent to 5% of the average actual revenue realized in the previous 3 years.

  • Why are financial standards important?

    To avoid that the government accumulates an unsustainable debt.

  • Must financial standards be established by law?

    No, but legally establishing financial standards makes the budget policy more transparent and it promotes confidence in the government.

  • Regarding the (modification of the) budget and accountability for expenditures

  • What is the budget?

    The budget contains estimates of the maximum expenditures and the expected revenues. The budget is a National Ordinance that is adopted by parliament and is therefore a law.

  • When does the budget year start?

    The budget year corresponds to the calendar year and as such begins on January 1 and ends on December 31 of the corresponding year.

  • Who has the right to amend and approve the budget?

    The parliament has the right to amend and approve the budget.

  • What does the right to amend and approve the budget include?

    The right to amend and approve the budget means that parliament authorizes the government to spend up to a fixed maximum to achieve certain goals and that no expenditures may be made outside of or above this maximum.

  • Is there an obligation to spend the amounts budgeted in the budget?

    No. By adopting the budget, the government is authorized to spend up to the budgeted maximum, but officially the government can spend less.

  • When does the budget enter into force?

    The national ordinance for the adoption of the budget enters into force on January 1 of the year to which the budget relates. It is deemed to have come into force on that day, if it is first placed in the Official Gazette thereafter.

  • What budgetary system does the government use?

    The government uses the income and expenditure system as its budgetary system. In this system the expenses are accounted for with regard to the financial year in which the expenditure took place. Not the actual charges, but the expenditures are accounted for.

  • What does the government budget consist of?

    The government budget consists of the quantified operational budget and the accompanying explanatory memorandum, including the long-term budget. The operational budget is divided into a current account and a capital account. For the purpose of administering the implementation of the budget, the budget has a quantified administrative budget and a subsequent explanation per line item. The administrative budget is also divided into a current account and a capital account.

  • What is the Current Account?

    The current incomes and expenditures are estimated in the current account. These are the operational incomes and expenditures.

  • What is the Capital Account?

    The capital incomes and expenditures are estimated in the capital account.

  • What is the difference between the operational budget and the administrative budget?

    The difference between the operational budget and the administrative budget is:

    • the operational budget has a higher level of aggregation; it is prepared at the level of economic categories and it governs the ratios between the government and parliament;
    • the administrative budget has a lower level of aggregation; it is prepared at the level regarding the types of costs and it governs the ratios within the governmental departments.

  • What is the long-term budget?

    The government’s long-term budget contains estimates for the year the budget pertains to and for the 3 years thereafter.

  • What is the budget cycle?

    The budget cycle consists of 3 phases:

    • budget preparation
    • budget execution
    • accountability and the granting of discharge of liability by parliament

  • How many years does the budget cycle cover?

    The budget cycle covers a minimum of three years. The budget preparation starts in the year preceding the year the budget pertains to and is concluded when the budget is adopted by parliament. The budget execution occurs during the budget year. The accountability takes place during the year following the year in which the fiscal year was closed. Thereafter there is the discussion in parliament, which must lead to the approval of the accounting and the granting of discharge of liability by parliament.

  • Does the budget cycle end on December 31?

    No, the budget cycle ends with the debate in parliament regarding the annual financial statements and the annual report, which must lead to the approval of the accounting and discharge of liability being granted by parliament.

  • What are budgetary discipline rules?

    These are a set of guidelines intended to control public expenditures with the objective of preventing deviations from the budget adopted by parliament and, when implementing the budget, to achieve conformity with parliament’s right to amend and approve the budget.

  • What is a memorandum of amendment to the budget?

    The budget is a National Ordinance that is adopted by parliament and is therefore a law. It’s only a bill until it’s adopted by parliament and until then it’s called a draft budget. As long as the budget has not yet been adopted, changes to the budget can be made by means of a memorandum of amendment.

  • What is a supplementary budget?

    The budget is a National Ordinance that is adopted by parliament and is therefore a law. While the budget is being implemented, the need may arise to make adjustments to the budget that was adopted by parliament. These adjustments then take place by means of a National Ordinance to modify the budget, known as a supplementary budget.

  • When does the budget take effect?

    The National Ordinance that adopts the budget takes effect on January 1 of the operational year that the budget pertains to. It is deemed to take effect on that day, but only if it is published in the Official Gazette thereafter.

  • What’s the difference between a memorandum of amendment to the budget and a supplementary budget?

    The budget is a National Ordinance that is adopted by parliament and is therefore a law. A memorandum of amendment to the budget and a supplementary budget are both adjustments to the budget. However, a memorandum of amendment to the budget deals with adjusting a budget that has not yet been adopted by parliament (a draft budget/bill), while a supplementary budget, which itself is a law, deals with adjusting a budget that has already been adopted by parliament (a budget/law).

  • Regarding honoring a commitment and validating payment

  • Where should a supplier submit an invoice for payment?

    To the Ministry of Finance. After it’s registered, the invoice will be forwarded to the relevant ministry for further processing.

  • What requirements must an invoice meet?

    The following information should be clearly stated on the invoice.

    • The beneficiary’s name and address.
    • The nature of the work or the supplies or services provided.
    • The date the supplies or services were provided.
    • The basis for calculating the amount.
    • The date and the beneficiary’s signature.
    • The beneficiary’s bank or ‘giro’ account number.

  • Which documents should be included with an invoice when it’s submitted?

    • All the information and statements necessary to substantiate and assess the accuracy of the invoice.
    • The relevant purchase order.
    • The relevant authorization (if required).

  • How and when does payment of an invoice take place?

    Payment usually takes place within two weeks after receipt of the invoice approved by the ministry, by deposit into the beneficiary’s bank account.

  • When is an invoice considered to have expired?

    If it was not submitted within the period prescribed by law, namely 18 months after the beginning of the fiscal year in which the right to payment was obtained.

  • Where can I obtain information regarding outstanding invoices?

    You can contact an employee in the government’s Financial Administration.

  • Where should the payment of a collection order take place?

    A collection order should be paid at the Inland Revenue office within two weeks after receipt. Payment can also be made at local banks by means of a deposit to the Inland Revenue’s account.

  • Where can I obtain information with regard to collection orders received?

    You can contact an employee in the government’s Financial Administration.

  • In which instances is a purchase order required?

    A purchase order is required for each invoice. The purchase order is a guarantee for the supplier in order to obtain payment of his invoice. Invoices that are not accompanied by a purchase order will not be eligible for payment.

  • What can I do if a purchase order is lost?

    You can request (in writing) a duplicate purchase order from the government’s Financial Department.

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