Then, in the "Basic Theoretical Knowledge of Local ** Special Bonds in 2024", we continue to delve into the basic theoretical content of special bonds and use theoretical knowledge to solve five difficult practical problems.
1. The basic purpose of the special bond is project construction, can it be used for equipment purchase?
2. Some new infrastructure projects are mainly based on software development, can such projects apply for special bonds?
3. How to effectively introduce the special bond issuance process to customers?
4. What should I do if a project changes after receiving special bond funds?
5. The description of project financing in the special bond issuance materials is that "there is no market-oriented financing for the project", can the bank provide supporting financing?
1.The basic purpose of the special bond is project construction, can it be used for equipment purchase?
Let's start with the conclusion: special bonds cannot be used for simple equipment purchases, but they can be used for equipment purchases in construction projects.
As I mentioned in "Knowing the Total Investment of a Project Again", the total investment of a project is composed of three major costs: "project cost", "other project costs" and "preparation fee".
Among them, "engineering costs" include "construction and installation costs" and "equipment and tools purchase costs".
Let's take a look at the "Equipment and Equipment Purchase Costs".
The cost of equipment and equipment purchase refers to the cost of purchasing or self-made equipment that meets the standard of fixed assets and the first set of equipment and furniture for new or expansion projects in accordance with the requirements of the construction project design documents.
As can be seen by definition,The equipment purchase cost that can be included in the total investment of the project is the cost of "necessary for the construction project" and "can meet the standard of fixed assets".
After the qualified equipment purchase expenses are included in the total investment of the project, they will obtain the attribute of "project construction", and it can use the special bond funds according to the regulations.
The most typical example of this is the procurement of medical equipment.
Generally, a hospital construction project, from the start of construction to the real external operation, in addition to the completion of the main construction of the hospital's outpatient building, inpatient and other main buildings, also needs to purchase CT and other medical equipment and related drugs.
Medical equipment and drugs are the content that must be purchased for the external operation of the hospital, and at the same time, medical equipment can form fixed assets, so the purchase cost of medical equipment can be included in the total investment of the project as "the purchase cost of equipment and tools in the project cost".
On the whole, it does not break the provision that "special bonds are used for project construction".
2.Some new infrastructure projects are mainly software development, can such projects apply for special bonds?
This question is somewhat similar to the first one. However, it is not so simple to answer the question clearly, and the breakthrough point lies in analyzing the meaning of "software development" in practice.
Let's take the "Neijiang New Town New Infrastructure Construction Project" as an example.
l Project Name: Neijiang New Town New Infrastructure Construction Project.
l Project owner: Neijiang Investment Holding Group***
l Construction content: Powered by technologies such as 5G, A1, cloud computing, and blockchain, it will provide a wide range of connectivity and an open digital platform for the new city area. The main construction content is the construction of digital information intelligent system, including the construction of smart security, smart fire protection, smart operation, smart service, smart access, environmental detection and other systems, intelligent software and hardware transformation projects and supporting infrastructure construction.
This is a typical new type of infrastructure project in the field of special bonds, and the construction content is a combination of software and hardware, but the main thing is software development and system construction.
The point of doubt for this type of project is that software development cannot form fixed assets, and it does not seem to belong to the category of "project construction". Therefore, can this kind of new infrastructure project apply for special bonds?
Usually, a state-owned enterprise wants to use a software to serve the company's information construction, there will be two forms: the first is to develop a software, because it has no development capabilities, it will find a technology company to develop; The second is to purchase a piece of software and pay the development company an annual fee for the use of the software, which is actually a rental software.
It should be noted here that if you want to ask which form it is in the practical exchange, the company is likely to say "we buy software, we don't have the ability to develop it". "Buying" at this point may also be the first form, because many times they don't know exactly what you want to ask.
At this time, you just need to ask again, "Does your company own this software?"
If it has ownership, it belongs to the first situation, where the state-owned enterprise develops software to form an asset, but only because it has no development ability and entrusts a third-party service to develop it. If the SOE does not enjoy ownership, it belongs to the second situation, the SOE only leases the system and does not form assets on the financial statement, which may also involve some development needs (the ready-made system does not necessarily meet the needs of the SOE).
The first type of property ownership and assets belongs to the scope of project construction and can apply for special bonds.
The above may not be enough to convince you why software development is also a project construction? Let's look at it from another angle.
I mentioned in "** Procurement of Goods, Works and Services (Continued)": ** Procurement items are divided into three categories: goods, works and services. In practice, a project can be simply understood as engineering. For example, when we name a project, it can be said to be a xx project or a xx project.
Then let's take a look at whether there is software development in "engineering" according to the "** Procurement Item Classification Catalog".
We can find that the "intelligent installation engineering" under the "engineering" includes building equipment automatic control system engineering, security monitoring and anti-theft alarm system engineering, smart card system engineering, communication system engineering, satellite and shared television system engineering, computer network system engineering, broadcasting system engineering, fire alarm system engineering, and other intelligent installation engineering.
These contents basically cover the part of "smart security, smart fire protection, smart operation, smart service, smart traffic, environmental detection and other system construction" in the "Neijiang New Town New Infrastructure Construction Project".
Therefore, system construction can also be a type of engineering construction.
3.How to effectively introduce the basic process of special debt business to customers?
This seems to be a very basic question, and often the more basic the question, the more difficult it is to answer well.
At this moment, the customer sitting opposite asks you to introduce the issuance process of special bonds, how do you answer? The issuance process of a special bond is very "unpretentious", that is, from project declaration, to project storage, to quota allocation to formal issuance.
It is important to know that introducing business processes to customers has a "marketing purpose". Seize every opportunity to show your expertise and role to your clients. To answer, we need to answer effectively, and we need to help the other person focus on the important thing and what we can do about it.
I'll give you a reference:
Local special bonds are bonds issued in the name of the people of xx provinces and cities, and it is an act of financing in the capital market.
Special bonds were officially launched in 2015 and began to be issued on a large scale in 2018. It can be said that starting from 2018, the most important thing for the funds needed to carry out infrastructure construction in various places is the issuance of special bonds.
The annual amount of special bonds is about 3Between 5 trillion and 4 trillion, the distribution to xx provinces (cities) is about the scale of xx billion to xx billion, and each district may be divided into xx billion. The allocation of quota mainly depends on the debt situation of each region and the funding needs of the project.
The issuance process of special bonds is actually very simpleThe first step is to apply for project storage. The special bonds are jointly managed by the Ministry of Finance and the state, and the two ministries and commissions have established two project libraries, one is the financial project library and the other is the development and reform project library. If there is a need for special debt funds for projects in various places, the project trust information must be entered into the system in accordance with the regulations, and the process of "entry" is the process of project declaration.
The Ministry of Finance and the Ministry of Finance will review the projects reported by the country according to the audit standards, and two project lists will be formed after the audit is passed, and the intersection of the two project lists is what we call "double pass" and "double storage". Only projects with "double pass" and "double storage" are eligible to issue special bonds.
The second step is to allocate the project credit. After the project has the qualification to issue bonds, the specific amount of special bonds that can be issued needs to be allocated by the financial departments of the city and district.
The third step is to officially release and use. After arranging the issuance quota of each project, the district-level and municipal-level financial departments shall cooperate with the provincial-level financial departments to prepare the issuance materials, and finally the provincial-level financial departments shall carry out the issuance work. After the issuance of special bonds, usually 2-3 days, the funds will be allocated by the provincial level, and finally given to the project for construction.
Therefore, the most critical part of the whole process is to realize the "double storage" of the project. This sentence not only helps the client to grasp the point from the process just described, but also leads to the purpose of the marketing service.
Judging from past experience, the pass rate of the project to achieve "double storage" is not enough. In order to realize the project storage, all localities are working hard to plan the project and plan the project to be more in line with the storage standard.
In fact, the state tells us that special bonds will support project construction in 10 major areas, but it will not tell us the specific review criteria for each type of project to be put into storage. Because if the specific audit criteria are clarified, everyone will "plan" in that direction, so that the auditors at the national level cannot screen out the truly suitable and high-quality projects.
Although we have not announced specific audit standards, we have also explored certain rules and methods, such as:
Next, you can introduce your own service advantages. Remember, it's best to keep it to three or four sentences, and not too long.
4.What should I do if a project changes after receiving special bond funds?
This is an issue about the management of the duration of special bonds.
After a project is approved by the feasibility study report, it can apply for special bond funds. For a project that only reaches the feasibility study approval stage, it is normal for the project to change as the project continues to advance.
Everyone is worried about whether the change of project will affect the use of special bonds and whether there will be compliance risks. As long as there is a reasonable change in the progress of the project, and as long as the scope of use of funds still meets the requirements of special bonds, there will be no risk, and it should continue to be used.
Special bonds are a type of financing method in the public capital market. When a project successfully issues special bonds, the basic information about the project (project unit, construction site, construction content, total investment, etc.) will be disclosed to everyone in the issuance materials.
These basic information only represent the status of the project at the time of issuance, and do not promise that the project will not change after the issuance of special bonds. If there is a change in the project, the solution is very simple, make the latest situation of the changed project public again, and inform the investor that the project has changed.
This information disclosure work is called "disclosure of major matters of local ** special bonds". Note that not all project changes need to be disclosed, but rather when the changes occur that are significant.
What changes are significant" needs to be judged by each locality. Our understanding is that the occurrence of a situation in the project that may affect the financing balance is a material matter.
In practice, this work is similar to the workflow of special bond issuance, which is carried out by the provincial finance department or the finance department of the city with separate planning status, and the same is true for the announcement of **.
Of course, this work is not in real time. Because there are many projects issued every year, there may be hundreds of projects in one place, and if a project is changed and disclosed, the workload will be very huge. Instead, this work is carried out 1-2 times a year, and the changes of projects in each region are collected in batches and disclosed in batches.
At present, from a national perspective, only Henan Province and Heilongjiang Province have announced this part of the content.
The changes announced and disclosed by Henan Province include the change of the project unit, the change of the construction site, the change of the construction content, the change of the construction scale, the change of the investment budget, the change of the technical plan, the change of the financing method, etc.
It is possible that the financial department did not organize this work, and it is also possible that everyone has different judgments on major matters and believes that the changes that have occurred in the region are not major events.
5.The description of project financing in the special bond issuance materials is that "there is no market-oriented financing for the project", can the bank provide supporting financing?
In the previous question, we said that the basic information disclosed by the project when issuing special bonds only represents the status of the project at the time of issuance, and it is normal for the project to change after that, including the method of fundraising.
What is the status of an enterprise when it prepares the implementation plan for special bonds?
Combined with the issuance process of special bonds, in fact, the control of enterprises over the application of special bond funds is relatively weak, except for the active application for warehousing, other warehousing review, quota allocation, and issuance time, enterprises can not be the master.
Even the number of times you can file a declaration is uncertain, maybe only 2-3 times a year, and if you miss this declaration window, you don't know when the next time will be.
For such a low-cost, long-term variety, of course, it is necessary to seize the opportunity. Therefore, the enterprise is likely to apply for the project when it has just obtained the feasibility study approval, or even to apply for special bonds, and hurry to the development and reform department to communicate and urge the feasibility study to approve it quickly.
At this time, the project is not very mature, there is still a distance from the official start of construction, and there are many uncertainties. There are many things that the company may not have thought about the project very clearly, let alone at this time I can predict how much construction funds I can apply for from the bank in the future.
The idea of the enterprise at this time is very simple, in the declaration window period of the special bond, try to get the special bond first. At this time, make a current and preliminary fund raising plan, how much special bond funds you plan to apply, and the rest of the gap will be solved by financial funds or the enterprise's own funds.
After obtaining the special bond funds, with the continuous advancement and gradual maturity of the project, enterprises began to seek bank financing to further reduce the pressure on their own funds.
Whether banks provide financing, they should focus on whether there is a funding gap for the project and whether the operating income can cover the financing principal and interest, rather than whether the need for bank financing is mentioned in the implementation plan of the special bonds.
Special bonds are a type of financing, which is not fundamentally different from other financing methods such as corporate bonds, corporate bonds and bank loans.
If a bank is entangled in this, it is still necessary to pay attention to whether the previous corporate bond prospectus mentions that it is expected to take bank loans in the future, and to see whether the loan due diligence report of the previous bank mentions the next bank loan amount. If it is not mentioned, it is not possible for the enterprise to make loans?
For another example, in the first half of 2022, policy banks launched policy-based financial instruments, because the areas supported by policy-based financial instruments are very similar to those of special bonds, so many enterprise projects have actively applied for policy-based financial instruments after applying for special bonds.
Policy financial instruments are essentially similar to a special type of loan provided by policy banks. Before 2022, there is no policy financial instrument in the market, not to mention that the project unit will write "this project will apply for policy financial instruments of xx billion yuan" in the special bond implementation plan.
It's such a simple logic. When banks do special bond financing, they must not lead themselves into a dead end. The impact of special bonds on bank loans is only reflected in the aspects of "asset collateral" and "competition for operating income". Grasp the substance and ignore the inconsequential forms.
Well, that's it.
We will push the "Practical Guidance for the Issuance of Local ** Special Bonds in 2024" on time next Monday.