The MSP Revolving Fund is currently managed under the directives of the Revolving Fund Management Board. This is the Terms of Reference of the Management Board revised as of March 2011.

1. Background

The Revolving Fund was established in 1996 with contributions from the Royal Government of Bhutan (RGOB) and the European Commission to enable the Pharmaceutical & Research Unit (PRU) to fund its raw materials needs for traditional medicine production. The Fund is now used in meeting expenses that have a direct short-term and long-term bearing on MSP’s products and ability to generate revenue for the Fund.

2. Objectives

2.1 Primary Objective

• To achieve sustainability in the production of traditional medicines (TMs) and allied products.

2.2 Secondary Objectives

• To promote commercial viability and create business opportunities.

3. Areas of Utilization

The Revolving Fund will be utilized in meeting the following expenditures:

3.1 Purchase of medicinal raw materials (medicinal plants, minerals, animal parts and precious substances)
3.2 Purchase of consumables for production (containers, packaging materials, labels, gunny bags, test chemicals)
3.3 Research & development (small-scale research & publications, product development,)
3.4 HRD (short-term trainings as per approval of the Board)
3.5 Product promotion and publicity (advertisement, product launch, exhibition, trade fair)
3.6 Short and medium term investments (staff loan, fixed deposit, shares)
3.7 Employment of Accountant for the Fund
3.8 Other related expenses- as and when approved by the board (such as daily wages, refreshment and other expenses for conducting Board meetings)

4. Board Members

i. Dr. Karma Lhazeen, CPO, EMTD, MoH (Chairman)
ii. Mr. Ugyen Tshewang, DCAO, AFD, MoH (Member)
iii. Mr. Kado Zangpo, Offtg. Chief Planning Officer, PPD, MoH (Member)
iv. Mr. Ngawang, Chief Program Officer, HCDD, MoH (Member)
v. Mr. Kinga Jamphel, Head, MSP, MoH (Member)
vi. Ms. Tenzin Wangmo, Asst. Marketing Officer, MSP, MoH (Member)
vii. Accountant, Revolving Fund (Member Secretary)

5. Powers & Functions of Board

5.1 To formulate goals, strategies, long term plans and policies for the Fund
5.2 To approve annual work plans.
5.3 To review and endorse the proposal for investment of the Fund.
5.4 To monitor the performance of the Fund.
5.5 To constitute sub-committees for carrying out specific functions.
5.6 To nominate and endorse new Board members.
5.7 To ensure timely auditing of Fund accounts.
5.8 To decide on Board sitting fees as per prevailing norms.
5.9 To write off bad debts and stock shortages/losses.
5.10 To amend rules & regulations of the Fund as and when necessary.
5.11 To authorize for the direct purchase of spare parts when the spare parts are urgently required.
5.12 Any other functions as and when necessary.

6. Functions of the Board Members

6.1 Participate in the periodic Board meetings.
6.2 Provide managerial and technical direction and guidance for the Fund.
6.3 Vote, as and when necessary, in making decisions.

7. Powers & Functions of Chairman

7.1 To accord approval for the disbursement of payments from the Fund.
7.2 To function as the signing authority for all transactions related to the Fund.
7.3 To call and convene Board meetings.
7.4 To represent the Board in other forums as required.
7.5 To convey government directives related to the fund, if any, to the Board members.
7.6 To submit reports to the government as and when required.
7.7 To carry out any other duties pertaining to the Fund.
7.8 To vote, as and when necessary, in making decisions.

8. Functions of Member Secretary

8.1 To compile and submit annual work plans in consultation with the MSP to the Board.
8.2 To organize & coordinate Board meetings.
8.3 To maintain regular financial & accounting records of the Fund.
8.4 To present periodic reports and statements to the Board.
8.5 To carry out any other duties as assigned by the Chairman/Board.
8.6 To vote, as and when necessary, in making decisions.

9. Term of Board Membership

2 years unless otherwise appointed for another term or terminated for various grounds.

10. Frequency of Board Meetings

Minimum twice in a year or as and when deemed necessary by the Chairman/Mgt. Board.

11. Quorum

At least two-third of the members should be present to hold the board meetings and to pass any decision. The decision of the board shall be based on simple majority.

12. Remunerations

Nu. 1,000 (Ngultrums One Thousand Only) shall be provided to the Management Board members as sitting fees from the Fund.

13. Working Procedures

13.1 Annual work plans will be submitted to the board through the member secretary.
13.2 Disbursement of funds from the Revolving Fund will be done by the Accountant after MSP obtains necessary approval from the Chairman.
13.3 Periodic financial reports and account statements, as required by current financial norms of the RGoB, will be prepared and maintained by the accountant and will be submitted to the Board for endorsement.
13.4 The proceeds from the sale of traditional medicines to Drugs, Vaccines & Equipment Division (DVED) and the proceeds from the sale of commercial products will be deposited into the Fund as income of the Fund. The Accountant and the MSP Marketing Section will work together to ensure that the sale proceeds are realized and deposited into the Fund on time.
13.5 The fees collected from tourists visiting the ITMS Museum will be deposited into the Fund as income of the Fund. The Accountant and the Museum In-charge will work together to ensure that the fees collected are deposited into the Fund on time.
13.6 For all other issues not covered by this paper, the existing RGoB rules and regulations will be followed.