On 14 June 2005, the National Assembly issued the Law on State Auditing ("Law"). The Law provides for legal position, function, tasks, powers and organization of State Auditing; tasks, powers of State auditors, audited units and relevant organizations, individuals; operations and ensuring operations of the State Auditing.
The main contents of this Law are as follows:
Legal position and function of the State Auditing: State Auditing is a special agency in the field of state financial examination established by the National Assembly, operates independently and solely complies with the laws; has function of auditing financial report, observance, operations of agencies, organizations which manage, use budget, money and property of the State.
Organizational system of State Auditing: It is organized and managed concentratedly and unifiedly including managing system, special State Auditing, regional State Auditing and non-productive agencies.
Basis for issuance of a decision on auditing: State Auditor in-chief issues a decision on auditing upon one of the following basis: (i) annual auditing plan of State Auditing; requirement of the National Assembly, the Standing Committee of National Assembly, the Government, the Prime Minister; (ii) requirement of Standing of People’s council, People’s committee; proposal of units which are not State-owned enterprises but receive subsidy of the State, are guaranteed by the State, units accepted by State Auditor in-chief which are not in annual auditing plan of State Auditing.
Value of Auditing report: confirming correctness, faithfulness of financial reports, State budget balance sheets; assessing observance of the laws, economic effect, validity in management, use of budget, money and property of the State.
Audited units pursuant to the Law include:State owned enterprises; ministries, ministerial-level agencies, Government agencies and other central agencies; etc. Moreover, units which are not State-owned enterprises but receive subsidy of the State, are guaranteed by the State can hire Auditing enterprises to audit. Such Auditing enterprises must audit upon standards, process of State Auditing and send Auditing reports to State Auditing.
Rights of audited units: refusing to furnish information, documents which are not in connection with auditing contents; proposal for changing a member of auditing group upon evidence for his unfairness as conducting his task; claiming for activities of members of auditing group during conducting their tasks, petitioning for auditing assessment, confirmation; claiming State Auditing, Auditors for compensation.
Settlement of petition on State Auditing: within 30 days (45 days for complicated cases) from the date of receiving a petition on auditing report of an audited unit, State Auditor in-chief must consider, settle such petition.
The Law will take effect from 01 January 2006.
Consulted by InvestConsult Group
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