Luật Kiểm toán Nhà nước số 37/2005/QH11

NATIONAL ASSEMBLY OF THE SOCIALIST REPUBLIC OF VIETNAM

THE XITH TERM , 7 TH SESSION

From the 5th of May 2005 to the 14th of June 2005

STATE AUDIT LAW

Pursuant to the 1992 Constitution of the Socialist Republic of Vietnam, which was amended and supplemented under Resolution No. 51/2001/QH10 of December 25^th, 2001 of the X^th National Assembly, the 10^th session;
Pursuant to the Law on Organization of the National Assembly;
This Law regulates on state audit

Chapter I

GENERAL PROVISIONS

Article 1. Coverage of Regulation

This Law regulates on the legal position, mandates, tasks, powers and organization of the State Audit; tasks and powers of the State auditors, the audited entities and relevant individuals and organizations; the activities and assurance for the activities of the State Audit.

Article 2. Objects for application

1. The audited entities;

2.The State Audit;

3. Other organizations and individuals concerning to state audit activities.

Article 3. Purposes of audit

State audit activities are aimed at serving the check and supervision of the State on management and utilization of the State budget, money and assets; contributing to practicing thrift, fighting against corruption, losses and wastes, detecting and preventing any legal violations; enhancing efficiency in using the State budget, money and assets.

Article 4. Explanation of terms and expressions

In this Law, the terms and expressions hereunder shall be understood as follows:

1. Audit activities of the State Audit shall mean the check, evaluation and certification over the accuracy and integrity of financial statements; their compliance with law; and the economy, effectiveness and efficiency in management and use of the State budget, money and assets;

2. Financial statement audit shall mean the style of audit aiming at checking, evaluating and certifying the accuracy and integrity of financial statements;

3. Compliance Audit shall mean the form of audit aiming at checking, evaluating and certifying the compliance with law, and any rules and regulations upon which the audited entities are required to follow;

4. Performance Audit shall mean the type of audit aiming at checking and evaluating the economy, effectiveness and efficiency in management and use of the State budget, money and assets;

5. Audit evidence shall mean any document and information concerning to audit having been collected by the State auditors, and is basic to audit evaluation, certification, conclusion and recommendation;

6. Audit reports of the State Audit shall mean documents prepared and published by the State Audit in order to evaluate, certificate, conclude and recommend on contents having been audited;

7. State assets shall mean those properties that are formed with and/or having their origins from the State budget, under the ownership and management of the State, and being accounting objects of the audited entities.

Article 5. Audit objects of the State Audit

Audit objects of the State Audit shall be activities relevant to management and use of the State budget, funds and assets.

Article 6. Responsibilities for the accuracy and integrity of financial statements of agencies and organisations using the State budget, funds and assets

1. To be responsible to law for the accuracy and integrity of accounting data and information on the financial statements issued;

2. To base themselves on the provisions of law to set up and maintain proper and efficient performance of internal control system;

3. To organise internal audit in line with legal provisions in order to make appraisal on quality and credibility of economic and financial information; to safeguard assets and the execution of law, regulations and policies of the State and the rules and statutes of the entity.

Article 7. Operational principles of the State Audit

1. Independence and abidance by law only;

2. Integrity and objectivity.

Article 8. The State audit standards

1. The State audit standards shall encompass regulations on performance principles, conditions on and requirements for professional ethics, capability and ability of the State auditors; regulations on audit profession and the ways of dealing with relations arisen in the course of audit upon that the State auditors are required to follow while carrying out audit activities; are the basis for checking and evaluating audit quality and professional ethics of the State auditors.

2. The National Assembly Standing Committee shall prescribe the process of designing and issuing system of state audit standards.

3. The State Auditor General shall base on the resolutions of the National Assembly Standing Committee to design and issue the system of state audit standards.

Article 9. Value of audit reports

1. The audit reports of the State Audit shall certify the correctness and truthfulness of financial statements and the State budget settlement reports; appraise the compliance with law, the economy, effectiveness and efficiency in management and use of the State budget, funds and assets.

2. The audit reports of the State Audit shall be among the bases which:

a) The National Assembly shall use in the process of considering and deciding on the state budget estimates, and to determine the methods of allocating the central budget, and to decide on the national important projects and works invested by the State budget resources; to review and ratify the State budget settlement and use in the oversight of execution of the State budget, the national financial and monetary policies, the resolutions of the National Assembly on the State budget, the national important projects and works, the socio-economic development programmes, and other important capital construction projects and works;

b) The Government, the state management agencies and other organisations and agencies of the State shall use during the management, operation and implementation of their duties;

c) The People's Councils shall use in the process of considering and deciding the estimates and methods of allocating and overseeing the local budgets; approving the local budget settlements;

d) The People's Courts, the People's Procuracies and investigation agencies shall use in the process of handling acts of violating economic and financial legislations;

e) The audited entities shall implement the audit conclusions and recommendations by the State Audit on irregularities in the financial statements and mistakes concerning the compliance with law; implement corrective methods over weaknesses in their activities detected and recommended by the State Audit.

3. Agencies or competent persons who use the audit conclusions shall decide themselves on the acceptance of audit conclusions of the State Audit and be responsible to law for such decisions.

Once accepted by agencies and/or competent persons, the audit conclusions shall be obliged to follow.

Article 10. The responsibilities of organisations and individuals concerning to state audit activities

1. Organisations and individuals concerned to the audit operations shall be responsible for supplying in full and on time accurate information and documents as so requested by the State Audit, the State auditors and shall be responsible to law for the accuracy, truthfulness and objectivity of the information and documents provided;

2. The competent State agencies shall bear responsibility for addressing fully and on time the audit conclusions and recommendations by the State Audit as their receiving the audit reports, and shall send the State Audit a report on the results thereof;

Article 11. Application of International treaty

In case of international treaties on state audit that Vietnam has signed or acceded to have provisions different from those regulated by this Law, the international treaties shall prevail.

Article 12. Forbidden acts

1. The State Audit and the State auditors shall be strictly banned against the following acts:

a) to cause trouble, difficulty and annoyance to the audited entities;

b) to interfere illegally into normal operations of the audited entities;

c) to take brides;

d) to misreport or to report inadequately on audit results;

e) to abuse the working position and authorities for personal interests;

f) to reveal the State secrets and professional confidentiality of the audited entities;

g) to reveal information on audit conditions and results that have not been officially disclosed yet;

h) other acts forbidden by law.

2. The following acts shall be forbidden towards the audited entities and relevant organisations and individuals:

a) to refuse the provision of information and documents necessary for the audit under the request of the State Audit and the State auditors;

b) to cause obstructions to the work of the State Audit and the State auditors;

c) to report wrongly, untruthfully, insufficiently and impartially on the information concerning the audit of the State Audit;

d) to corrupt and to bribe the State auditors;

e) to conceal acts of violating financial and budgetary regulations;

f) other acts forbidden by law.

3. Every organisation and individual shall be strictly forbidden to illegally interfere into the operations of the State Audit.

Chapter II

LEGAL POSITION, MANDATES, TASKS, POWERS AND ORGANISATION OF THE STATE AUDIT

SECTION 1. LEGAL POSITION, MANDATES, TASKS, POWERS OF THE STATE AUDIT

Article 13. Legal position of the State Audit

The State Audit shall be the agency specializing in the field of checking the State finance established by the National Assembly, performing independently and subject only to law.

Article 14. Mandates of the State Audit

The State Audit shall have mandates for auditing financial statements, the legal compliance and the performance of every agency, institutions managing and using the State budget, funds and assets.

Article 15. Tasks of the State Audit

1. to decide its annual audit plan and report to the National Assembly and the Government prior to the implementation thereof;

2. to organise the implementation of annual audit plan and audit tasks as may be requested by the National Assembly, the National Assembly Standing Committee, the Government and the Prime Minister;

3. to consider and make decisions on audits at the request of the People's Council’s Standing Boards, and of the People's Committees of the provinces and the centrally-run cities.

4. to submit opinions of the State Auditor General to the National Assembly for reviewing and determining on the State budget estimates, and deciding on methods for the allocation of the central budget and on the national important projects and works, and for ratifying the State budget finalization;

5. to join hands with the Economic and Budgetary Committee of the National Assembly and with other agencies of the National Assembly and the Government in considering and reviewing reports on the State budget estimates, methods of allocating the central budget, ways of adjusting the State budget estimates, methods of arranging funds for the national important projects and programmes decided by the National Assembly, and the State budget finalisation;

6. to work with the National Assembly's Economic and Budgetary Committee, as may be requested, in oversight upon the implementation of laws and resolutions of the National Assembly, resolutions of the National Assembly Standing Committee in the field of finance and banking, and on the supervision of the execution of the State budget and financial policies.

7. to collaborate with the agencies of the Government and the National Assembly, as may be requested, in the preparation and appraisal of law and ordinance projects;

8. to report annually audit results and results of implementing the audit recommendations to the National Assembly, the National Assembly Standing Committee; To send the audit reports to the Council of Nationalities and other Committees of the National Assembly, the State President, the Government, the Prime Minister; And, to provide audit results to the Ministry of Finance, the People's Councils of the audited localities and other agencies as stipulated by law;

9. to organise for the publicity of the reports of audit results under the provisions in Article 58 and 59 of this Law, and other regulations of the legislations on the State finance and budget;

10. to transfer audit profiles to investigation agencies and other competent agencies of the State for examining and dealing with cases having signs of legal violations committed by the organisations and individuals detected through the audit activities;

11. to maintain audit profiles; to keep secret accounting documents, data and information on operation of the audited entities according to the provisions of law;

12. to perform international cooperation in the field of state audit;

13. to organise and manage scientific researches, work of training, fostering and developing human resources of the State Audit;

14. to organise examinations and to issue the State auditor certificate;

15. to direct and instruct on internal audit profession and operation, and on the use of internal audit results of agencies and institutions as provided for in Article 6 of this Law;

16. To carry out other tasks as regulated by law.

Article 16. Powers of the State Audit

1. to request audited entities and relevant organizations and individuals to provide fully and on time information and documents necessary for audit work; to ask functional organs for their cooperation to carry out the assigned tasks; to ask the State organs, mass associations, social organizations and citizens for assistance and creation of favorable conditions to do audit tasks;

2. to request the audited entities to implement the conclusions and recommendations of the State Audit concerning the irregularities in their financial statements and on acts of violating the legal compliance; and the recommendations on carrying out corrective actions to weaknesses in operations of the entity detected and recommended by the State Audit;

3. to check the audited entities in their implementing conclusions and recommendation of the State Audit;

4. to recommend to the competent State organs for requesting the audited entities to implement the audit conclusions and recommendations on cases of irregularities in the financial statements and other wrongdoings against the legal compliance; to request for the resolution according to the provisions of law of case of failing to implement or to implement insufficiently and unduly the conclusions and recommendation of the State Audit;

5. to recommend the competent State organs for their treatment towards acts of violating law committed by the organisations and individuals explicitly highlighted through the audit activities;

6. to ask competent organs to treat, within their scope of competence, organisations and individuals whose actions impede the audit work of the State Audit or who provide distorted, untruthful information and documents to the state auditors and the State Audit;

7. to refer for professional assessment where necessary;

8. to authorize or to hire an audit firm to carry out the audit of organs, organizations enjoying the State budget, funds and property; the State Audit shall bear responsible for the correctness of data, documents and audit conclusions issued by the firm;

9. to recommend to the National Assembly, the National Assembly Standing Committee, the Government, the Prime Minister and other State management agencies for amending and supplementing regimes, policies and laws to turn them into appropriate.

SECTION 2. STATE AUDITOR GENERAL AND STATE DEPUTY AUDITOR GENERAL

Article 17. The State Auditor General

1. The State Auditor General shall be the head of the State Audit and responsible for all the organisations and activities of the State Audit to the National Assembly, the National Assembly Standing Committee and the Government.

2. The State Auditor General shall be elected, dismissed and removed from office by the National Assembly on the proposal of its Standing Committee after discussion and agreement with the Prime Minister; criteria for choosing a State Auditor General shall be regulated by the National Assembly Standing Committee.

3. The tenure of the State Auditor General shall be seven years, being eligible for re-election of not more than two terms.

4. The salary and other regimes for the State Auditor General shall be equal to those of the chairmen of the Committees of the National Assembly and shall be determined by the National Assembly Standing Committee on the basis of the remuneration regimes and policies of the State.

Article 18. Responsibilities of the State Auditor General

1. to lead and direct the State Audit to exercise its tasks and powers provided in Articles 15 and Article 16 of this Law;

2. to present reports on audit of the State budget settlement reports to the National Assembly; to bring the annual audit report of the State Audit before the National Assembly when requested so by the National Assembly;

3. to take responsibility subjected to law for all contents of the audit reports of the State Audit;

4. to decide upon and to organise the implementation of specific measures to promote disciplines and rules within state audit operations; to combat corruption, waste and any signs of bureaucratic, high-handed and authoritarian behaviors of the State Audit's officials and staffs;

5. to set rules and regulations on functions, duties, powers and organizational structure of units subordinated to the State Audit;

6. to submit to the National Assembly's Standing Committee for decision the workforce, the establishment, merging and dissolution of the units under the organisational frame of the State Audit;

7. to exercise measures to ensure independence of the audit operation of the State Audit;

8. to review and deal with complaints about auditing reports;

9. to perform any other tasks as so regulated by law.

Article 19. Powers of the State Auditor General

1. to issue audit decisions;

2. to attend the plenary sessions of the National Assembly; the meeting sessions of the National Assembly's Standing Committee and of the Government on relevant issues;

3. to make recommendations to ministers, heads of the government-affiliated agencies, other organs at the central level, chairmen/women of the People's Committees of the provinces and the centrally-governed cities, leaders of the immediate higher level of the audited entities in order to have appropriate treatments within their scope of competence towards the organisations, individuals who have committed acts of impeding the audit activities of the State Audit, of providing false information and incorrect documents to the State Audit, failing to implement or to implement insufficiently the conclusions and recommendations of the State Audit. In case that the conclusions and recommendations of the State Audit are not addressed or addressed unsatisfactorily, the State Auditor General shall petition the competent persons for consideration and treatment thereto according to the provisions of law.

4. to determine on auditing the activities under the request of the entities as provided for in Section 12, Article 63 of this law and of other agencies not present in the annual audit plan of the State Audit.

5. to determine on sealing up the documents and on checking the accounts of the audited entities or of individuals concerned under the request of the leaders of the audit teams.

6. to issue, instruct, review and organise the implementation of the state audit standards; to promulgate decisions, directives and working policies; to set forth auditing professional statutes, processes and methodology to apply for the organisation and operation of state audit; and to provide for specific regulations on audit procedures and profiles.

Article 20. State Deputy Auditor General

1. The State Deputy Auditor General shall be assistant to the State Auditor General and be assigned by the State Auditor General to direct some working domains and shall be accountable to the State Auditor General for the assigned tasks. When the State Auditor General is absent, one State Deputy Auditor General shall be authorized by the State Auditor General to lead the State Audit.

2. The State Deputy Auditor General shall be appointed, relieved from duty or dismissed by the National Assembly's Standing Committee on the proposal of the State Auditor General.

3. The tenure of the State Deputy Auditor General shall be seven years.

4. The salary and other regimes for the State Deputy Auditor General shall be equal to those of the vice chairmen of the Committees of the National Assembly and shall be determined by the National Assembly's Standing Committee on the basis of the remuneration regimes and policies of the State.

SECTION 3. ORGANISATION OF THE STATE AUDIT

Article 21. Organisational system of the State Audit

1. The State Audit shall be organised and managed in a centralized and unified manner which shall be comprised of the governing organs, the specialized State Audit units, the regional State Audit offices and the non-business units.

2. The National Assembly's Standing Committee shall prescribe in details the organisational structure of the State Audit.

The State Auditor General shall regulate in details on the functions, tasks, powers and organisational framework of the State Audit-affiliated integral units.

 The number of specialised State Audit units and regional State Audit offices at different periods of time shall be defined on the basis of duty requirements being submitted by the State Auditor General to the National Assembly's Standing Committee for decision.

Article 22. Specialised State Audit units

The specialised State Audit units shall be ones directly affiliated to the State Audit and shall perform specialised audits of agencies, organisations at the central level.

Article 23. Regional State Audit offices

The regional State Audit offices shall be directly under the State Audit and shall perform audit of agencies, organisations at the local levels within their geographical area, and to discharge any other audit duties assigned by the State Auditor General. The regional State Audit offices shall have legal person status as well as their own seals, accounts and offices.

Article 24. Chief Auditor and Deputy Chief Auditor

The Chief Auditors shall be heads of the specialised State Audit units and the regional State Audit offices. Being assistant to the Chief Auditors shall be the Deputy Chief Auditors. The Chief and Deputy Chief Auditors shall be appointed, removed from duty and dismissed by the State Auditor General.

SECTION 4. STATE AUDIT COUNCIL

Article 25. Establishment and dissolution of the State Audit Council

1. The State Auditor General shall set up the State Audit Council to provide him advice in his reviewing important audit reports or re-evaluating the audit reports as so requested by the audited entities, and to assist him to handle any petitions pertaining to the audit reports.

2. The State Auditor General shall decide on the establishment of the State Audit Council, and on its membership and working norms. The State Audit Council shall be chaired by one State Deputy Auditor General. Basing on each specific case, the State Auditor General shall be entitled to inviting experts from the outside to join the Council. In such cases that the audit objects are connected with the State secrets and national security, the State Auditor General shall then act as the chairman of the Council.

3. The State Audit Council shall be automatically dissolved by itself after ending its tasks.

Article 26. Working principles of the State Audit Council

The working principles of the State Audit Council shall be of collective discussions and of vote in favour of the majority, opinions of the minority shall be reserved and reported to the State Auditor General. Every opinion of the State Audit Council members shall be written down in the minutes of the Council. The minutes and other documents of the State Audit Council shall be kept in custody and maintained in the audit profiles of the State Audit.

Chapter III

STATE AUDITOR AND AUDIT COLLABORATOR

Article 27. The State auditor title

1. The State auditors shall be the State public servants appointed to the audit level to perform audit tasks.

2. The State auditor title shall include the following scales:

a) Probationary auditor;

b) Auditor;

c) Principal auditor;

d) Senior auditor.

3. The specific tasks, powers and criteria of every scale of the State auditors shall be specified by the National Assembly's Standing Committee.

Article 28. Jurisdiction for appointment and dismissal of the State auditor

1. The appointment and dismissal of the Auditors and the Principal Auditors shall be decided by the State Auditor General in conformity with law.

2. The appointment and dismissal of the Senior Auditor shall be decided by the National Assembly's Standing Committee according to the provisions of law.

Article 29. General criteria for the State auditor

The State auditors shall be satisfied with the requirements for criteria applied for public cadres and officials according to the provisions of the legislations on public cadres and officials, and shall have the following criteria:

1. to have good moral qualities and sense of responsibility, probity, honesty and objectivity;

2. to possess at least one university degree or higher in one of the fields of audit, accounting, finance, banking, economics, law or in other fields directly relating to the audit activities;

3. to have working experiences in a continuous manner for five years or longer in the field that he or she has been trained, or to have working duration in the audit profession at the State Audit for at least three years.

4. to have passed the programmes on fostering the State auditors and to have been granted a certificate thereto by the State Auditor General.

Article 30. Duties of the State auditors

1. To perform audit tasks and to bear responsibility to the head of his/her audit group, to the leader of his/her audit team for the performance of the assigned audit tasks; to provide appraisal, certification, conclusions and recommendations on those contents audited on the basis of sufficiently collecting and properly evaluating the audit evidences.

2. to conform with the legal provisions, operational principles, standards, processes, professional methodology concerning state audit and any other applicable regulations by the State Auditor General.

3. to be accountable to the State Auditor General and law for the evidences, appraisals, verifications, conclusions and recommendations provided by him/her.

4. to collect audit evidences and to take notes in the audit diaries and other working documents of the State auditors as provided for by the State Auditor General.

5. to keep in secret all information, document gathered in the course of audit.

6. as performing audit tasks, the State auditors shall be required to present and to wear his/her State auditor card.

7. to study and to train himself/herself on a regular manner to improve professional knowledge, skills and ethics; to follow the annual knowledge updating programmes as regulated by the State Auditor General in order to guarantee himself/herself to be capable and competent sufficiently for his/her assignments.

8. to declare in a timely and sufficient manner to the person who will issue the decision on establishment of the audit team in cases prescribed in Article 31 of this Law and on other circumstances that can affect the independence of the State auditors.

9. As committing acts of violating law, they shall be, depending on the nature and extent of their violations, disciplined or examined for penal liability, if causing damage, they shall be required to pay compensation therefor according to law provisions.

Article 31. Circumstances the State auditors disallowed to perform audit

1. to have joined capitals to, to buy stocks of, and/or to have other relations of interest with the audited entities;

2. The entities where he/she had been the leader, chief accountant or in charge of accounting issues for the time limit of at least five years since his/her shift of work.

3. to have relationship as the father, mother, adoptive parents, parents in law, wife, husband, children, brother and sister with the leader, chief accountant or person in charge of accounting affairs of the audited entities.

Article 32. Audit Collaborators

1. The State Audit shall be empowered to use the Audit Collaborators being audit businesses, the local and foreign experts under the form of a duty contract. The budget for using the Collaborators shall be part of the State Audit's annual budget.

2. The Audit Collaborators shall bear the following rights and obligations:

a) to implement the rights and obligations under the contract;

b) to strictly abide by the provisions of the legislations on state audit;

c) to be accountable to the State Audit and applicable laws for the results of his/her discharging duties; in case of committing acts of violating law, it shall be depending on the nature and extent of the violation that he/she shall be disciplined or investigated the penal liability; if causing damages, he/she shall be required to pay compensations thereof according to the provisions of law.

3. The State Auditor General shall specify in details the use of audit collaborators.

Chapter IV

STATE AUDIT ACTIVITIES

SECTION 1. AUDIT DECISION

Article 33. Foundations for issuing the audit decision

The State Auditor General shall issue the audit decision based on one of the following bases:

1. The annual audit plan of the State Audit;

2. The requests from the National Assembly, the National Assembly Standing Committee, the Government, and the Prime Minister;

3. The requests of the Standing Board of the People's Councils or the People's Committees of the provinces or centrally-governed cities; The proposals of the entities as provided for in Clause 12, Article 63 of this Law and of other entities not present in the annual audit plan of the State Audit already approved by the State Auditor General.

Article 34. Audit of the State budget settlement reports

1. The audit of the State budget settlement reports of all levels shall be implemented prior to the National Assembly, the People's Councils ratifying the State budget settlement.

2. In case that such audits have been done but the budget settlement reports have not been ratified yet by the National Assembly/the People's Councils, the State Audit, within its scope of powers and jurisdictions, shall be required to continue to make clear any issues as so requested by the National Assembly, the People's Councils for submission to the National Assembly and the People's Councils at the time decided by them.

3. The audit of the local budget settlement reports that the People's Council has previously ratified which yet to be audited, shall be carried out according to the decision of the State Auditor General.

Article 35. Audit decision

1. The audit decision shall clearly define the following contents:

a) the legal basis for conducting the audit;

b) the audited entities;

c) the objectives, contents and scope of the audit;

d) the audit site and timing;

e) the leader and other members of the audit team;

2. The audit decision shall be sent to the audited entities within at least three days and must be announced within at least fifteen days since its date of signature, excepting for case of unscheduled audit;

3. During the course of audit, if it is deemed necessary to change the contents, scope, location and timing of the audit, and the membership of the audit team, the State Auditor General shall be required decide in writing thereof and send the decision to the audited entities in compliance with the timing specified in Paragraph 2 of this Article.

SECTION 2. TYPES AND CONTENTS OF AUDIT

Article 36. Types of audit

1. Types of audit shall include:

a) the financial audit;

b) the compliance audit;

c) the performance audit.

2. The State Auditor General shall decide on the type of each audit. In case of audit at the request of the National Assembly, the National Assembly Standing Committee, the Government, the Prime Minister, the Standing Committee of the People's Councils or the People's Committees of the Provinces and centrally-managed cities, the type of audit shall be as so requested.

Article 37. Contents of the financial audit

1. The contents of the financial audit on the audited entities in the fields of the State budget revenues and expenditures shall include:

a) money and the equivalents;

b) materials and fixed assets;

c) financial resources, funds;

d) payments in and out of the audited entities;

e) the revenues and expenditures of the State budget at all levels;

f) the balance of the State budget at all levels;

g) the financial investments and credits from the State;

h) the debts and debt settlements of the State;

i) other assets being the accounting objects of the audited entities.

2. The contents of audit on financial statements of entities in the administrative and non-business fields and other institutions using the State budget shall include:

a) money and the equivalents;

b) materials and fixed assets;

c) financial resources and funds;

d) payments inside and outside the audited entity;

e) revenues, expenditures and settlements of revenue and expenditure discrepancies, and operation expenses;

f) the financial investments and credits from the State;

g) other assets being the accounting objects of the audited entity.

3. The contents of audit on the financial statements of the State-run enterprises shall include:

a) fixed assets and long-term investments; current assets and short-term investments;

b) debts payable;

c) owner's capital;

d) incomes, trading expenses, other revenues and expenditures.

e) taxes and payables to the State;

f) outcomes and distribution of trading outcomes;

g) other assets being the accounting objects of the audited entity.

Article 38. Contents of the compliance audit

1. The situation of execution of the State Budget Law, Law on Accounting, legislations on taxation and of other applicable legal documents;

2. the conformity with the internal rules and policies of the audited entities.

Article 39. Contents of the performance audit

1. the situation of implementation of the operational targets and duties;

2. the safeguard, management and utilisation of resources;

3. the system of internal control;

4. the programmes, projects and activities of the audited entities;

5. the effects of the external environment to the economy, effectiveness and efficiency of the audited entities' performance.

Article 40. Decision on audit contents

On the basis of the objectives of each audit, the State Auditor General shall decide whether to audit the entire or a number of parts of the audit contents specified in Article 37 to Article 39 of this Law.

SECTION 3. AUDIT DURATION AND AUDIT LOCATION

Article 41. Audit duration

1. Each audit shall be implemented during a certain period of time. The duration of an audit shall begin from the date of announcement of the audit decision till the end of the audit work at the audited entity;

2. Based on the contents and scope of each audit, the State Auditor General shall specify in details on the duration of the audit.

Article 42. Audit location

The audit work shall be exercised at the audited entities, the head office of the State Audit or at other locations. The State Auditor General shall decide on the audit location.

In case that the audit work is done outside the audited entity's head-office, the audited entity shall be responsible for having relevant documents and files transferred as so specified by the State Auditor General.

SECTION 4. AUDIT TEAM

Article 43. Establishment and dissolution of the audit team

1. The audit team shall be established to perform the audit tasks of the State Audit. The State Auditor General shall decide on the establishment of the audit team on the proposal of the Chief Auditor of the specialized audit units or regional audit offices.

2. The audit team shall be dissolved or liquidated by itself after completing its audit tasks, but shall remain its responsibilities for its appraisals, certification, conclusions and recommendations in the audit reports.

Article 44. Membership of the audit team

An audit team shall be comprised of a leader, an assistant leader, heads of groups and other members. The State Auditor General shall decide the list of membership of the team and shall appoint the leader, the assistant leader and heads of groups at the proposal of the Chief Auditor of the specialized audit units or the regional audit offices.

Article 45. Duties, powers and responsibilities of the audit team leader

1. The leader of the audit team shall have the following duties:

a) to design and submit to the Chief Auditor in order for being given in to the State Auditor General for approval the audit plan of each audit, which are based on its objectives, contents and scope defined in the audit decision; and, to direct the preparation and approve the detailed audit plans of the audit groups;

b) to assign tasks to his Assistant, heads of the audit groups; to instruct and monitor the audit team in performing audits according to the approved audit plan.

c) to organise and review the implementation of the audit team statutes and the applicable standards, procedures, professional methodology of audit, the recording and maintaining of audit profiles as regulated by the State Auditor General.

d) to approve the audit minutes of audit groups and to prepare audit reports of the audit team, and to organise for discussions within the audit team in order to have a unanimity one the comments, certifications, conclusions and recommendations to be presented in the audit report.

e) to safeguard the audit results written in the audit report to the Chief auditor and together with the Chief auditor to safeguard these results to the State Auditor General; to organise for the announcement of the audit results already approved by the State Auditor General to the audited entities, and to sign the audit reports;

f) to manage all members of the audit team during the implementation of the audit tasks;

g) to report, periodically and unperiodically at request of the Chief auditor, on progress of implementing the audit plan, situation and results of audit activities to the Chief auditor for his reporting to the State Auditor General.

2. The leader of the audit team shall have the following powers:

a) to request the audited entities to provide information, documents in need, and to explain issues pertaining to the audit contents; to request for counting assets and comparing liabilities of the audited entities relating to the audit contents; to convene witnesses at the request of the State auditors;

b) to ask organisations and individuals concerned to provide documents, information relevant to the audit contents;

c) to petition the State Auditor General for issuing decision on checking accounts of the audited entities or of individuals concerned at banks, other credit institutions or at the State Treasury under the provisions of applicable laws; to petition the State Auditor General for sealing off documents of the audited entities when there are acts of violating law or of changing, dismantling, hiding and ruining documents involving the audit contents;

d) to request the Assistant, the heads of the audit groups and other members of the audit team to report on audit results; In case that different opinions on audit results existed within the audit team, the leader of the audit team shall be empowered to impose decisions and be accountable for his/her decisions, and at the same time, to report these varied opinions to the Chief auditor.

e) to reserve in writing his/her opinions those differentiate from the appraisals, certifications, conclusions and recommendations contained in the audit reports.

f) to suggest to the State Auditor General petitions to competent state agencies for treatments to acts of violating law committed by the audited entities;

g) to temporarily suspend the team members, for the positions of heads of audit groups downwards, from performing audit tasks when they have committed such violation acts that influence the operation of the audit team, and to instantly make reports to the Chief auditor; with case of serious offences, to the State Auditor General;

h) to propose commending and awarding or disciplining the Assistant leader, heads of audit groups and other members of the audit team when they record unexpected achievements or commit mistakes in the process of audit.

3. The leader of the audit team shall have the following responsibilities:

a) to be responsible to the Chief auditor and the State Auditor General for the activities of the audit team.

b) to be accountable to law for the correctness, integrity, objectivity of appraisals, certification, conclusion and recommendations in the audit report prepared by the audit team.

c) to assume joint liability for offences committed by the team members;

d) to assure living and working conditions for the audit team during the audit in compliance with the provisions by the State Auditor General;

e) to answer for decision on the temporary suspension of task implementation of the team members from the position of heads of groups downwards;

Article 46. Assistant leaders of the audit team

Assistant leader of an audit team shall be assistant to the team leader and shall discharge such duties as assigned by the team leader and be responsible to the team leader for performing the assigned tasks.

Article 47. Duties, powers and responsibilities of heads of audit groups

1. The heads of the audit groups shall have the following duties:

a) to prepare the detailed audit plans to be submitted to the audit team leader for approval and to organise for the implementation of the approved plan;

b) to assign specific tasks to members of the group;

c) to instruct and steer the group members to implement the audit in line with the approved audit plan;

d) to direct and monitor the collection of audit evidences, maintenance of audit diaries and other working documents of the audit groups and the State auditors as provided for by the State Auditor General;

e) to make reports periodically or at the request of the audit team leader on the progress of implementing the audit plan, situation and results of the audit;

f) to synthesize audit results from the members of the group in order to prepare audit minutes; to arrange for discussions within the audit group for a unanimity of the appraisals, certifications, conclusions and recommendations stated in the audit minutes

g) to safeguard the audit results contained in the audit minutes to leader of audit team; to hold for discussions within the group for a unanimity of the certifications, conclusions and recommendations in the audit minutes; to sign the audit minutes;

h) to base himself/herself on the powers authorized by the audit team leader to manage all members of the audit group as regulated by the State Auditor General.

2. The head of audit groups shall have the following powers:

a) to request the audited entities for timely and sufficient provision of information and documents deemed necessary and for explanations of issues relating to the contents of the audit;

b) to request the relevant organisations and individuals to furnish information and documents connecting to the contents of the audit;

c) to reserve in writing his/her opinions which are different from the appraisals, certifications, conclusions and recommendations presented in the audit minutes;

d) to report on and propose for measures to deal with members of the group who commit mistakes in order that the audit team leader may consider and solve according to his/her competence or to propose for a resolution as required by the law;

3. The head of audit group shall have the following responsibilities:

a) to be responsible to the audit team leader for activities of the audit group;

b) to take responsibility to the law for the correctness, integrity, objectivity of the appraisals, certification, conclusion and recommendations in the audit minutes prepared by the audit group.

c) to be accountable for explanations on issues concerning the activities of the audit group as so requested by the audit team leader or by other competent units and individuals;

d) to be subjected to joint liability for offences committed by members of the audit group.

Article 48. Duties, powers of members of audit teams being state auditors

1. Members of the audit team being state auditors shall have the following duties:

a) to complete audit tasks and to report results of his/her carrying out the assigned audit tasks to the head of the audit group;

b) in performing the audit, to abide only by law and current regulations on audit of the State Audit, to conform with the audit principles, standards, procedures and other provisions on audit by the State Auditor General;

c) to gather and evaluate audit evidences; to maintain audit diaries and other working documents of the state auditors; to remain audit profiles as regulated by the State Auditor General;

d) to comply with the directive opinions and conclusions of the head of the audit group and the leader of the audit team;

e) to obey working rules of the audit group and the audit team under applicable provisions by the State Auditor General.

2. Members of audit team being the state auditors shall have powers as follow:

a) in conducting the audit, the State auditors shall be empowered with rights to be independent and to comply only with law whilst making comments, appraisals, conclusions and recommendations on the areas audited;

b) to request the audited entities and organisations and individuals concerned to provide in a timely and sufficient manner information and documents pertaining to the audit contents;

c) to use information and documents of the audit collaborators; to review all documents relating to activities of the audited entities; to gather and safeguard other documents and proofs; to observe the process of operation of the audited entity.

d) to reserve in writing his/her own opinions on the audit results within the designated coverage; to report them to the leader of the audit team or the Chief Auditor for consideration, or to the State Auditor General if still not unanimous.

e) to require the leader of the audit team or head of the audit group to make clear reasons for changing his/her appraisals, certifications, conclusions and recommendations in the audit minutes and audit reports;

f) to request the leader of the audit team or head of the audit group to summon eyewitnesses for gathering necessary audit evidences; to request the audited entity to convene a meeting to explain on the issues relating to the audit; to ask for the participation of experts and audit collaborators if deemed necessary;

g) to be guaranteed with necessary conditions and facilities for performing the audit in an effective manner; to be arranged with working locations in case that the audit is implemented at the audited entity;

h) to be safeguarded by law in the process of executing audit tasks.

Article 49. Tasks and duties of other members of the audit team

1. Other members of the audit team shall include probationary auditors and audit collaborators;

2. Other members of the audit team shall have the following tasks and duties:

a) to fulfill the tasks assigned by the head of the audit group;

b) to comply with the professional standards, procedures and methodologies on audit of the State Audit;

c) to be responsible to the head of the audit group for the assigned tasks.

SECTION 5. AUDIT PROCEDURES

Article 50. Steps of audit procedure

1. the preparation of audit;

2. the implementation of audit;

3. the preparation and submission of audit report;

4. the review of the implementation of audit conclusions and recommendations.

Article 51. Preparation of audit

1. to do survey and collect information on the internal control system, financial situation and other relevant data of the audited entity;

2. to appraise the internal control system and information collected on the audited entity in order to define appropriate objectives, contents, scope of the audit, and the audit methodology as well;

3. to prepare the audit plan.

Article 52. Implementation of audit

1. The audit team shall be required to implement audit of the right audited entity and in line with the objectives, contents, scope, location and time limit of the audit as set forth in the audit decision by the State Auditor General;

2. Members of an audit team shall use audit professional methods to collect and judge audit evidences; to do checks, comparisons and certifications; to investigate organisations and individuals relating to the audit activities to set foundations for forming comments, certifications, conclusions and recommendations on the contents audited;

Article 53. Preparation and submission of the audit report

1. At the end of the audit year and at the end of the audit, the State Audit shall prepare audit reports which shall clearly define possible opinions of appraisals, certifications, conclusions and recommendations about the contents audited;

The audit reports shall be signed and sealed by the State Auditor General or by persons authorised by him.

2. The audit reports shall be of the following forms:

a) the audit report of an audit;

b) the report on audit of the State budget settlement;

c) the annual audit report;

d) the unscheduled audit report.

3. The preparation and submission of the audit reports shall be exercised according to provisions in Articles 54 to 56 of this Law.

Article 54. Preparation and submission of the audit report of an audit

1. Within at most 15 days as from the audit team completes its audit at the audited entity, the audit team leader shall be required to finalize a draft audit report for submission to the Chief Auditor, which shall be laid before the State Auditor General no later than 20 days since the date of completion of the audit at the audited entity;

2. Within at most ten days since the date of receiving the draft audit report, the State General Auditor shall be responsible for organizing for review, completion of the draft audit report and send for feedback comments from the audited entity no later than five days after the draft audit report has been reviewed and completed;

3. Within seven days as from the date of receiving the draft audit report, the audited entity must provide its opinions in writing to the State Audit; beyond this time limit, if the audited entity does not provide any comments thereof, they shall be considered to be unanimous with the draft audit report;

4. The audit report of an audit shall be sent to the audited entity and agencies concerned in compliance with the regulations by the State Auditor General within at most forty five days since the date of completion of the audit at the audited entity; In special cases, it can be extended but not longer than sixty days since the date of completion of the audit at the audited entity.

5. The reports on the audit of the local State budget settlements shall be transmitted to the People's Council and the People's Committee at the same level; as for the reports on the audit of the State budget settlements of provinces and centrally-managed cities, they shall be also sent to the Ministry of Finance.

Article 55. Preparation and submission of the report on the audit of the State budget settlements and the State Audit's annual audit report

1. The report on the audit of the State budget settlements shall be prepared on the basis of the outcomes of auditing the State budget settlements, the results of the audit of the central State budget and local State budget during the year by the State Audit;

2. The annual audit report of the State Audit shall be prepared on the basis of the reports on the audit of the State budget settlements and of the synthesis of the audit results during the year by the State Audit;

3. The State Audit shall be responsible for sending the audit report of the State budget settlements and the annual audit report to the National Assembly, the National Assembly Standing Committee, the Council of Nationalities and other Committees of the National Assembly no later than sixteen months since the end of that budget year, and concurrently to the State President, the Government and the Prime Minister.

Article 56. Preparation and submission of the unscheduled audit reports

Basing on the nature of the audit, the State Audit shall prepare and send the unscheduled audit reports to the National Assembly, the National Assembly Standing Committee, the Council of Nationalities, other Committees of the National Assembly, the State President, the Government and the Prime Minister.

Article 57. Review of the implementation of audit conclusions and recommendations

1. The State Audit shall be required to design plans and organise for the review of the audited entities in term of timely and sufficient implementation of the conclusions, recommendations of the State Audit on errors and mistakes in the financial statements and on legal violations; and of deploying corrective measures on weaknesses in the operation and the results of addressing thereof according to the conclusions of the State Audit.

2. The review of the implementation of the audit conclusions and recommendations shall be carried out in the following forms:

a) to request the audited entities to report in writing on results of implementing the audit conclusions and recommendations;

b) to organise for checking the implementation of the audit conclusions and recommendations at the audited entity and other organisations, agencies and units concerned.

SECTION 6. DISCLOSURE OF AUDIT RESULTS AND RESULTS OF IMPLEMENTING AUDIT CONCLUSIONS AND RECOMMENDATIONS

Article 58. Public disclosure of the annual audit report and report on implementing the audit conclusions and recommendations

1. The annual audit reports and reports on the results of implementing the audit conclusion and recommendation of the State Audit shall be publicized after being submitted to the National Assembly.

2. The State Auditor General shall arrange for disclosing the annual audit reports and reports on the results of implementing the audit conclusions and recommendations by the following means:

a) press conference;

b) announcements on the Public Gazettes and on the mass media;

c) posting on the internet website and other publications of the State Audit.

Article 59. Disclosure of the audit report of an audit

The audit report of an audit, after being published shall be disclosed to the public together with the concerned financial statements as prescribed by the provisions of the State Budget Law and the Law on Accounting.

SECTION 7. AUDIT PROFILE

Article 60. Audit profile

1. The documents relating to audits shall be documented into profiles. The audit profiles shall be comprised of:

a) the audit decision;

b) the financial statements and State budget settlement reports being audited;

c) the audit plan and detailed audit plans;

d) the diaries and working files of the State auditors and audit teams;

e) the explanations by the audited entity;

f) the minutes of confirmation on data and audit situations of the State auditors;

g) the audit minutes;

h) the audit report;

i) other documents relating to the audit.

2. The State Auditor General shall issue detailed regulations on audit profiles.

3. The audit profiles must be placed into archive within 12 months as from the date of issuance of the audit report.

4. The timing for archiving audit profiles shall be at least 20 years, except for cases as regulated in Clause 1, Article 62 of this Law.

Article 61. Maintenance and exploitation of audit profiles

1. The audit profiles shall be maintained in a sufficient, safe and confidential manner.

2. The exploitation of the audit profiles shall be done only in the following cases:

a) as so requested by the courts, procuracies, investigation agencies and other institutions under the provisions of law;

b) as so requested for assessing and checking the audit quality; resolving petitions on the audit reports, or any relevant complaints and denouncements, and for planning the successive audits, and at other requests as specified by the State Auditor General.

Article 62. Destruction of audit profiles

1. The audit profiles which has gone beyond the storage time limit and if there is no otherwise decision by the competent agencies of the State shall be destructed according to the decision by the State Auditor General.

2. The State Auditor General shall make decisions on the establishment of the Council for Destruction of Expired Audit Profiles. The Council shall be required to make reckoning on and to set up a list of the audit profiles to be destructed, and a minutes of destruction.

3. The destruction of the expired audit profiles shall be done by way of burning, cutting or shredding manually or with machine so that the information and data contained in the destructed audit profiles can not be put in use again.

Chapter V

 RIGHTS AND OBLIGATIONS OF THE AUDITED ENTITIES

Article 63. The audited entities

1. Ministries, ministerial-level agencies, Government-affiliated agencies and other agencies at the central level.

2. Institutions assigned with duties of the State budget revenues and expenditures at all levels.

3. People’s councils, people’s committees at all levels and other agencies at the local levels.

4. Units of the people’s armed forces.

5. Units in charge of the reserve funds of the State, branches and levels, and other financial funds of the State.

6. Political organizations, socio-political organizations, political socio-professional organizations as well as social-professional organisations using resources from the State budget.

7. Non-business units totally or partly financed by the State budget.

8. National property management institutions.

9. Management boards of investment projects financed by the State budget or having resources from the State budget.

10. Associations, inter-associations, general associations and other organisations financed partly by the State budget.

11. The State-owned enterprises.

12. Apart from institutions prescribed in Clauses 1 to 11 of this Article, also including the entities subsidized by the State budget, whose liabilities are guaranteed by the State but being not the State-owned enterprises who can hire audit companies to perform audit; the audit businesses shall be required to comply with the state audit standards and procedures and to send audit reports to the State Audit.

Article 64. Rights of the audited entities

1. to request the audit team to present the audit decision, and the state auditors to show the state auditor card.

2. to refuse to provide information, documents not relating to audit contents; to request for substitution of any member of the audit team as there is evident that he/she is impartial during his/her discharging the duties.

3. to discuss and present in writing on the issues contained in the draft audit reports if considered unsatisfied.

4. to complain to the State Auditor General about any acts of the audit team leader, heads of audit groups and other members of the audit team in the process of audit when there is evident that these acts are of legal contradictions.

5. to request the State Audit, the State auditors to compensate for damages if their causing damages to the audited entity according to the provisions of law.

6. to perform other rights as regulated by law.

Article 65. Obligations of the audited entities

1. to abide by the audit decision;

2. to prepare and transmit in an adequate and timely manner the financial statements, investment project consolidated reports, income and expense plans, budget execution and finalisation reports to the State Audit as so requested.

3. to provide in full and on time the information and documents necessary for performing the audit work at the request of the State Audit and the State auditors, and to be responsible to law for the accuracy, integrity and objectivity of the information and documents provided.

4. to answer and explain in an adequate and timely manner any questions raised by the audit team and the State auditors.

5. the leader of the audited entity is required to sign in the audit minutes.

6. to execute in an adequate and timely manner the conclusions and recommendations of the State Audit on errors in the financial statements and on any irregularity concerning legal compliance; to apply measures to improve weakness in operation according to the conclusions and recommendations of the State Audit; to report in writing on the execution of the conclusions and recommendations to the State Audit.

Article 66. Responsibility for submission of the financial statements and budget settlement reports

1. At the end of a budget year, all budget-estimating units level 1 of the central budget, the People's Councils of provinces and centrally-governed cities shall be responsible for sending their financial statements and their budget settlement reports to the Ministry of Finance as so stipulated by the State Budget Law, and concurrently to the State Audit.

2. The Ministry of Finance shall be responsible for sending the State budget consolidated settlement reports to the State Audit within the latest fourteen months since the end of the budget year.

3. The State Treasury shall send periodical reports on the execution of the State budget revenues and expenditures estimates in a quarterly and yearly manner.

Chapter VI

ASSURANCE FOR THE STATE AUDIT OPERATIONS

Article 67. Operational budget of the State Audit

1. The State Audit shall have its own operational budget and be a budget-estimating unit level 1 of the central budget. The budget for the operation of the State Audit shall be upon its estimating and requesting the Government to submit to the National Assembly for decision.

2. The management, allocation and utilisation of the operational budget of the State Audit shall be implemented in compliance with applicable provisions of the legislation on the State budget.

Article 68. Staff members of the State Audit

The total staff members of the State Audit shall be decided by the National Assembly Standing Committee on the proposal of the State Auditor General.

Article 69. Investment for the modernized state audit operations

The State shall have investment policies on the development of the information technology and other facilities to insure for the organisation and operations of the State Audit to meet requirements for international integration.

Article 70. Policies on the officials and public servants of the State Audit

The policies on the salary, subsidies and costumes of the officials and public servants of the State Audit, and other preferential treatments to the State auditors shall be stipulate by the National Assembly Standing Committee.

Article 71. State auditor card

1. The State auditor card shall be issued by the State Auditor General to the State auditors for using during the implementation of their audit tasks.

2. The pattern of the State auditor card and rules on using the State auditor card shall be provided for by the State Auditor General.

Chapter VII

OVERSIGHT OF THE STATE AUDIT OPERATIONS, VIOLATION TREATMENT AND COMPLAINTS AND DENUNCIATIONS RESOLUTION

Article 72. Oversight of the State Audit operations

1. The National Assembly, the National Assembly Standing Committee, the Council of Nationalities, Committees of the National Assembly, missions of the National Assembly deputies, the National Assembly deputies shall be responsible, according to their mandates, duties and powers, for supervising the operation and utilisation of the budget of the State Audit.

2. When deemed necessary, the National Assembly shall set up an Interim Committee to do survey and review on the operation results of the State Audit.

Article 73. Treatment to violations

1. All act of violating the legislation on state audit shall be strictly treated in a timely manner.

2. Investigation agencies, the People's Procuracies, the People's Courts shall be responsible for reviewing the recommendations of the State Audit in order to deal with legal violations within their scope of competence.

Article 74. Resolution of the petitions, complaints and denouncements against the State Audit

1. Within thirty days as from the date of receiving petitions of the audited entity concerning the audit reports, the State Auditor General shall be required to review and resolve thereof. With cases of complexity, the above time limit could be extended, but no longer than forty days since the date of receiving the petitions.

2. The complaint, denunciation about the State audits and the settlement thereof shall be implemented in compliance with the provisions of the law on complaint and denunciation.

Chapter VIII

IMPLEMENTATION PROVISIONS

Article 75. Audit of the national defense and security field

Based on the provisions of this Law, the National Assembly Standing Committee shall prescribe the audit for a number of activities in the national defense-security field.

Article 76. Implementation effect

This Law shall take implementation effect as from the 1st of January, 2006.

This Law was passed by the XI^th National Assembly of the Socialist Republic of Vietnam at its seventh session on the 14th of June, 2005.