Chương 3 Nghị định 105/2013/NĐ-CP: Hành vi vi phạm, hình thức xử phạt và mức xử phạt vi phạm hành chính trong lĩnh vực kiểm toán độc lập

Chapter 3.

VIOLATIONS, SANCTIONING FORMS AND LEVELS OF ADMINISTRATIVE VIOLATIONS IN INDEPENDENT AUDIT

SECTION 1. ACTS VIOLATING PROVISIONS ON GRANT, MANAGEMENT AND USE OF CERTIFICATES OF ELIGIBILITY FOR PROVIDING AUDIT SERVICE

Article 18. Sanction of act violating provision on dossier requesting for grant of certificates of eligibility for providing audit service

1. A warning shall be imposed for individuals, legal representatives of audit organizations, and audit organizations that implement any of following violations so as to be eligible for grant of certificates of eligibility for providing audit service:

a) To make untrue statement in dossier requesting for grant of certificates of eligibility for providing audit service;

b) To forge, make false statement in dossier requesting for grant of certificates of eligibility for providing audit service;

c) To certify on documents which are untrue, documents forged or falsified in dossier requesting for grant of certificates of eligibility for providing audit service;

2. Remedial measures: Forcible destruction of all documents already declared which are untrue, forged, falsified.

Article 19. Sanction of acts violating provisions on management and use of certificates of eligibility for providing audit service

1. A warning shall be imposed for audit organization which fails to submit certificate of eligibility for providing audit service to the Ministry of Finance when there is a decision on withdrawal, unless otherwise prescribed by law.

2. A fine of between VND 10,000,000 and 20,000,000 shall be imposed for audit organizations which fail to do procedures for adjusting certificates of eligibility for providing audit service when arising changes having to be adjusted as prescribed by law.

3. Deprive of right to use of certificates of eligibility for providing audit service for a period of between 12 months and 24 months, for audit organizations conducting any of following violations:

a) To forge, erase, modify certificates of eligibility for providing audit service;

b) To lease, lend certificates of eligibility for providing audit service;

4. Remedial measures:

a) Forcible destruction of certificates of eligibility for providing audit service which have been forged, erased, modified;

b) Forcible remittance of illicit earnings from the commission of administrative violations specified in point b Clause 3 of this Article.

SECTION 2. ACTS VIOLATING PROVISIONS ON OPERATION OF AUDIT ENTERPRISES, FOREIGN AUDIT ENTERPRISES’ BRANCHES IN VIETNAM

Article 20. Sanction of acts violating provisions on providing audit service of audit enterprises

1. A fine of between VND 10,000,000 and 20,000,000 shall be imposed for organizations which are not granted certificates of eligibility for providing audit service but fail to do procedures for deleting trade of audit service in the certificate of enterprise registration, or certificate of business registration, or certificate of investment within 6 months from the nearest day of changing business registration.

2. A fine of between VND 20,000,000 and 30,000,000 shall be imposed for organizations which are not eligible for providing audit service in accordance with regulation but use phrase of “audit” in their name.

3. A fine of between VND 40,000,000 and 50,000,000 shall be imposed for organizations providing audit service while they have not yet been granted certificates of eligibility for providing audit service.

4. A fine of between VND 40,000,000 and 50,000,000 shall be imposed for audit organizations which still continue providing services as prescribed in Clause 1 Article 40 of the Law on Independent Audit after they have been revoked certificates of eligibility for providing audit service.

5. Remedial measures: Forcible remittance of illicit earnings from the commission of administrative violations specified in Clause 3, Clause 4 of this Article.

Article 21. Sanction of acts violating provisions on suspension of providing audit service

1. Deprive of right to use of certificates of eligibility for providing audit service for a period of between 12 months and 24 months shall be imposed for audit organizations which still continue providing services as prescribed in Clause 1 Article 40 of the Law on Independent Audit after they have been suspended provision of audit service.

2. Remedial measures: Forcible remittance of illicit earnings from the commission of administrative violations specified in Clause 1 of this Article.

SECTION 3. ACTS VIOLATING PROVISIONS ON MANAGEMENT AND USE OF CERTIFICATES OF AUDITORS, UPDATING OF KNOWLEDGE FOR AUDITOR

Article 22. Sanction of acts violating provisions on dossier of participating in exam and participation in auditor examination

1. A warning or fine of between VND 500,000 and 1,000,000 shall be imposed for individuals forging, making false statement about diplomas, certificates and other documents in their dossiers so as to be eligible for participating in exam to obtain certificates of auditor.

2. A fine of between VND 3.000,000 and 5,000,000 shall be imposed for organizations certified inconsistently with reality about documents in dossier so as to be eligible for participating in exam to obtain certificates of auditor.

3. A fine of between VND 10,000,000 and 20,000,000 shall be imposed for individuals conducting one of the following violations:

a) To let other person taking in exam under their name to obtain certificates of auditor;

b) To taking in exam under name of other person in exam to obtain certificates of auditor;

4. Remedial measures:

a) Forcible destruction of all documents, diplomas, or certificates forged, with false statements in dossier of taking in exam to obtain certificate of auditor for violation specified in clause 1 of this Article;

b) Forcible remittance of illicit earnings from the commission of administrative violations specified in point b Clause 3 of this Article.

Article 23. Sanction of acts violating provisions on management and use of certificates of auditors

1. A fine of between VND 20,000,000 and 30,000,000 shall be imposed for auditors conducting one of the following violations:

a) To forge, erase, modify certificates of auditor;

b) Let organizations, or individuals other than units where they are working to hire, borrow or use their certificates of auditor so as to perform the professional operations of accounting and independent audit.

2. A fine of between VND 40,000,000 and 50,000,000 shall be imposed for organizations hiring, borrowing or using certificates of auditor of persons not working at their units so as to perform the professional operations of accounting and independent audit.

3. Remedial measures:

a) Forcible destruction of all forged, erased, modified documents for acts of violation specified in point a Clause 1 of this Article;

b) Forcible remittance of illicit earnings from the commission of administrative violations specified in point b Clause 1 of this Article.

Article 24. Sanction of acts violating provisions on updating of knowledge for auditor

1. A warning shall be imposed for organizations which have been approved by the Ministry of Finance for organizing courses of updating knowledge for auditor, audit enterprises which have been approved by the Ministry of Finance for self- organizing courses of updating knowledge for auditor serving auditors of their enterprises (referred to as organizations) conducting one of following violations:

a) Reporting improperly the prescribed deadline about results of organizing courses of updating knowledge for auditor;

b) Failing to monitor, call the roll of auditors who participating in courses of updating;

c) Failing to collect assessment opinions of trainees on the slips for assessing quality of courses of updating knowledge for auditor;

d) Failing to issue certificates for auditors who have participated in courses of updating knowledge.

2. A fine of between VND 5,000,000 and 10,000,000 shall be imposed for units, organizations updating knowledge for auditor without approval of the Ministry of Finance.

3. Suspension of organization to update knowledge for auditor for a period of between 03 months and 06 months, from the effective day of decision on sanction for organizations conducting any of following violations:

a) Organizing the updating knowledge for auditor improperly with content, program already registered with the Ministry of Finance;

b) Arranging lecturers in charge of class of updating knowledge for auditor who fail to meet conditions in accordance with regulation;

c) Failing to report results of organizing courses of updating knowledge for auditor in accordance with regulation;

d) Reporting inaccurate quantity of auditors who have participated in courses of updating knowledge;

dd) Reporting inaccurate number of hours for updating knowledge of auditors;

e) Issuing certificates of participation in courses of updating knowledge for auditors who practically fail to participate in courses of updating knowledge;

g) Failing to store fully dossiers of organizing courses of updating knowledge for auditor in accordance with regulation.

4. Remedial measures: Forcible remittance of illicit earnings from the commission of administrative violations specified in Clause 2 of this Article.

SECTION 4. ACTS VIOLATING PROVISIONS ON REGISTRATION FOR AUDIT PRACTICE AND CERTIFICATES OF AUDIT PRACTICE REGISTRATION

Article 25. Sanction of acts violating provisions on dossier of registration for audit practice of auditors

1. A warning shall be imposed for individuals conducting one of the following violations:

a) Making untrue statements in dossier so as to be eligible for grant of certificate of audit practice registration;

b) Forging, making false statements about diplomas, certificates in dossier so as to be eligible for grant of certificate of audit practice registration;

c) Certifying dishonestly documents in dossier so as to be eligible for grant of certificate of audit practice registration.

2. A warning shall be imposed for organizations conducting act of certifying dishonestly information, documents in dossier so as to be eligible for grant of certificate of audit practice registration.

3. Remedial measures: Forcible destruction of all documents already declared and certified dishonestly, forged, falsified.

Article 26. Sanction of acts violating provisions on management and use of certificates of audit practice registration

1. A warning shall be imposed for organizations, individuals who fail to return certificates of audit practice registration to the Ministry of Finance in accordance with regulation.

2. A fine of between VND 10,000,000 and 20,000,000 shall be imposed for individuals using certificates of audit practice registration which had been invalidated so as to perform the professional operations of accounting and independent audit.

3. A fine of between VND 20,000,000 and 30,000,000 shall be imposed for auditors who let organizations or individuals other than their units where they are working, renting, borrowing or using their certificates of audit practice registration so as to perform the professional operations of accounting and independent audit.

4. A fine of between VND 40,000,000 and 50,000,000 shall be imposed for organizations conducting one of the following violations:

a) Forging, erasing, modifying certificates of audit practice registration;

b) Using certificates of audit practice registration which had been invalidated so as to perform the professional operations of accounting and independent audit.

5. Deprive of right to use of certificates of eligibility for providing audit service for a period of between 12 months and 24 months, for audit organizations which hired, borrowed, or used certificates of audit practice registration of auditors who are not working in their units to perform the professional operations of accounting and independent audit.

6. Remedial measures:

a) Forcible remittance of illicit earnings from the commission of administrative violations specified in Clause 2, Clause 3, Clause 4 of this Article;

b) Forcible destruction of forged certificates of audit practice registration, for organizations conducting violation specified in point a Clause 4 of this Article.

SECTION 5. ACTS VIOLATING PROVISIONS ON AUDIT OPERATION

Article 27. Sanction of acts violating provisions on buying occupational liability insurance for the professional-practicing auditors or setting up of provision fund for occupational risks

1. A warning or fine of between VND 500,000 and 1,000,000 shall be imposed for audit organizations which have bought occupational liability insurance for the professional-practicing auditors or set up of provision fund for occupational risks inconsistently with regulations of the Ministry of Finance.

2. A fine of between VND 5,000,000 and 10,000,000 shall be imposed for audit organizations which fail to buy occupational liability insurance for the professional-practicing auditors or set up of provision fund for occupational risks.

Article 28. Sanction of acts violating provisions on acceptance for providing audit service

1. A fine of between VND 10,000,000 and 20,000,000 shall be imposed for audit organizations agreed provision of audit service for clients when clients have requests in contrary to occupational ethics, specialized or professional requirements, or in contrary to law.

2. Remedial measures: Forcible remittance of illicit earnings from the commission of administrative violations specified in Clause 1 of this Article.

Article 29. Sanction of acts violating provisions on audit contract

1. A warning shall be imposed for audit organizations signing audit contracts with clients, units subject to audit with insufficient contents in accordance with regulation when providing audit service for clients units subject to audit.

2. A fine of between VND 5,000,000 and VND 10,000,000 for audit organizations and clients failing to conclude audit contract before auditing.

3. A fine of between VND 10,000,000 and VND 20,000,000 for audit organizations failing to conclude audit contract with clients before providing audit service.

Article 30. Sanction of acts violating provisions on confidentiality

1. A fine of between VND 5,000,000 and 10,000,000 shall be imposed for individuals disclosing information related to audit dossier, clients and units subject to audit, unless clients and units subject to audit agreed or otherwise provided by law.

2. A fine of between VND 10,000,000 and VND 20,000,000 shall be imposed for audit organizations which fail to formulate and operate the system of internal control with the aim to ensure implementation of obligation on confidentiality.

3. Suspension of audit practice for a period of between 03 months and 06 months, from the effective day of decision on sanction, for the professional-practicing auditors who use information related to audit dossier, clients, units subject to audit so as to infringe benefits of state, public interests, rights and lawful benefits of agencies, organizations, individuals.

4. Suspension of providing audit service for a period of between 03 months and 06 months, from the effective day of decision on sanction, for the audit organizations which use information related to audit dossier, clients, units subject to audit so as to infringe benefits of state, public interests, rights and lawful benefits of agencies, organizations, individuals.

5. Remedial measures: Forcible remittance of illicit earnings from the commission of administrative violations specified in Clause 1 of this Article.

Article 31. Sanction of acts violating provisions on audit report

1. A fine of between VND 5,000,000 and 10,000,000 shall be imposed for the professional-practicing auditors who conduct one of the following violations:

a) Signing on audit reports improperly with competence according to regulations;

b) Signing audit reports before day of signing the audited financial statements.

2. A fine of between VND 5,000,000 and VND 10,000,000 shall be imposed for individuals who sign on audit reports when they are not the professional-practicing auditors.

3. A fine of between VND 10,000,000 and 20,000,000 shall be imposed for audit organizations conducting one of the following violations:

a) Arranging the professional-practicing auditors for signing on audit reports improperly with competence according to regulations;

b) Issuing audit reports of which day of signing is prior day of signing the financial statements;

c) Making audit reports which are lack signatures of the professional-practicing auditors according to regulations;

d) Failing to make explanations, or make explanations insufficiently, untimely about the excluded contents at requests of competent agencies, representatives of owners of units subject to audit.

4. Suspension of audit practice for a period of between 03 months and 06 months, from the effective day of decision on sanction, for the professional-practicing auditors who conduct any of following violations:

a) Signing on audit reports for more than three consecutive years for an audited unit;

b) Signing the audit reports after certificates of audit practice registration are invalid or ineffective.

5. Suspension of business in audit service for a period of between 03 months and 06 months, from the effective day of decision on sanction, for the audit organizations which conduct any of following violations:

a) Arranging the person to sign on audit reports who is not a practicing auditor;

b) Arranging an practicing auditor to sign audit reports for more than three consecutive years for an audited unit;

c) Arranging a practicing auditor to sign audit reports after certificate of audit practice registration is invalid or ineffective.

SECTION 6. ACTS VIOLATING PROVISIONS ON INDEPENDENCE

Article 32. Sanction of acts violating provisions on independence of members participating in an audit

1. A warning shall be imposed for members participating in an audit and conducting one of the following violations:

a) Providing untrue information, introducing wrongly about qualification, experiences, and capability of service provision of the professional-practicing auditors and audit enterprises, foreign audit enterprises’ branches in Vietnam;

b) Vying the clients under forms of obstruction, enticement, bribe, collusion with clients and other unfair competitive acts.

2. A fine of between VND 10,000,000 and 20,000,000 shall be imposed for members participating in an audit and conducting one of the following violations:

a) Buying, accepting donations of, holding shares or contributed capitals of the audited unit regardless of quantity;

b) Buying, selling bonds or other assets of the audited unit causing effect to independence according to regulations on standards of occupational ethics in accounting and audit;

c) Accepting or requesting any of amount or benefit from the audited unit excluded service charges and costs agreed in the concluded contract;

d) Harassing or deceiving clients, units audited;

dd) Interfering the business operation of clients, units audited in the audit course.

3. A fine of between VND 20,000,000 and 30,000,000 shall be imposed for the professional-practicing auditors who conduct one of the following violations:

a) Auditing for clients while failing to ensure independence, insufficient professional capability, not eligible according to regulations of law;

b) Auditing for clients when clients have requests in contrary to occupational ethics, specialized or professional requirements, or in contrary to law.

4. Suspension of audit practice for a period of between 06 months and 12 months, from the effective day of decision on sanction, for the professional-practicing auditors who conduct any of following violations:

a) Colluding, binding with the audited unit to falsify accounting documents, financial statements, audit dossier and reporting falsely audit results;

b) Forging or making false statements in audit dossiers;

5. Deprive of right to use certificate of audit practice registration for a period of between 12 months and 24 months, from the effective day of decision on sanction, for the professional-practicing auditors who conduct any of following violations:

a) Practicing audit under a personal capacity;

b) Working for more than two audit enterprises, foreign audit enterprises’ branches in Vietnam in the same time;

c) Contributing capital in more than two audit enterprises.

6. Remedial measures: Forcible remittance of illicit earnings from the commission of administrative violations specified in Clause 2, Clause 3, Clause 4 of this Article;

Article 33. Sanction of acts violating provisions on independence of audit organization

1. A warning shall be imposed for audit organizations conducting one of the following violations:

a) Providing untrue information, introducing wrongly about qualification, experiences, and capability of service provision of the professional-practicing auditors, audit organization, foreign audit enterprises’ branches in Vietnam;

b) Vying the clients under forms of obstruction, enticement, bribe, collusion with clients and other unfair competitive acts.

2. A fine of between VND 20,000,000 and 40,000,000 shall be imposed for audit organizations conducting one of the following violations:

a) Buying, accepting donations of, holding shares or contributed capitals of the audited unit regardless of quantity;

b) Buying, selling bonds or other assets of the audited unit causing effect to independence according to regulations on standards of occupational ethics in accounting and audit;

c) Accepting or requesting any of amount or benefit from the audited unit excluded service charges and costs agreed in the concluded contract;

d) Harassing or deceiving clients, units audited;

dd) Interfering the business operation of clients, units audited in the audit course.

e) To perform collection of debts on behalf of the audited units.

3. Suspension of business in audit service for a period of between 06 months and 12 months, from the effective day of decision on sanction, for the audit organizations which conduct any of following violations:

a) Colluding, binding with the audited unit to falsify accounting documents, financial statements, audit dossier and reporting falsely audit results;

b) Forging or making false statements in audit dossiers;

c) Conducting audit when fall in one of cases banned providing audit service according to law.

4. Remedial measures: Forcible remittance of illicit earnings from the commission of administrative violations specified in Clause 2, Clause 3 of this Article.

SECTION 7. ACTS VIOLATING PROVISIONS ON THE AUDITED UNITS

Article 34. Sanction of acts violating provisions on selecting audit organization, the professional-practicing auditors for audit implementation

1. A fine of between VND 20,000,000 and VND 30,000,000 for the audited units which hire audit organizations falling in cases of audit organizations banned providing audit service according to law.

2. A fine of between VND 30,000,000 and VND 40,000,000 for the audited units which hire audit organizations not eligible for providing audit service according to law.

3. A fine of between VND 40,000,000 and VND 50,000,000 for the audited units which fail to implement compulsory audit for financial statements, settlement reports of finished projects, the consolidated financial statements, the sum financial statements and other audit contents according to law on independent audit and other relevant laws.

Article 35. Sanction of acts violating provisions on conclusion of contract for auditing annual financial statement

1. A warning shall be imposed for enterprises, organizations being compulsory subjects to have to audit annual financial statements contracting for auditing the financial statements with insufficient content according to regulations.

2. A fine of between VND 10,000,000 and 20,000,000 shall be imposed for enterprises, organizations conducting one of the following violations:

a) Enterprises, organizations being compulsory subjects to have to audit annual financial statements contracting for auditing the financial statements later than the prescribed deadline;

b) Enterprises, organizations failing to conclude the audit contracts before auditing.

3. A fine of between VND 20,000,000 and 30,000,000 shall be imposed for enterprises, organizations being compulsory subjects to have to audit annual financial statements failing to conclude contracts for auditing the financial statements according to regulations.

Article 36. Sanction of acts violating provisions related to the audit

1. A warning shall be imposed for individuals, organizations refusing or failing to provide sufficiently, exactly, honestly, timely, objectively the necessary information, documents at the request of the professional-practicing auditors or audit organizations involving the audit.

2. A fine of between VND 10,000,000 and 20,000,000 shall be imposed for the audited units which fail to make explanations, or make explanations insufficiently and untimely about the excluded contents in audit reports at requests of competent agencies.

3. A fine of between VND 20,000,000 and 30,000,000 shall be imposed for organizations conducting one of the following violations:

a) Bribing, colluding with members participating in the audit, and audit organizations to falsify accounting documents, financial statements, audit dossier and audit reports;

b) Threatening, retaliating, coercing members participating in the audit with the aim to falsify the audit result.

c) Hiding violations on finance, accounting;

d) Interfering work and having acts to limit the scope of audit.

4. Remedial measures: Forcible correction of untrue information, information causing mistake, for violations specified at Points a and b, Clause 3 of this Article;

Article 37. Sanction of acts violating provisions on auditing the settlement report of finished projects

A fine of between VND 30,000,000 and 40,000,000 shall be imposed for enterprises, organizations implementing the national important projects, group-A projects funded by state capital, except for projects under state secret according to law, not required to perform audit for settlement reports of the finished projects.

SECTION 8. ACTS VIOLATING PROVISIONS ON AUDIT DOSSIERS

Article 38. Sanction of acts violating provisions on making audit dossiers

1. Suspension of audit practice for a period of between 06 months and 12 months, from the effective day of decision on sanction, for the professional-practicing auditors who fail to make the audit dossier for an audit.

2. Suspension of business in audit service for a period of between 06 months and 12 months, from the effective day of decision on sanction, for the audit organizations failing to make the audit dossier for an audit.

Article 39. Sanction of acts violating provisions on preservation and archival of audit dossiers

A fine of between VND 5,000,000 and 10,000,000 shall be imposed for audit organizations conducting one of the following violations:

1. Preserving, storing the audit dossiers insufficiently, unsafely, and causing damage, loss to the audit dossiers in the course of using and in time limit of archival.

2. Putting the audit dossiers into archival later than 12 months from the day of issuing the audit report of an audit.

3. Failing to store the audit dossier made of paper or electronic data.

4. Failing to design, implement the policies and procedures to maintain the confidentiality, safety, entire, ability of accessing and restoring of audit dossiers according to regulations on audit standards.

5. Failing to design, implement the policies and procedures on archival of audit dossiers in the minimum duration of 10 years from the day of issuing audit report of an audit according to regulations on audit standards.

Article 40. Sanction of acts violating provisions on destruction of audit dossiers

1. A fine of between VND 10,000,000 and 20,000,000 shall be imposed for audit organizations conducting one of the following violations:

a) Deciding on destruction of audit dossiers improperly with competence;

b) Destroying audit dossiers without setting up a destruction council, without strictly observing the method of destruction and without making destruction minutes according to regulations.

2. A fine of between VND 20,000,000 and VND 30,000,000 shall be imposed for the audit organizations implementing destruction of audit dossiers which are in time limit of archival according to regulation or deliberately damaging to the audit dossiers.

SECTION 9. ACTS VIOLATING PROVISIONS ON AUDITING FINANCIAL STATEMENTS OF UNITS WITH PUBLIC BENIFITS

Article 41. Sanction of acts violating provisions on providing audit or control services for units with public interests

1. A fine of between VND 40,000,000 and VND 50,000,000 shall be imposed for units with public interests which select audit organizations providing audit service or control service while those audit organizations have not yet been approved by the Ministry of Finance or been suspended, cancelled the accepted status.

2. Suspension of audit practice for a period of between 06 months and 12 months, from the effective day of decision on sanction, for the professional-practicing auditors who audit, sign on audit reports or result reports on control work for units with public interests when have not yet accepted by the Ministry of Finance or when have been suspended or cancelled the accepted status.

3. Suspension of business in audit service for a period of between 06 months and 12 months, from the effective day of decision on sanction, for the audit organizations which provide audit service or control service for units with public interests when have not yet accepted by the Ministry of Finance or when have been suspended or cancelled the accepted status.

4. Remedial measures: Forcible remittance of illicit earnings from the commission of administrative violations specified in Clause 1, Clause 2, Clause 3 of this Article.

Article 42. Sanction of acts violating provisions on disclosure of transparency reports

1. A warning shall be imposed for audit organizations conducting one of the following violations:

a) Failing to disclosure and update full information in transparency report on their websites according to regulations;

b) The transparency report has no signature of legal representative of audit organization or authorized person when announcing;

c) Disclosing information in the transparency report later than 90 days in comparison with deadline from the ending day of financial year.

2. A fine of between VND 5,000,000 and 10,000,000 shall be imposed for audit organizations conducting one of the following violations:

a) Failing to make website according to regulations;

b) Disclosing false information in transparency report.

3. Remedial measures: Forcible correction of false information announced.

Article 43. Sanction of acts violating provisions on dossier of registration for participation in audit for units with public interests

1. A fine of between VND 5,000,000 and VND 10,000,000 for individuals and audit organizations conducting one of the following violations in order to accept audit for units with public interests:

a) To make untrue statements in dossier requesting for acceptance of audit for units with public interests;

b) To forge, make false statements in dossier requesting for acceptance of audit for units with public interests;

c) To certify on untrue documents, forged documents, documents of false statements in dossier requesting for acceptance of audit for units with public interests.

2. Remedial measures: Forcible remittance of illicit earnings from the commission of administrative violations specified in Clause 1 of this Article.

Article 44. Sanction of acts violating provisions related to the responsibilities of units with public interests

A fine of between VND 10,000,000 and 20,000,000 shall be imposed for units with public interests conducting one of the following violations:

1. Failing to formulate and operate the system of internal control.

2. Failing to organize the internal audit as prescribed by law;

Article 45. Sanctions of acts violating provisions on independence

1. A fine of VND 5,000,000 and 10,000,000 shall be imposed for individuals who have performed audit for units with public interest, at present time, hold positions of management, administration, member of control board, chief accountant of those units with public interests, and duration from the day of ending audit to the day of holding such positions is less than twelve months.

2. A fine of between VND 20,000,000 and VND 40,000,000 shall be imposed for units with public interests accepting the professional-practicing auditors who have performed audit of financial statements in 5 consecutive financial years.

3. Suspension of audit practice for a period of between 03 months and 06 months, from the effective day of decision on sanction, for the professional-practicing auditors who have made audit for units with public interests for 5 consecutive financial years.

4. Suspension of business in audit service for a period of between 03 months and 06 months, from the effective day of decision on sanction, for the audit organizations arranging the professional-practicing auditors who have performed audit of financial statements for one unit with public interests for 5 consecutive financial years.

SECTION 10. ACTS VIOLATING PROVISIONS ON SUPPLY AND USE OF THROUGH-BORDER AUDIT SERVICE

Article 46. Sanction of acts violating provision on conditions for supply of through-border audit service

Suspension of providing through-border audit service in Vietnam for 24 months from the effective day of sanction decision, for foreign audit enterprises conducting one of the following violations:

1. Supplying through-border audit service in Vietnam when have not yet registered with the Ministry of Finance of Vietnam in order to be granted certificate of eligibility for business in through-border audit service in Vietnam.

2. Supplying the through-border audit service when failing to maintain fully one of conditions according to regulations.

3. Forging, erasing, or modifying dossier requesting for registration of supplying the through-border audit service.

Article 47. Sanction of acts violating provisions applicable to enterprises, organizations involving use of through-border audit service

A fine of between VND 20,000,000 and 30,000,000 shall be imposed for enterprises, organizations paying and transferring money involving supply of through-border audit service not in form of money transfer through allowed credit institutions as prescribed by law on foreign exchange of Vietnam.

Article 48. Sanction of acts violating provision on form of supplying service through borders

Suspension of supply of through-border audit service in Vietnam for a period of between 12 months and 24 months, from the effective day of sanction decision, for foreign audit enterprises, suspension of business in audit service for a period of between 06 months and 12 months, form the effective day of sanction decide for audit enterprises in Vietnam conducting one of the following violations:

1. Failing to enter into partnership with audit enterprises in Vietnam which are eligible to supply the audit service when supplying the through-border audit service.

2. Entering into partnership with audit enterprises in Vietnam which are not eligible to supply the audit service when supplying the through-border audit service.

3. Entering into partnership with foreign audit enterprises in order to supply the through-border service when do not ensure fully conditions for trading in audit service as prescribed.

4. Failing to enter into an audit contract as prescribed by Vietnamese law when supplying the through-border audit service.

5. The audit contracts involving supply of through-border audit service have no full signatures of legal representatives of foreign audit enterprises, audit enterprises in Vietnam and units subject to audit.

6. Failing to make a partnership contract involving supply of through-border audit service according to regulations.

7. The partnership contracts fail to clearly divide duties of foreign audit enterprises and Vietnamese enterprises in supply of the through-border audit service.

8. Failing to assign the professional-practicing auditors in charge of audit work parts under duties of each party according to regulations.

9. The audit reports have no signatures of the legal representatives of foreign audit enterprises, Vietnamese audit enterprises and the professional-practicing auditors in charge of the audit work part under duty of each enterprise in co-auditing contracts.

10. The audit contracts, partnership contracts, audit dossiers and audit reports are not made concurrently in both of languages of Vietnamese and English.

Article 49. Sanction of acts violating provision on obligations of enterprises supplying the through-border audit service

1. A fine of between VND 40,000,000 and 50,000,000 shall be imposed for foreign audit enterprises conducting one of the following violations:

a) Failing to submit financial statements of the preceding year according to regulations or failing to submit properly with deadline;

b) Reporting untimely, insufficiently according to the set form on situation of performing contracts of supplying the through-border audit service arisen in Vietnam;

c) Failing to perform other obligations of audit enterprises according to provisions in the Law on Independent Audit of Vietnam.

2. Suspension of supply of through-border audit service in Vietnam for a period of between 12 months and 24 months, from the effective day of sanction decision, for foreign audit enterprises conducting one of the following violations:

a) Violating the prohibited acts, cases banned performing audit as prescribed in the Law on Independent Audit of Vietnam;

b) Failing to abide by the Vietnamese audit standards when supply the through-border audit service in Vietnam;

c) Failing to report or reporting untruthfully on situation of performing contracts of supplying the through-border audit services arisen in Vietnam;

d) Failing to assign the responsible persons representing enterprises to report, make explanations for functional agencies of Vietnam related to audit contracts, audit dossiers, audit reports and other matters involving supply of the through-border services in Vietnam.

Article 50. Sanction of acts violating provision on partnership in supply of the through-border audit service

Suspension of supply of audit service for a period of between 06 months and 12 months, from the effective day of sanction decision, for Vietnamese audit enterprises which enter into partnership with the foreign audit enterprises to conduct one of the following violations:

1. Failing to store all audit dossiers of the audit already been performed under partnership form.

2. Failing to supply or supply insufficiently, untimely the audit dossiers of the audit already performed under partnership form for functional agencies as being requested.

3. Failing to make explanations or making explanations insufficiently and untimely to functional agencies about the audit reports, audit dossiers and matters arising from the audit under form of partnership with foreign audit enterprises.

4. Failing to perform report on situation of performing partnership with foreign audit enterprises in supply of the through-border audit service according to regulation.

5. Failing to coordinate with the competent agencies in control of audit service quality for partnership contracts with foreign audit enterprises.

SECTION 11. ACTS VIOLATING PROVISIONS ON NOTICE AND REPORT

Article 51. Sanction of acts violating provisions on obligations in notice and report of audit organizations

1. A warning shall be imposed for audit enterprises failing to notify the Ministry of Finance in writing and enclosed copies of documents, about establishment or operational termination of facilities of overseas audit enterprises.

2. A fine of between VND 2,000,000 and 3,000,000 shall be imposed for audit enterprises, branches of audit enterprises notifying the Ministry of Finance later than the prescribed time limit when having changes about:

a) List of the professional-practicing auditors;

b) Name, address of head office of enterprises;

c) Name, address of head office of branches trading in audit service;

d) Temporarily stopping the audit service business operation;

dd) The operational termination of branches trading in audit service;

e) Annual reports on operational situation and irregular reports at the request of the Ministry of Finance.

3. A fine of between VND 3,000,000 and 5,000,000 shall be imposed for audit enterprises, branches of audit enterprises failing to notify the Ministry of Finance when having changes about:

a) List of the professional-practicing auditors;

b) Name, address of head office of enterprises;

c) Name, address of head office of branches trading in audit service;

d) Temporarily stopping the audit service business operation;

dd) The operational termination of branches trading in audit service;

e) Annual reports on operational situation and irregular reports at the request of the Ministry of Finance.

4. A fine of between VND 5,000,000 and 10,000,000 shall be imposed for audit enterprises, branches of audit enterprises notifying the Ministry of Finance later than the prescribed time limit when:

a) Failing to ensure one of conditions specified in Article 21 and Article 31 of the Law on Independent Audit, and Articles 5, 6, 7, 8 of Government’s Decree No. 17/2012/ND-CP, dated March 13, 2012, detailing and guiding implementation of a number of articles of the Law on Independent Audit;

b) Changing Directors, or General Directors, legal representatives, the contribution capital rate of members;

c) Performing the division, separation, merger, consolidation, transform, or dissolution.

5. Suspension of trading in audit service for a period of 12 months, from the effective day of sanction decision, for audit enterprises, branches of audit enterprises which fail to notify the Ministry of Finance when: a) Failing to ensure one of conditions specified in Article 21 and Article 31 of the Law on Independent Audit, and Articles 5, 6, 7, 8 of Government’s Decree No. 17/2012/ND-CP, dated March 13, 2012, detailing and guiding implementation of a number of articles of the Law on Independent Audit;

b) Changing Directors, or General Directors, legal representatives, the contribution capital rate of members;

c) Performing the division, separation, merger, consolidation, transform, or dissolution.

Article 52. Sanction of acts violating provisions on obligations in notice and report of the professional-practicing auditors

1. A warning shall be imposed for the professional-practicing auditors performing notices or periodical or irregular reports to the Ministry of Finance in time later than the prescribed time limit when:

a) No longer working in audit enterprises, branches of foreign audit enterprises in Vietnam as stated in certificate of registration for audit practice;

b) The full-time labor contract at audit enterprises, branches of foreign audit enterprises in Vietnam is expired or terminated or has changes which result not to ensure for it still be a full-time labor contract according to regulations;

c) Labor permits in Vietnam of the foreign professional-practicing auditors are expired or invalid;

d) Participating with personal status to do as Chief accountant (or person in charge of accounting), the internal accounting, audit officers, or other positions at units, organizations other than audit organizations.

2. A fine of between VND 5,000,000 and 10,000,000 shall be imposed for the professional-practicing auditors failing to notify or notify later than over 15 days in comparison with regulation when:

a) No longer working in audit enterprises, branches of foreign audit enterprises in Vietnam as stated in certificate of registration for audit practice;

b) The full-time labor contract at audit enterprises, branches of foreign audit enterprises in Vietnam is expired or terminated or has changes which result not to ensure for it still be a full-time labor contract according to regulations;

c) Labor permits in Vietnam of the foreign professional-practicing auditors are expired or invalid;

d) Participating to do as Chief accountant (or person in charge of accounting), the internal accounting, audit officers, or other positions at units, organizations other than audit organizations.

SECTION 12. ACTS VIOLATING PROVISIONS ON QUALITY CONTROL OF AUDIT SERVICE

Article 53. Sanction of acts violating provisions on quality control of audit service of audit organizations

A fine of between VND 20,000,000 and 30,000,000 shall be imposed for audit organizations conducting one of the following violations:

1. Failing to formulate the system of service quality control for audit service, control service of financial statements, financial information and other guarantee services.

2. Failing to formulate policies and procedures for quality control over each audit.

3. Failing to control the service quality for audit service, control service of financial statements, financial information and other guarantee services.

4. Failing to perform policies and procedures for quality control over each audit.

5. Failing to supply or supply insufficiently, untimely information, documents at the request of competent agencies and organizations in the course of audit quality control.

6. Supplying the inaccuracy, untruthful information, documents to the competent agencies and organizations in the course of audit quality control.

7. Failing to make explanations, cooperate with the competent agencies and organizations in the course of audit quality control.

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