What is the time limit from completion of a financial year for enterprises in Vietnam to submit annual audit reports?

What is the time limit from completion of a financial year for enterprises in Vietnam to submit annual audit reports?

Pursuant to Article 16 of the Decree 05/2019/NĐ-CP stipulating audit reports as follows:

1. Internal audit reports of audited units must be prepared, completed and submitted to:

a) Ministers, Heads of Ministry-level agencies, Heads of Governmental bodies in case of auditing of Ministries, Ministry-level agencies and Governmental bodies;

b) People’s Committees of centrally-affiliated cities and provinces in case of auditing of People’s Committees of centrally-affiliated cities and provinces;

c) Heads of state-owned public service units in case of auditing of state-owned public service units;

d) Management Boards, Members’ Boards, Presidents of enterprises, Control Boards or Directors General (Directors) in case of auditing of enterprises;

dd) Other departments under internal audit rules of each audited unit.

2. An internal audit report must clarify: Audited matters, audit extent; opinions and conclusions related to audited matters and bases for giving such opinions and conclusions; weaknesses, unresolved issues, defaults, defects, violations and recommended actions against errors, defects and violations; recommended measures for rationalization and improvement of auditing processes; perfection of policies on management of risks and organizational structure of each audited unit (if any).

3. Internal audit reports must have opinions from leaderships of departments/units subject to internal audits. In case where audited departments/units have contentious opinions on audit results, internal audit reports shall need to clarify contentious opinions of audited departments/units and reasons.

4. Internal audit reports must bear signatures of the Head or Leader of the audit group or commission or the person in charge of the internal audit. In case of hiring of independent bodies rendering internal audit services, audit reports must carry signatures of the legal representatives or authorized persons as a minimum requirement and stamps (if any) of these bodies. In addition, audit reports may carry signatures of other related persons of internal audit service providers, depending on agreements between parties involved.

5. Annual audit reports: The annual audit report must carry the signature of the person in charge of the internal audit. Within the duration of 60 days from completion of a financial year, the person in charge of the internal audit must send an annual audit report which is the consolidated report on results of implementation of the internal audit plan in the previous year to those persons referred to in clause 1 of this Article. An annual audit report must clarify: Predetermined audit plan; audit tasks that have already been performed; unresolved issues and serious violations that have already been detected; measures recommended after the internal audit; assessment of the internal control system relating to activities to be audited and recommendations about this system for the purpose of building a more perfect one; situations of implementation of measures, recommendations and proposals after completion of the internal audit.

As regulations above, within the duration of 60 days from completion of a financial year, enterprises in Vietnam must submit annual audit reports which is the consolidated report on results of implementation of the internal audit plan in the previous year to entities under this article.

Is it permissible to outsource other bodies to assess the quality of internal audit activities of enterprises in Vietnam?

Pursuant to Article 19 of the Decree 05/2019/NĐ-CP stipulating assurance of quality of internal audit activities as follows:

1. A unit shall be required to carry out the internal assessment of internal audit activities in order to ensure quality of internal audit activities.

The internal assessment of internal audit activities refers to the self-assessment of internal audit activities after completion of an internal audit. The annual self-assessment of all of internal audit activities shall be performed by the internal audit department with the aim of assurance of quality of internal audit activities.

2. Annual internal assessment results must be reported to those specified in clause 4 of Article 12 herein.

3. Units in need of such assessment may outsource accredited independent bodies to assess the quality of internal audit activities.

As regulations above, enterprises are permissible to outsource accredited independent bodies to assess the quality of internal audit activities.

When shall enterprises in Vietnam submit unscheduled audit reports?

Pursuant to Article 17 of the Decree 05/2019/NĐ-CP stipulating unscheduled audit reports and specialized consultations as follows:

1. The internal audit department shall make an unscheduled report in the following cases:

a) In case where it is established that serious violations or high-level risks may cause adverse effects on an audited unit’s operations, the internal audit department of that unit must immediately report to those specified in clause 4 of Article 12 herein;

b) Send a timely notification to the head of the audited department/unit if unresolved issues specified in the audit report are not corrected or remedied on time after a specified time limit;

c) After informing the head of the audited department/unit as prescribed in point b of this clause, if these issues have not yet been corrected or remedied, a timely written notification must be sent to those specified in clause 4 of Article 12 herein.

2. During the process of carrying out internal audit activities, the persons in charge of internal audit of state-owned public service units affiliated to ministries, Ministry-level agencies, Governmental bodies and People’s Committees of centrally-affiliated cities and provinces may consult with and ask for professional opinions from the persons in charge of internal audit of the aforesaid ministries, Ministry-level agencies, Governmental bodies and People's Committees of centrally-affiliated cities and provinces.  

3. In the course of internal audit, the persons in charge of internal audit of state enterprises may consult with and ask for professional opinions from the persons in charge of internal audit of ministries, Ministry-level agencies, Governmental bodies, People’s Committees of centrally-affiliated cities and provinces that are representatives of owners of these state enterprises.

Best regards!