Regulations on the Time Limit for Direct Inspection of Audit Service Quality

Regulations on the time limit for direct inspection of audit service quality (illustrative image)

Circular 157/2014/TT-BTC stipulates the time limit for direct inspection of audit service quality, including periodic inspection and ad-hoc inspection as follows:

1. Periodic Inspection:

- Inspection at least once every 3 years for auditing firms approved to audit entities with public interest in the securities sector;- Inspection at least once every 4 years for auditing firms approved to audit other public interest entities (excluding auditing firms approved to audit entities with public interest in the securities sector);- Inspection at least once every 5 years for auditing firms not subject to the aforementioned regulations;- In cases where the result of the periodic direct inspection on the quality of audit services of the auditing firm results in an opinion concluding that the audit service quality is classified as 3 “Audit service quality does not meet the requirements” or classified as 4 “Audit service quality is poor, with serious flaws,” the auditing firm shall be re-inspected one to two years thereafter.

2. Ad-hoc Inspection:

An auditing firm may be subject to ad-hoc inspection in any of the following cases:

- There are signs of violations regarding audit service results or severe violations of professional standards, laws, and related regulations during the operation and provision of audit services;- Providing audit service contracts that may lead to significant audit risk, replacing audit service contracts provided by another audit firm for the same client without a legitimate reason;- Significant disputes among partners or significant changes in practicing auditors of the audit firm leading to the potential for a substantial impact on the audit service quality of the audit firm;- There is information reflecting, denouncing acts of unfair competition to attract clients or harming the interests of other audit firms.

Note: An auditing firm that has been subject to an ad-hoc inspection may not continue with a periodic inspection immediately within that year, or the periodic inspection may be combined with the ad-hoc inspection to verify the issues outlined in point 2.

For details, refer to the Circular 157/2014/TT-BTC effective from October 23, 2014.

Ty Na

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