Vietnam: Performance method of the internal audit

According to Article 17 of Circular No. 44/2011/TT-NHNN of the State Bank of Vietnam, performance method of the internal audit is prescribed as follows:

- Performance method of the internal audit shall be “risk-oriented” auditing method, priority shall be given to resources concentration for auditing units, departments, processes which are considered as highly risky.

- Internal auditor shall define, analyze, measure risks and draw up a risk profile for each operation of the credit institution, foreign bank’s branch. The risk profile shall include all potential risks, possible effects of those risks on the operation of the credit institution, foreign bank’s branch and occurrence possibility of those risks. Based on the valuation of the effect, possibility of the risk occurrence; each risk shall be classified into high, or medium or low risks. The measurement, classification of risks shall be performed on an annual basis at the minimum.

- The result of risk measurement shall be the basis for the Chief of internal audit to work with the Controllers' Committee, the General Director (Director) and the Board of Directors, Board of Members in the preparation of the annual internal audit plan. All the risks shall be rated by descending order, activities which are considered as highly risky shall be given the priority to concentrate more resources, more time on the auditing, priority to perform the auditing first and more regular than those with low risk exposures.

- The internal audit plan must be drawn up based on the risk measurement results and must be updated, amended and adjusted in accordance with the development, changes in the operation of the credit institution, foreign bank’s branch and changes of accompanied risks.

View details at Circular No. 44/2011/TT-NHNN of the State Bank of Vietnam, effective from February 12, 2012.

Thuy Tram

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