08 Cases where practicing auditors are not allowed to audit in Vietnam

What are the cases where practicing auditors are not allowed to audit in Vietnam? - Cong Minh (Binh Phuoc. Vietnam)

08 Cases where practicing auditors are not allowed to audit in Vietnam (Internet image)

1. Who are practicing auditors?

According to Clause 2, Article 5 of the Law on Independent Audit 2011, auditors mean the persons who are granted certificates of auditors in accordance with law regulations or those who have certificates granted from foreign countries recognized by the Ministry of Finance and passed examination on the Vietnam law.

At that time, practicing auditors mean the auditors who have been issued certificates of registration of practicing audit.

(Clause 3, Article 5 of the Law on Independent Audit 2011)

2. Cases where practicing auditors are not allowed to audit in Vietnam

According to Article 19 of the Law on Independent Audit 2011, practicing auditors are not allowed to audit in the following cases:

(1) as members, founding shareholders, or purchasing shares or capital contribution in the audited unit;

(2) as those who hold managerial, administrative positions, members of the inspection committee or chief accountant of the audited units;

(3) as those who hold managerial, administrative positions, members of the inspection committee or chief accountant of the audited units for the audited financial year;

(4) within two years from the time of resigning the managerial, administrative positions, members of the inspection committee or chief accountant of the audited units;

(5) as those who are doing or have done in the preceding year the work of book keeping, making financial statements or internal audit for the audited units;

(6) as those who are doing or have done in the preceding year the service which is different from the services specified in item (5) affecting the independence of practicing auditors in accordance with provisions of professional ethical standards of accounting and auditing;

(7) with their parents, spouse, child, natural brother, sister who have remarkable direct or indirect financial interests in the audited units in accordance with provisions of professional ethical standards of accounting, auditing or those who hold managerial, administrative positions, members of the inspection committee or chief accountant of the audited units;

(8) Other cases in accordance with regulations of law.

3. Standards of auditors in Vietnam

According to Clause 1, Article 14 of the Law on Independent Audit 2011, auditors must meet the following standards:

- Having full civil act capacity;

- Having good morals, sense of responsibility, integrity, honesty, objectivity;

- Having degree of university or higher to be of financial, banking, accounting, auditing disciplines or other disciplines as prescribed by the Ministry of Finance;

- Having certificates of auditors in accordance with regulations the Ministry of Finance.

4. Those who are not registered audit practice in Vietnam

According to Article 16 of the Law on Independent Audit 2011, the following people are not allowed to register audit practice in Vietnam:

- Officials and public servants.

- Those who are banned from practicing audit upon valid judgments and decisions of the courts; those who are being prosecuted for penal liability; those who have been convicted one of the crimes on economy, position relating to finance and accounting but not be remitted; those who are subject to administrative measures of education at communes, wards and towns, sending into medical facilities, educational institutions.

- Persons who have criminal records on economic crimes from serious level or more.

- Those that violate the law on finance, accounting, auditing and economic management are sanctioned for administrative violations within one year from the date of the sanction.

- Those who are suspended to practice audit.

Thanh Rin

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