Process of periodic direct inspection of accounting service business activities in Vietnam

What are the regulations on the process of periodic direct inspection of accounting service business activities in Vietnam? - Cong Thanh (Quang Ngai, Vietnam)

Process of periodic direct inspection of accounting service business activities in Vietnam (Internet image)

1. What is periodic direct inspection?

According to Clause 2, Article 5 of Circular 09/2021/TT-BTC, periodic direct inspection is a form of checking accounting service business activities.

Specifically, direct inspection means the presiding inspector’s establishing the Inspectorate to inspect accounting services at accounting service businesses. Forms of direct inspection include: periodic inspection and ad-hoc inspection.

Periodic inspection: EAnnually, based on the time limits for periodic direct inspections specified in Article 7 of this Circular, the presiding inspector shall make a plan for direct inspection of accounting service business activities (Point 2.1, Clause 2, Article 5 of Circular 09/2021/TT-BTC)

2. Process of periodic direct inspection of accounting service business activities in Vietnam 

The process of periodic direct inspection of accounting services business activities is carried out in accordance with the provisions of Appendix I issued together with Circular 09/2021/TT-BTC, specifically as follows:

(1) Pre-inspection stage

- Selecting the accounting service provider to be subject to inspection

- Establishing the inspectorate

- Informing the selected accounting service provider.

(2) Inspection stage

* Step 1: The inspectorate works with the inspectee

- The inspectorate’s leader announces the presiding inspector’s decision on the direct inspection of accounting services;

- Requesting the inspectee to assign persons having relevant functions and competencies to cooperate with the inspectorate;

- The inspectee’s representative reports on the situation of organization, operation and process of provision of accounting services;

- Signing the commitment on compliance with independence and confidentiality rules of the inspectorate’s members using the sample given in Appendix II hereto in front of the inspectee's eyes;

- The inspectee provides required documents and records for the inspectorate.

* Step 2: Carrying out inspection according to subject matters of the inspection decision.

- Inspecting the compliance with laws on practicing and business of accounting services, relevant accounting legislation according to the following procedures:

+ Inspecting, reviewing documents and records related to registration for practicing and business of accounting services of the inspectee;

+ Studying documents and records to check whether the inspectee’s conformance to accounting service practicing and business requirements is maintained;

+ Examining and studying documents and records to check whether the inspectee has discharged the prescribed reporting or notification obligations;

+ Studying documents and records to check whether the inspectee has discharged their obligations to pay fees for issuance or re-issuance of the certificate of practicing in the accounting profession and the certificate of conformance to accounting service business regulations;

+ Assessing the level of the inspectee’s compliance with laws on practicing and business of accounting services.

- Inspecting the conformance to professional standards, accounting regimes and relevant accounting legislation according to the following procedures:

+ Selecting dossiers related to accounting service contracts for inspection in accordance with regulations of Article 17 of Circular 09/2021/TT-BTC;

+ Studying documents and records to check whether the inspectee’s procedures and processes for provision of accounting services conform to professional standards, accounting regimes and relevant accounting legislation;

+ Reviewing, examining and collecting suitable evidence for assessment of the inspectee’s compliance with professional standards, accounting regimes and relevant accounting legislation based on the table of assessment criteria, given in the Appendix III of Circular 09/2021/TT-BTC;

+ Assessing the conformance to professional standards, accounting regimes and relevant accounting legislation of each inspected dossier.

(3) Inspection completion stage

- After the direct inspection is completed, the inspectorate needs to draft the inspection minutes and discuss them with the inspectee’s legal representative. After ratifying the inspection minutes, the inspectee’s legal representative, the inspectorate’s leader and other members shall be responsible for signing the inspection minutes after completion of the inspection. If the inspectee disagrees over the inspectorate’s assessment opinions or conclusions, they must clarify their disagreement in the inspection minutes.

In case of discovering that the inspectee commits any administrative violation, the inspectorate must prepare and issue a notice of administrative violation, enclosing relevant documents and records, to the competent authority to seek their decision on administrative penalty in accordance with laws.

- The minutes on inspection of accounting service business activities must contain the following information:

+ Time and location of inspection, inspectee, participants in the inspectorate, purposes, scope of inspection and inspection limitations (if any);

+ General description of the inspected business and common characteristics of the inspection;

+ Brief description of the process for carrying out the inspection of accounting service business activities at the inspectee’s office;

+ Inspection results, including:

(i) Describing and commenting on the compliance with laws on practicing and business of accounting services;

(ii) Describing and commenting on the conformance to professional standards, accounting regimes and relevant accounting legislation;

(iii) Clarifying reasons and bases for arriving at conclusions on business of accounting services of the inspectee;

(iv) Describing major and systematic defects, and recommending remedies or corrective measures (if any).

(4) Post-inspection stage

- Addressing dissenting opinions on inspection results (if any).

- The presiding inspector makes and publishes the general review report on inspection results in accordance with Circular 09/2021/TT-BTC.  

Thanh Rin

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