Clear, tough law needed for effective audits

February 25, 2017 - 11:41

Hồ Đức Phớc, Auditor General of the State Audit Office of Việt Nam, spoke to the newspaper Thời báo Kinh Tế Việt Nam (Việt Nam Economic Times) about his agency’s resolve to become an effective tool in controlling and managing the public finance and assets.

Hồ Đức Phớc, Auditor General of the State Audit Office of Việt Nam, spoke to Thời báo Kinh Tế Việt Nam (Việt Nam Economic Times) newspaper about controlling and managing public finances and assets

Some have said 2016 was a successful year for the State Audit Office of Việt Nam (SAV). What were some of your agency’s achievements?

In 2016, the SAV asked the National Assembly to revise or abolish 110 legal documents, aiming to protect the State budget from misuse and waste.

One of the key missions of the SAV is to ensure State assets are used properly.

Regarding our work in financial settlement in 2016, according to incomplete statistics, in 2016, the SAV revoked some VNĐ36 trillion ($1.56 billion) – an increase of VNĐ13trillion ($570million) compared with 2015. In 2016, our auditing mission expanded to new areas, including Build-Operate-Transfer (BOT) projects, the value of enterprises after equitisation, public financial management and State budget collection and expenditure.

Those successes were thanks to the great efforts of all employees of the SAV, including senior management officers nationwide.

In 2016, the SAV issued an instruction on improving the quality of auditing work and anti-corruption activities through auditing.

What are the SAV’s plans for this year?

In 2017, the SAV aims to conduct 234 auditing missions. We plan to focus our missions on checking the use of the Central budget and local budgets. The results will help the National Assembly and People’s Councils at different levels during the approval of their annual budget plans.

During our auditing missions, we’ll focus on auditing the work of management and usage of public money and assets; particularly the use of the State budget and assets.

This year, the SAV will conduct a special auditing mission on urban land and State owned enterprises land and the value of enterprises. At grass roots levels, we’ll conduct an audit on salary funds and the employment of full time staff.

We’ll also audit all BOT projects, government bonds, public debt and the restructuring of State owned enterprises.

Lastly, commercial banks and general corporations are also part of our auditing missions.

How will you audit BOT projects?

As we all know, BOT is a form of public-private partnership. Most BOT projects have focused on infrastructure development. Many BOT projects have shown their limitations and insufficiency during implementation.

In many projects, investor selection was not performed properly; this led to unfair competition and a lack of transparency. In addition, the percentage of disbursement of capital contributions in BOT projects is generally lower than investors’ commitments. Coupled with that, during our missions, we have detected many shortcomings in writing project documents, designs, budget estimation, final budget settlement and others.

In some projects, the time for capital recovery following our auditing missions has reduced considerably, for example the project to upgrade the Hồ Chí Minh Road, the construction time was slashed from 22 years to 12 years.

What problems does the SAV face?

The biggest challenge at present is the auditing policy and mechanism. For example, the 2015 Auditing Law came into force on January 1, 2016 but many articles in the law are too vague. This has caused problems for us in implementation, particularly the article on the use of electronic data as many offices did not allow us to access their data. We have already asked the National Assembly Standing Committee to issue a legal document compelling all agencies to provide documents/data, including electronic data, as requested by the SAV.

We have also asked the NA Standing Committee to develop a legal document on sanctioning offices/ agencies ignoring requests filed by SAV missions.

I’m confident if these two core problems are settled, it will help us a lot in improving the efficiency and effectiveness of our work.VNS