Is there a time limit for signing an audit contract? #
If your business belongs to Subjects required to be audited financial statements, with a fiscal year ending on December 31, the deadline for signing an audit contract is December 12 of that year. If the fiscal year ends on June 01, the deadline for signing the audit contract is May 12 of that year.
This is based on the provisions of Clause 2, Article 9 of the 2011 Law on Independent Audit which clearly states:
"Auditing contract of annual financial statements of enterprises, organizations is required to audit financial statements must be concluded at least thirty days before the end of the annual accounting period".
What will businesses suffer if they do not sign at the prescribed time? #
As prescribed at Clause 2, Article 54 of Decree 41/2018 / ND-CP guiding regulations on sanctioning of administrative violations in the field of accounting and independent audit, effective from May 01, 05, the act of entering into audit contracts is late compared to the maximum penalty. is 2018 million dong, specifically:
"A fine of from 5.000.000 VND to 10.000.000 VND shall be imposed on the enterprise or organization that is required to audit the annual financial statements that perform the conclusion of the audit contract of the financial statement slower than the period of time. term".
Auditing What is a financial statement? #
The implementation of procedures intended to obtain audit evidence about the amounts and disclosures in the financial statements. Procedures selected on the basis of the auditor's judgment, including assessing the risk of material misstatement of the financial statements due to fraud or error Audit also includes a assessment of appropriateness. of the accounting policies used and the reasonableness of accounting estimates, as well as evaluating the overall presentation of the financial statements.
It is the auditor's responsibility to express an opinion on these financial statements based on the audit results.
Why do we have to audit the financial statements? #
Because your business belongs to Subjects required to be audited annually according to current regulations of the State such as foreign-invested enterprises, listed enterprises and some other entities.
In addition, for the purpose of managing financial - accounting - tax risks, corporate governance, the implementation of auditing of financial statements helps enterprises to have their financial statements presented appropriately and properly. business operations and is always ready to provide information to third parties.
Is there any other benefit from early signing? #
The most important thing is that businesses have many benefits from early signing contracts as follows:
- review reports before implementing year-end data closing;
- be updated on the implementation of financial statements in accordance with current regulations;
- update current regulations and documents affecting business operations, financial statements of enterprises;
- guide enterprises to carry out compulsory inventory at the end of the year according to current regulations;
- save time completing financial statements from error correction;
- promptly detect errors, inappropriate issues when presenting information in the financial statements;
- Early completion of financial statements to submit to parties in accordance with current law.
With the above clear provisions and benefits, enterprises that are required to audit their annual financial statements should pay attention to concluding audit contracts ahead of time in accordance with the above provisions to avoid penalties. Unfortunately, as well as using audit costs to bring added value to your own business.
