Circular No. 06/2020/TT-NHNN on internal control and internal audit of the State Bank of Vietnam

 

CIRCULAR

Provisions on internal control, internal audit

State Bank of Vietnam

 

Pursuant to the Law on the State Bank of Vietnam dated June 16, 2010;

Pursuant to Government Decree No. 16/2017/NĐ-CP dated February 17, 2017 on the functions, tasks, powers, and organizational structure of the State Bank of Vietnam;

At the proposal of the Internal Audit Department Director;

The Governor of the State Bank of Vietnam issues the Circular stipulating provisions on internal control, internal audit of the State Bank of Vietnam.

 

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

This Circular stipulates provisions on internal control, internal audit of the State Bank of Vietnam (hereinafter referred to as the State Bank).

Article 2. Applicability

1. Units under the State Bank, including: Banking Inspection Authority; Departments, Bureaus and equivalent units; State Bank branches in provinces and centrally governed cities; public service units and other units established by the Governor of the State Bank (hereinafter referred to as the Governor).

2. Bank supervisors; persons engaged in internal control, internal audit of the State Bank.

3. Other organizations and individuals related to the activities of internal control and internal audit at the State Bank.

Article 3. Explanation of Terms

In this Circular, the following terms are understood as follows:

1. The State Bank's internal control system is the overall set of mechanisms, policies, procedures, internal regulations, organizational structure established and implemented in units under the State Bank in accordance with legal provisions, regulations of the State Bank, and provisions of this Circular aimed at controlling, preventing, detecting, and promptly addressing potential risks to ensure safe, effective operations and achieve set objectives.

2. Internal control activity is the supervision and inspection conducted by organizations, individuals, persons engaged in internal control, and/or those authorized to oversee departments, sections, units, and individuals during the execution of assigned tasks to identify inadequacies, shortcomings, violations for prompt resolution or recommendation to competent authorities for handling, ensuring the safe, effective management and use of resources and unit activities in compliance with the law.

 3. Internal audit activity is the examination, evaluation, and confirmation by the Internal Audit of the State Bank regarding the appropriateness and effectiveness of the internal control system; the truthfulness and reasonableness of financial information, management information; and the compliance and operational efficiency of the audited unit, thereby recommending corrective measures, handling violations, or providing advisory opinions to improve and enhance the effectiveness of the internal control system, helping the unit operate safely, in accordance with the law, and achieve set goals.

4. Risk-oriented internal control and internal audit is the method of control and audit based on identifying and assessing the risk level for each activity, business process, or within the unit's operations to reasonably and effectively implement internal control and audit measures.

5. Internal Control Department/Unit is the department or unit assigned to perform internal control tasks in units under the State Bank.

6. Persons engaged in internal control, internal audit are civil servants and officials assigned to perform internal control and internal audit tasks in units under the State Bank.

7. Close relatives include father, mother, foster father, foster mother, father-in-law, mother-in-law, husband, wife, biological child, adopted child, full brother, full sister, younger brother, brother-in-law, sister-in-law, younger brother-in-law, sister-in-law, younger sister-in-law, brother-in-law, sister-in-law, younger sister-in-law.

 

Chapter II

INTERNAL CONTROL

Article 4. Objectives internal control activities internal control

1. Ensuring the implementation of the unit's strategy and plans in the right direction and achieving set goals.

2. Ensuring the unit's operations comply with laws and regulations, business procedures, and State Bank rules, preventing and limiting risks; managing and using assets and resources safely, efficiently, and economically.

3. Identifying deficiencies and inadequacies and promptly recommending competent authorities to amend, supplement, or issue new mechanisms, regulations, and internal rules to strengthen measures ensuring asset safety and improving operational efficiency of the unit.

Article 5. Principles internal control activities internal control

1. Ensuring objectivity, compliance with laws and regulations, business procedures of the State Bank, and internal rules of the unit; suitability to the scale, nature, and specific characteristics of the unit's operations.

2. Conducting inspections and controls according to programs and plans approved by the unit's head and guided by the State Bank's business procedures.

3. Prioritizing resources and time for inspecting, controlling, and monitoring important activities or high-risk operations.

Article 6. Requirements internal control activities internal control

1. Internal control activities must be established and maintained for all operations, business processes, and transactions of the unit.

2. Internal control activities must ensure continuity, consistency, and alignment with daily control principles in the unit's operations, including:

a) Assignment, delegation, and authorization of tasks must be clear, transparent, and in accordance with regulations; ensuring separation of duties, powers, and responsibilities among individuals and units to avoid conflicts of interest; ensuring that no individual has the opportunity to manipulate operations or conceal illegal acts or breaches of relevant internal regulations for personal gain.

b) Ensuring dual control principle: Task assignment and business processing, especially high-risk businesses, must involve at least two people to monitor and control each other, ensuring compliance with regulations, protecting asset safety, and enhancing work efficiency, except where otherwise provided by law.

c) Strictly implementing reporting and timely, effective internal information exchange systems to ensure the unit's operations comply with the law.

3. Ensuring the responsibility and authority of unit leaders and each department in internal control activities; fully leveraging the role of the Internal Control Department/Unit and persons engaged in internal control based on the comprehensive and effective implementation of related regulations and business procedures and being accountable for the results of their tasks before the unit's head and the law.

4. Units, departments, and individuals must regularly review and check the implementation of relevant regulations, procedures, and internal rules to promptly identify deficiencies and inadequacies that may pose risks, recommending supplements and adjustments for appropriate prevention of risks and enhancement of internal control efficiency.

5. The heads of units under the State Bank shall be responsible for directing the implementation of work to analyze and assess risks associated with business activities within their functions and tasks in order to proactively prevent and take appropriate measures to control and manage risks.

6. Ensure the relative independence of internal control specialists in relation to departments, sections, individuals performing specialized and business tasks within the unit; minimize as much as possible the involvement of internal control staff in direct participation in specialized and business activities that fall under their inspection, supervision, and monitoring scope. Do not assign internal control staff (including department leaders responsible for internal control) who are relatives of the unit head.

7. The assignment of internal control specialists must meet the professional standards, skills, experience, and moral qualities of the internal auditor position as stipulated by the State Bank.

Article 7. Scope and methods of internal control activities

1. The scope of internal control activities includes all activities, business operations, and transactions carried out by the unit.

2. The method of internal control is a method of compliance testing and risk-oriented monitoring, prioritizing and strengthening supervision and inspection of important or high-risk activities and business operations.

Article 8. Contents of Internal Control Activities

1. Regularly review documents to promptly issue, amend, and supplement regulations, procedures, and internal rules to clearly define the content of work, tasks, authorities, and responsibilities of the unit and each department, section, and individual in managing and handling work in accordance with regulations, strictly, scientifically.

2. Conduct self-inspection, monitoring, and supervision of the implementation of accounting systems, financial management, asset management, safety of vault operations, information technology, and the compliance and effectiveness of operations by sections and individuals within the unit; review and evaluate the appropriateness and effectiveness, identify existing issues, and propose necessary changes to the internal control system to protect assets and improve management and operational efficiency of the unit.

3. Classify, manage, and utilize the unit's information and reporting systems in accordance with the State Bank's regulations, ensuring smooth and continuous operation.

4. Establish a monitoring and reporting mechanism., exchange internal information effectively to prevent risks and serve the management and operation of the unit appropriately and efficiently.

Article 9. Directing, guiding, and inspecting internal control work

1. The Governor decides on the methods and approaches to establish the internal control system of the State Bank of Vietnam in accordance with the provisions of the law and the requirements of managing and operating the State Bank of Vietnam during each period.

2. The Internal Audit Department advises and proposes to the Governor:

a) Methods and approaches to establish and maintain an effective and efficient internal control system for the State Bank of Vietnam.

b) Issuing regulations to guide business operations and internal control procedures for units under the State Bank of Vietnam.

c) Directing and implementing inspections and evaluations of the internal control systems of units; proposing to the Governor measures to improve mechanisms, business operation procedures, and organization of internal control activities at the State Bank of Vietnam to ensure effectiveness and efficiency.

d) Proposing the provision and exploitation of relevant information and documents to effectively carry out internal control activities at the State Bank of Vietnam.

Article 10. Responsibilities and authorities of Unit Heads

1. Responsibilities:

a) Establishing and maintaining an internal control system and organizing internal control activities at the unit in accordance with Articles 5, 6, 7, and 8 of this Circular and other relevant regulations of the State Bank of Vietnam, and being responsible to the Governor for internal control work at the unit.

b) Developing and issuing internal regulations and specific business operation procedures to implement functions, tasks, management, and use of assigned assets, ensuring compliance with laws and regulations of the State Bank of Vietnam.

c) Directing the provision and exploitation of information related to internal control activities at the unit; closely coordinating with the Internal Audit Department in implementing supervisory measures and exploiting information for risk assessment and warning.

d) Directly directing and overseeing the Internal Control Department or person responsible for internal control activities at the unit; arranging dedicated personnel for internal control activities at the unit in accordance with Clause 6 and Clause 7 of Article 6 of this Circular; creating conditions for the Internal Control Department or person responsible for internal control activities to effectively perform their assigned tasks.

e) For units without an Internal Control Department or dedicated personnel for internal control activities, the Head of the unit shall establish and maintain an internal control system and organize internal control activities in accordance with this Circular based on the scale, nature of operations, and management requirements, and be responsible to the Governor for compliance with laws and ensuring asset safety in the unit's operations.

2. Authorities:

a) Being authorized to arrange human resources and decide on specific measures and methods to implement internal control activities at the unit in accordance with this Circular and other relevant regulations of the State Bank of Vietnam.

b) Proposing to the Governor amendments, supplements, and improvements to mechanisms, regulations, and business operation procedures to enhance the effectiveness of internal control activities at the unit and the State Bank of Vietnam.

c) Handling according to authority or recommending competent authorities to handle violations of laws and regulations of the State Bank of Vietnam discovered through internal control activities.

d) Other rights as prescribed by law and the State Bank of Vietnam.

Article 11. Tasks and authorities of the Internal Control Department/Unit and full-time internal control staff at units

1. Duties:

a) Develop annual and periodic (if any) inspection and internal control programs and plans to submit for approval by the Head of the unit; organize the implementation of such programs and plans after they have been approved.

b) Assist the Head of the unit in implementing internal control activities in accordance with this Circular and other relevant regulations of the State Bank.

c) Directly inspect, monitor, and supervise business operations and asset safety according to assigned tasks; make recommendations and proposals to the Head of the unit to amend, supplement, and improve business procedures, address existing issues and violations through internal control activities, and be responsible before the Head of the unit for the results of the assigned tasks.

d) Report the results of internal control to the Head of the unit as prescribed and upon request.

đ) Continuously update and study relevant documents, regulations, business procedures, and professional knowledge and skills to meet job requirements.

2. Authorities:

a) Have access to and provide all necessary and timely information and documents related to the unit's activities, business operations, and transactions to perform internal control tasks.

b) Recommend the Head of the unit to take necessary measures to enhance the effectiveness and efficiency of internal control activities within the unit, directing the resolution of existing issues and violations through internal control activities.

c) Be provided with necessary conditions and arrangements to perform their tasks; be sent to training courses to improve professional expertise, business skills, and work competencies.

d) In case of discovering actions violating laws and regulations of the State Bank that may lead to risks of information security breaches, loss of money and assets, the Internal Control Department/Unit and full-time internal control staff must immediately report to the Head of the unit for handling within their authority; if the Head of the unit does not handle or handles improperly, they have the right to report in writing to the Governor (through the Internal Audit Department).

Article 12. Reporting on Internal Control Work

1. The Internal Control Department/Unit and full-time internal control staff shall periodically or urgently report the results and situation of internal control work to the Head of the unit. The content, method, and deadline for reporting shall be specified by the Heads of the units.

2. Annually, units shall report the results and situation of internal control work to the Governor (through the Internal Audit Department) before January 15 of the following year in accordance with the attached Appendix to this Circular as stipulated in Clause 1, Article 2 of this Circular.

In case of urgent risks leading to loss of money, assets, and information security managed by the unit, the unit must promptly report in writing to the Governor (through the Internal Audit Department) within 24 hours from when the incident is discovered.

3. The Internal Audit Department shall aggregate, advise, and propose the Governor to direct and handle recommendations in internal control work at units under the State Bank.

Chapter III

INTERNAL AUDIT

Article 13. Objectives of Internal Audit Activities

1. Evaluate the appropriateness and effectiveness of the internal control system and the effectiveness of internal control activities of the audited unit.

2. Assess compliance with laws and regulations, and business procedures of the State Bank regarding financial information, assets, management information, and operational effectiveness of the audited unit.

3. Through audit recommendations, advise the audited unit on measures to address existing issues, improve, and enhance the effectiveness of internal control activities, ensuring asset safety, lawful operations, and achieving objectives.

Article 14. Principles of Internal Audit Activities

1. Ensure independence, honesty, objectivity, transparency, and openness.

2. Comply with laws, regulations, and business procedures of the State Bank; implement audit programs and plans approved by the Governor.

3. Not interfere or obstruct normal operations of the audited unit; protect state secrets and the secrets of the audited unit.

4. The Governor is the final decision-maker on issues with differing opinions among units related to internal audit activities of the State Bank.

Article 15. Requirements for Internal Audit Activities

1. Not be subject to interference in determining the scope of audits, performing tasks, and exchanging audit results, nor be restricted in accessing audit information and documents.

2. Bank auditors and internal audit staff must maintain an impartial, fair attitude, free from bias, and avoid conflicts of interest with the audited unit during the audit process. They have the right and obligation to report issues that may affect their independence and impartiality before and during the audit to the authorized person as prescribed in the Internal Audit Regulations of the State Bank.

3. Not assign bank auditors or internal audit staff to conduct audits on:

a) Activities or units where they were responsible for performing activities or management in the last three years.

b) Regulations, procedures, and processes that they were primarily responsible for establishing.

c) Units where they have relatives serving as the Head, Chief Accountant (or Head of Accounting Department), Head of the Internal Control Department/Unit, or full-time internal control staff of that unit.

Article 16. Application of Professional Standards and Ethical Principles in Internal Audit Activities

The internal audit activities of the State Bank of Vietnam aim to align with and ensure compatibility with the Vietnamese Internal Audit Standards system and comply with the internal audit professional ethical principles established by competent state authorities.

Article 17. Prohibited Conducts in Internal Audit Activities

1. The following conducts are strictly prohibited for the Internal Audit Department, the Head of the Audit Team, and members of the Audit Team:

a) Harassing, causing difficulties, or inconveniencing the audited unit.

b) Misusing position or authority for personal gain.

c) Illegally interfering with the normal operations of the audited unit.

d) Colluding or coordinating with the audited unit to distort the content of the audited information.

đ) Accepting bribes.

e) Disclosing state secrets, secrets of the audited unit; disclosing audit information, situations, and results before they are officially issued or announced.

g) Reporting false or incomplete audit results.

h) Engaging in other acts contrary to laws and regulations of the State Bank of Vietnam.

2. Strictly prohibit the following actions against audited units and related organizations and individuals:

a) Refusing to provide information or documents (including confidential information) related to the audit plan and content upon request from the Internal Audit Department or the Internal Audit Team.

b) Obstructing or making difficulties for internal audit work.

c) Reporting false, untruthful, incomplete, untimely, or biased information and data related to internal audit content.

d) Bribing the Audit Team.

đ) Concealing violations of laws concerning assets, finance, and budget.

e) Other prohibited acts as stipulated by laws and regulations of the State Bank of Vietnam.

3. Strictly prohibit organizations and individuals from interfering illegally in internal audit activities.

Article 18. Management and Direction of Internal Audit Activities

The Governor directly directs and supervises the internal audit activities of the State Bank of Vietnam, including:

1. Issuing or authorizing the issuance of documents, regulations, and procedures on internal audit of the State Bank of Vietnam within their authority.

2. Approving the annual and ad hoc internal audit plans of the State Bank of Vietnam.

3. Deciding on the appointment and dismissal of bank supervisors.

4. Implementing necessary measures for managing and overseeing the internal audit activities of the State Bank of Vietnam, including promptly addressing legal violations and breaches of internal audit regulations; directing the supervision and evaluation of internal audit activities to ensure audit objectives and effectiveness.

5. Ensuring adequate resources for internal audit activities; deciding on issues related to the rights of internal auditors at the State Bank of Vietnam.

6. Directing the handling or handling within their authority complaints, reports, and recommendations from audited units and other organizations or individuals regarding internal audit activities of the State Bank of Vietnam.

Article 19. Scope and Objects of Internal Audit

1. The scope of internal audit includes all activities and business processes of the State Bank of Vietnam. Based on the approved audit plan by the Governor, the Director of the Internal Audit Department decides on the specific audit scope suitable for each audit.

2. The objects of internal audit are all units under the State Bank of Vietnam as stipulated in Clause 1, Article 2 of this Circular.

Article 20. Internal Audit Method

The method for conducting internal audit is risk-oriented auditing, prioritizing resources to audit units, activities, and business processes assessed as having high risks.

The Director of the Internal Audit Department guides the methods and procedures for conducting risk-oriented internal audits.

Article 21. Content of Internal Audit Activities

1. The State Bank's internal audit shall conduct audits as follows:

a) Financial audit: An audit to assess and confirm the accuracy and truthfulness of financial information and financial reports of the audited unit.

b) Compliance audit: An audit to evaluate and confirm compliance with laws, internal regulations, and rules that the audited unit must follow.

c) Operational audit: An audit to assess the economy, effectiveness, and efficiency in managing and using public funds and assets.

d) Other audit contents appropriate to the tasks and authorities of the State Bank's internal audit.

2. Based on the requirements of each audit, the Director of the Internal Audit Department decides on the content of the audit accordingly.

Article 22. Internal Audit Plan

The internal audit plan includes the annual audit plan and detailed audit plan:

1. Annual audit plan: Based on objectives, annual policy implementation plans, risk assessment results, and current human resources, the Director of the Internal Audit Department develops the State Bank's annual internal audit plan to be submitted for approval by the Governor before December 31 each year and notifies the audit plan to units under the State Bank. The annual internal audit plan includes the content, scope, and objects of the audit and must meet the following requirements:

a) Risk-oriented approach: Activities, business processes, and units with high risks must be prioritized for concentrated audit resources with higher cycles and frequencies.

b) Ensure comprehensiveness: All activities, business processes, and units must be audited.

c) Must reserve sufficient time to conduct surprise audits immediately upon request from the Governor or when there are signs of violations or high-risk indications at units.

d) Adjust the plan when there are significant changes in audit content, scope, risk developments, current resources, or according to the Governor's requirements.

2. Detailed audit plan: Based on the annual audit plan approved by the Governor, the Director of the Internal Audit Department develops and issues detailed audit plans and schemes suitable for available resources and actual conditions of each audit, including estimated audit time, audit team composition, audit focus, and other related requirements. The preparation of detailed audit plans for audits is carried out in accordance with the State Bank's internal audit process.

Article 23. Implementation of the annual internal audit plan, audit decision audit, audit decision

1. Based on the approved audit plan, the Director of the Internal Audit Department organizes the implementation of audits in accordance with the State Bank's internal audit regulations and procedures.

2. The Governor authorizes the Director of the Internal Audit Department to sign audit decisions according to the annual audit plan and ad hoc audit plan already approved by the Governor. The audit decision includes the following contents:

b) Audited unit;

c) Objectives, content, scope of the audit;

d) Time and location of the audit;

e) Head and members of the audit team;

f) The audit decision must be notified to the audited unit at least three working days before the audit begins, except in cases of surprise audits at the request of the Governor.

e) Other contents (if any).

The audit decision must be notified to the audited unit at least three days before the audit begins, except in cases of ad hoc audits requested by the Governor. During the audit process, if it is necessary to change the contents specified in points a, b, c, d, and đ of this clause, the Director of the Internal Audit Department must issue a written decision and notify the audited unit and members of the audit team.

Article 24. Internal Audit Reports

1. Audit Report: Is a report prepared by the Audit Team for each audit or specific audit content. The audit report must clearly state the key contents of the audit, including: objectives, scope, and results of the audit.

The establishment, issuance, and submission of the audit report as stipulated herein shall be carried out in accordance with the internal audit process of the State Bank of Vietnam as prescribed by the Governor.

2. Annual Audit Results Report: Is a report on the results according to each audit content or the entire audit activities in the year. The report content must clearly state: the implementation of the approved audit plan, the focus of the audit in the year; the identified issues and violations through audits; recommendations and the results of implementing the recommendations of internal audit; assessment of the internal control system related to the audited activities and proposals to improve the internal control system.

The Internal Audit Department is responsible for reporting to the Governor the results of internal audit in accordance with the provisions of this clause before January 30 of the following year.

3. Urgent Report: In case of discovering serious violations or when there is a high risk of loss of assets, information security at the audited unit affecting the operations and reputation of the State Bank of Vietnam, or upon request of the Bank's Management Board, the Internal Audit Department must promptly report in writing to the Governor within 48 hours to have appropriate measures taken.

Article 25. Recommendations and Implementation of Recommendations in Internal Audit Activities

1. Recommendations in internal audit reports are divided into two types, including:

a) Recommendation: Is an opinion raised when internal audit discovers that the activities of the unit contain violations, errors, or are not timely and comprehensive as required by laws, the State Bank of Vietnam, and the audited unit.

b) Suggestion: Is an opinion raised when internal audit evaluates and determines that the activities/business practices conducted by the unit involve high risk factors leading to asset safety risks, information security risks, or require modification and supplementation of business procedures to prevent risks, enhance quality, and efficiency of operations.

2. The audited unit and other related units are responsible for complying with and promptly and fully implementing the recommendations in the audit report. For suggestions in the audit report, it is encouraged that the audited unit and other related units study and apply them to modify, supplement, and perfect business procedures, prevent risks, and enhance operational efficiency.

3. The Internal Audit Department is responsible for supervising, monitoring, inspecting, and evaluating the implementation of recommendations and suggestions by the audited unit.

Article 26. Tasks and Authorities of the Internal Audit Department

1. Duties:

a) Prepare annual or urgent internal audit plans as required and submit them to the Governor for approval.

b) Evaluate the rationality, effectiveness of the internal control system, and the compliance and effectiveness of the audited unit's operations; recommend corrective measures for errors, handle violations; advise on measures to improve and enhance the effectiveness of the internal control system; monitor, supervise, and inspect the implementation of internal audit recommendations and suggestions.

c) Develop, supplement, and perfect the methods and ways of conducting internal audit of the State Bank of Vietnam to enhance the quality and effectiveness of auditing and meet management and operation requirements of the Bank's Management Board.

d) Advise the heads of units under the State Bank of Vietnam on improving the internal control system, risk assessment procedures, and risk management based on their assigned functions and tasks.

đ) Coordinate with relevant units under the State Bank of Vietnam to develop professional skills frameworks and occupational skills for bank auditors as a basis for recruitment, utilization, training, and development of personnel engaged in internal control and internal audit work.

e) Establish and maintain a mechanism for professional exchange with the National Audit Office, Banking Supervision Authority, and related audit agencies to seek professional advice and effectively coordinate work; serve as the lead unit coordinating with relevant agencies and units in handling issues related to the functions and tasks of internal audit., giám sát ngân hàng và các cơ quan, đơn vị kiểm toán liên quan nhằm tham vấn chuyên môn và phối hợp công tác có hiệu quả; là đơn vị đầu mối, phối hợp với các cơ quan, đơn vị có liên quan trong việc xử lý những vấn đề có liên quan đến chức năng, nhiệm vụ của kiểm toán nội bộ.

2. Authorities:

a) Shall be equipped with all necessary resources, means, and other conditions suitable to meet the requirements of internal audit activities.

b) Shall have access to, utilize, and provide all necessary and timely information, documents, files, and reports to serve internal audit work; request the audited unit to report and explain in writing any contents related to internal audit (if necessary).

c) Shall have access to and interview all civil servants, officials, and employees of the audited unit regarding matters related to the audit content and scope.

d) Shall be entitled to attend meetings of the Bank's Management Board in accordance with the working regulations of the State Bank of Vietnam to obtain information serving internal audit work.

đ) Shall have the right to supervise, monitor, inspect, and evaluate the activities of rectification, improvement, and perfection of units concerning issues recommended and suggested by internal audit.

e) Other authorities as prescribed by the Governor and laws.

Article 27. Responsibilities and Authorities of the Head of the Internal Audit Department

1. Responsibilities:

a) Organize the implementation of the approved internal audit plan to ensure progress, effectiveness, and quality of audits; be responsible before the Governor for the results of internal audit activities.

b) Report to the Governor on the results of internal audits or issues related to the internal audit activities of the State Bank according to requirements.

c) Organize risk assessment for the business operations of the State Bank to develop and implement effective internal audit plans; organize evaluation and control of the quality of internal audit activities of the State Bank as stipulated in Article 31 of this Circular.

d) Implement specific measures to maintain and ensure the requirements in internal audit activities as prescribed in Article 15 of this Circular; strengthen discipline and order in internal audit activities; combat negative manifestations, embezzlement, and corruption in internal audit activities.

đ) Examine and resolve complaints and recommendations from audited units related to internal audit activities within their authority; examine and resolve recommendations for reservations regarding audit conclusions made by the Head of the Audit Team and members of the Audit Team.

e) Propose and coordinate with relevant units to organize training and professional development for internal auditors and those involved in internal control activities to meet assigned tasks and standard requirements as prescribed.

g) Perform other tasks as required by the Governor related to internal audit activities.

2. Authorities:

a) Recommend and propose to the Governor to issue or issue within their authority regulations and procedures to manage and operate internal audit activities effectively.

b) Delegated by the Governor to sign audit decisions as prescribed in Clause 2, Article 23 of this Circular.

c) Take the initiative and decide on specific measures in implementing the internal audit plan.

d) Recommend to the Governor to resolve difficulties and obstacles in internal audit activities.

đ) Recommend to the Governor to consider responsibility and handle organizations and individuals who do not comply with audit decisions, conclusions, or recommendations, or engage in violations discovered through internal audits.

e) Decide on the exploitation and use of internal audit files to serve assigned tasks or provide them to relevant organizations and individuals in accordance with laws and regulations of the State Bank.

g) Exercise other authorities as prescribed by law.

Article 28. Internal Audit Teams

1. Internal audit teams are established to perform audit tasks according to approved plans and programs.

2. The composition of the audit team includes the Head, Deputy Head (if any), and members. The internal audit team is decided to be established by the Head of the Internal Audit Department based on the requirements of the audit.

3. Criteria for the Head and Deputy Head of the Audit Team:

a) Possess professional qualifications, leadership capabilities, and work experience appropriate to the assigned tasks.

b) Be a senior bank controller or hold positions equivalent to Deputy Department Heads or higher.

4. Activities of the Audit Team; duties, authorities, and responsibilities of the Head and members of the Audit Team shall be carried out in accordance with the internal audit regulations and procedures of the State Bank as prescribed by the Governor.

Article 29. Responsibilities and Authorities of Units Subject to Internal Audit

1. Responsibilities:

a) Comply with internal audit decisions;

b) Establish and provide all necessary, timely information, documents, files, reports (including confidential information, documents, files, reports) related to the audit plan and content upon request from the Internal Audit Department and the Internal Audit Team; be responsible before the Governor for the accuracy, truthfulness, and objectivity of the provided information and documents.

c) Provide full, timely explanations and answers to issues within the scope of the audit when requested by the Internal Audit Team and be responsible for the opinions given.

d) Create favorable conditions for the Internal Audit Team during the performance of their tasks; arrange working locations and conditions for the Internal Audit Team.

đ) Implement fully and promptly all conclusions and recommendations of the audit and report in writing on the implementation of audit conclusions and recommendations to the State Bank (through the Internal Audit Department).

2. Authorities:

a) Refuse to provide information and documents unrelated to the audit content.

b) Provide written explanations about issues mentioned in the draft audit report if deemed inappropriate.

c) Appeal to the Head of the Internal Audit Department or the Governor regarding the assessment, conclusion, and recommendation of the internal audit if there is sufficient basis to affirm that the internal audit opinions are unreasonable or contrary to the law.

d) Appeal to the Head of the Internal Audit Department or the Governor regarding illegal actions of the Head of the Internal Audit Team and members of the Internal Audit Team; propose replacement of the Head of the Internal Audit Team and members of the Internal Audit Team if there is sufficient evidence of legal violations, breaches of auditing principles and requirements affecting the truthfulness and objectivity of the audit results.

đ) Exercise other rights as provided by law and the State Bank of Vietnam.

Article 30. Regulations and Procedures for Internal Audits

1. The internal audit regulations stipulate the organization and operation of the State Bank's Internal Audit Team.

2. The internal audit procedures stipulate the sequence, content, and procedures for conducting internal audits carried out by the State Bank's internal audit.

3. The internal audit regulations and procedures are issued by the Governor based on the proposal of the Head of the Internal Audit Department.

Article 31. Ensuring Quality of Internal Audit Activities

1. Internal audit activities and internal audits of the State Bank must be internally monitored and evaluated to ensure audit requirements and quality.

2. The Head of the Internal Audit Department specifies, guides, and organizes the evaluation and control of the quality of internal audit activities of the State Bank in accordance with assigned requirements and tasks.

 

Article 32. Internal Audit Files

1. Documentation for each audit must be established in a file.

2. Responsibilities, methods of establishment, components, and list of internal audit files are carried out according to the State Bank's internal audit regulations and procedures.

3. The preservation and storage of internal audit files shall be implemented in accordance with the provisions of the law and the regulations of the State Bank of Vietnam on archiving.

4. The utilization and exploitation of internal audit files are regulated by the Head of the Internal Audit Department.

Chapter IV

BANK AUDITORS

Article 33. Bank Controllers

1. Civil servants directly engaged in internal control and specialized internal audit work at the State Bank may be considered for appointment to the bank controller rank if they meet the required conditions and standards set by the State Bank.

2. The bank controller rank includes: Bank Controller, Senior Bank Controller, and Senior-Level Bank Controller.

3. Bank controllers perform their duties and responsibilities as prescribed by the Governor and other relevant documents; enjoy state and State Bank policies and benefits as stipulated.

Article 34. Appointment and Removal of Bank Supervisors

1. Based on the conditions and criteria prescribed by the Governor, units shall establish files for the appointment and removal of bank auditors and submit them to the Department of Organization and Cadres.

2. The Cadre Organization Department shall take the lead and coordinate with the Internal Audit Department to submit to the Governor for decision on the appointment and removal of bank supervisors in accordance with the regulations.

Chapter V

IMPLEMENTING PROVISIONS

Article 35. Effective Date

This Circular takes effect from August 15, 2020, and replaces Circular No. 16/2011/TT-NHNN dated August 17, 2011, issued by the Governor of the State Bank of Vietnam on internal control and internal audit at the State Bank of Vietnam.

Article 36. Implementation

The Director of the Office, Heads of the Internal Audit Department, Heads of units under the State Bank of Vietnam, and Governors of the State Bank of Vietnam branches in provinces and centrally governed cities are responsible for implementing this Circular.