IN WHAT CASES DOES AN ENTERPRISE ADJUST THE CERTIFICATE OF ELIGIBILITY TO CONDUCT BUSINESS IN AUDITING SERVICES?

Independent audit activities in the national economy are the foundation for the sustainable and effective development of the capital and financial markets. Therefore, independent auditing enterprises are set by the state with very strict conditions and regulations. Through today’s article, Pham Consult will learn with you about the issue of adjusting the Certificate of eligibility for auditing services business.

What are the conditions for granting a Certificate of eligibility to conduct business in auditing services for each type of enterprise?

1. For limited liability companies with two or more members:

Pursuant to the provisions of Clause 1, Article 21 of the Law on Independent Auditing 2011; Article 5, Article 6, Article 7 of Decree 17/2012/ND-CP, a limited liability company with two or more members applying for a certificate of eligibility to conduct business in auditing services must meet the following conditions: :

– Have a business registration certificate, enterprise registration certificate or investment registration certificate according to the provisions of law;

– There must be at least 05 practicing auditors, of which there must be at least 02 capital contributing members. The capital contribution of practicing auditors must account for over 50% of the company’s charter capital.

– The legal representative, Director or General Director of the limited liability company must be a practicing auditor;

– Ensure legal capital according to government regulations, from January 1, 2015 legal capital is 5 (five) billion VND.

– The capital contribution of organizational members must not exceed the level prescribed by the Government. The representative of an organizational member must be a practicing auditor.

2. For partnerships:

Pursuant to the provisions of Clause 2, Article 21 of the Law on Independent Auditing 2011, when a partnership company meets the following conditions, it will be granted a certificate of eligibility to conduct business in auditing services:

– Have a business registration certificate, enterprise registration certificate or investment certificate according to the provisions of law;

– Have at least 05 practicing auditors, including at least 02 partners;

– The legal representative, Director, General Director of the partnership must be a practicing accountant.

3. For private enterprises:

Pursuant to Clause 3, Article 21 of the Law on Independent Auditing 2011, private enterprises are granted certificates of eligibility to conduct audit service business when they fully meet the following conditions:

– Have a business registration certificate, enterprise registration certificate or investment registration certificate according to the provisions of law;

– Have at least 05 practicing auditors, of which there must be at least a private business owner;

– The owner of a private enterprise is also the director.

For branches of foreign auditing firms in Vietnam

4. Branches of foreign enterprises

Pursuant to Clause 4, Article 21 of the Law on Independent Auditing 2011 and Article 8 of Decree 17/2012/ND-CP, if a foreign enterprise branch meets the following conditions, it is allowed to apply for a certificate of satisfaction of business conditions. Independent audit service business in Vietnam:

– Foreign auditing firms are allowed to provide independent audit services according to the laws of the country where the foreign auditing firm’s headquarters is located;

– Have at least two practicing auditors, including the Director or General Director of the branch;

– The Director or General Director of a branch of a foreign auditing firm is not allowed to hold a management or executive position in another enterprise in Vietnam;

– The foreign auditing firm must send a document to the Ministry of Finance ensuring responsibility for all obligations and commitments of the foreign auditing firm’s branch in Vietnam;

– The allocated capital of a branch of a foreign auditing firm in Vietnam is not lower than the legal capital level for the limited liability company above.

 

In what cases does an enterprise adjust the Certificate of eligibility to conduct business in auditing services?

 

According to Article 24 of the Law on Independent Auditing 2011, regulations on re-issuing and adjusting the Certificate of eligibility to conduct business in auditing services are as follows:

Re-issuing and adjusting the Certificate of eligibility to conduct business in auditing services

1. Certificate of eligibility to conduct business in auditing services is reissued or adjusted in the following cases:
2. a) There is a change in the content of the Certificate of eligibility to conduct business in auditing services;
3. b) Certificate of eligibility to conduct business in auditing services is lost or damaged;
4. c) Division, separation, merger, consolidation, conversion of ownership form.
5. Dossier to request re-issuance or adjustment of Certificate of eligibility to conduct business in auditing services includes:
6. a) Application for reissuance or adjustment of Certificate of eligibility to conduct business in auditing services;
7. b) The original Certificate of eligibility to conduct business in auditing services has been issued, unless the original is no longer available;
8. c) Other documents related to the re-issuance and adjustment of the Certificate of eligibility to conduct business in auditing services.

Accordingly, the enterprise shall adjust the Certificate of eligibility to conduct business in auditing services when there is a change in the content of the Certificate of eligibility to conduct business in auditing services.

Does the content of the Certificate of eligibility to conduct business in auditing services require the name of a legal representative?

Pursuant to Clause 1, Article 8 of Circular 203/2012/TT-BTC stipulating the Certificate of eligibility to conduct business in auditing services as follows:

Content of Certificate of eligibility to conduct business in auditing services

1. Certificate of eligibility to conduct business in auditing services includes the following main information:
2. a) Name of the auditing firm; Name of the auditing firm in a foreign language (if any); Abbreviated name (if any); Head office address;
3. b) Full name of the legal representative and full name of the Director (General Director) of the audit firm (if not the legal representative);
4. c) Number and date of issuance of the Certificate of eligibility to conduct business in auditing services;
5. d) Number, date of issue and name of the agency issuing the Business Registration Certificate or Enterprise Registration Certificate or Investment Certificate;
6. d) Terms and conditions that audit firms must comply with when using the Certificate of eligibility to conduct business in auditing services.

Accordingly, the content of the Certificate of eligibility to conduct business in auditing services must include the full name of the legal representative and the full name of the Director (General Director) of the auditing firm (if not the legal representative).

 

What content does an application for a Certificate of eligibility to conduct business in auditing services include?

Article 22 of the Law on Independent Auditing 2011 stipulates the application dossier for issuance of Certificate of eligibility to conduct business in auditing services as follows:

 

– Application for issuance of Certificate of eligibility to conduct business in auditing services;

 

– Copy of Business Registration Certificate, Enterprise Registration Certificate or Investment Certificate;

 

– Copy of the auditing practice registration certificate of practicing auditors;

 

– Full-time labor contracts for practicing auditors;

 

– Documents proving capital contribution for limited liability companies;

 

– Other documents prescribed by the Ministry of Finance.

 

How long is the deadline for issuing a Certificate of eligibility to conduct business in auditing services?

Article 23 of the Law on Independent Auditing 2011 stipulates the deadline for granting a Certificate of eligibility to conduct business in auditing services as follows:

 

Time limit for issuance of Certificate of eligibility to conduct business in auditing services

1. Within thirty days from the date of receipt of valid documents, the Ministry of Finance shall issue a Certificate of eligibility to conduct business in auditing services to audit firms and branches of foreign audit firms in Vietnam; In case of refusal, the Ministry of Finance must respond in writing and clearly state the reason.
2. In case it is necessary to clarify issues related to the application dossier for issuance of Certificate of eligibility to conduct business in auditing services, the Ministry of Finance requires auditing firms and branches of foreign auditing firms in Vietnam to Nam requested to issue a Certificate of eligibility to conduct business in auditing services.

Within thirty days from the date of receipt of valid documents, the Ministry of Finance shall issue a Certificate of eligibility to conduct business in auditing services to audit firms and branches of foreign audit firms in Vietnam. ;

 

In case of refusal, the Ministry of Finance must respond in writing and clearly state the reason.

 

Thus, through the article on Pham Consult, we have helped you learn about the issue of Enterprises adjusting the Certificate of eligibility to conduct business in auditing services in which cases. Hope the above information will help your work.