Audit Law of the People's Republic of China(Amended in 2006)

Audit Law of the People's Republic of China(Amended in 2006)

Order of the Chairman of the People's Republic of China No. 48

February 28, 2006

(Adopted at the Ninth Session of the Standing Committee of the Eighth National People's Congress on August 31, 1994, and amended in accordance with the Decision on Amending the Audit Law of the People's Republic of China at the 20th meeting of the Standing Committee of the 10th National People's Congress of the People's Republic of China on February 28, 2006)

Contents
Chapter I General Provisions
Chapter II Auditing Organs and Auditors
Chapter III Functions and Responsibilities of Auditing Organs
Chapter IV Limits of Power of Auditing Organs
Chapter V Audit Procedures
Chapter VI Legal Liabilities
Chapter VII Supplementary Provisions

Chapter I General Provisions

Article 1 In order to strengthen the audit supervision of the State, maintain the fiscal and economic order of the State, enhance the efficiency in using fiscal capital, promote the construction of a clean government and ensure the sound development of national economy and the society, this Law is formulated in the light of the Constitution of the People's Republic of China.

Article 2 The State shall carry out an audit supervision system. Auditing organs shall be set up by the State Council and the local people's governments at or above the county level.
The government revenues and expenditures of all the departments of the State Council, of the local people's governments at all levels and their departments, the financial revenues and expenditures of State-owned financial institutions, enterprises and public institutions, as well as other government revenues and expenditures and financial revenues and expenditures that should be audited in the light of this Law shall be taken the audit supervision in the light of the provisions prescribed in this Law.
Auditing organs shall implement audit supervision over the authenticity, legality and effectiveness of the government revenues and expenditures or financial revenues and expenditures specified in the preceding Paragraph.

Article 3 Auditing organs shall implement audit supervision in the light of the functions and procedures prescribed in the law.
An auditing organ shall make audit evaluation in accordance with the laws and regulations on government revenues and expenditures and financial revenues and expenditures as well as other relative provisions of the State, and shall make an audit decision under its statutory authorities.

Article 4 The State Council and the local people's government at or above the county level shall annually put forward to the standing committee of the people's congress at the same level an audit work report of the auditing organ on budget implementation and other government revenues and expenditures. An audit work report shall put stress on the audit of budget implementation. When necessary, the standing committee of the people's congress may make a resolution on the audit work report.
The State Council and the local people's government at or above the county level shall hand in a report to the standing committee of the people's congress at the same level about the correction of the problems found out in the audit work report and the handling results.

Article 5 Auditing organs shall independently exercise their power of audit supervision in the light of the law, and not be interfered by any administrative organ, social organization or individual.

Article 6 When conducting audit matters, auditing organs and auditors shall be objective and fair, practical and realistic, clean and devoted, and shall keep secrets to themselves.

Chapter II Auditing Organs and Auditors

Article 7 The National Audit Office shall be set up by the State Council to be responsible for the audit work all over the country under the leadership of the Premier of the State Council. The Auditor-General shall be the administrative leader of the National Audit Office.

Article 8 The auditing organs of the people's governments of the provinces, autonomous regions, municipalities directly under the Central Government, cities divided into districts, autonomous prefectures, counties, autonomous counties, cities not divided into districts, and districts under the jurisdiction of cities shall be responsible for the audit work in their respective administrative areas under the respective leadership of the governor of the provinces, chairman of the autonomous regions, mayors, head of prefectures, counties and districts, as well as under the leadership of auditing organs at the next higher levels.

Article 9 Local auditing organs at all levels shall be responsible for reporting their work to the people's governments at the same levels and the auditing organs at the next higher level, and their audit work shall be chiefly under the direction of the auditing organs at the next higher level.

Article 10 In accordance with the requirements for the work, an auditing organ may, upon the approval of the people's government at the same level, set up dispatched offices under its audit jurisdiction.
The dispatched organs shall implement the audit work upon the strength of the authorization granted by the auditing organ.

Article 11 The funds necessary for auditing organs to implement their functions shall be included into the government budgets and be guaranteed by the people's government at the same level.

Article 12 Auditors shall possess the professional knowledge and ability suitable for the audit work they are engaged in.

Article 13 An auditor shall withdraw if he has interests with the entity under audit or the audited items in conducting audit matters.

Article 14 An auditor shall have the responsibility for keeping to themselves the State secrets and the business secrets of the entity being audited he has access to when carrying out his functions.

Article 15 An auditor shall be protected by law when carrying out his functions in the light of the law.
No organization or individual may refuse or obstruct auditors' performance of their functions in the light of the law, or retaliate against auditors.
The persons-in-charge of the auditing organs shall be appointed or dismissed in the light of statutory procedures.
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