How will violations against regulations on independence be penalized?

Pursuant to Article 49, Decree 41/2018/ND-CP, violations against regulations on independence shall be penalized as follows:

1. A fine ranging from VND 10.000.000 to VND 20.000.000 shall be imposed for one of the following violations:

a) False information on and presentation of audit practitioners, auditing firms or Vietnamese branches of foreign auditing firms’ qualifications, experience and ability to provide audit services;

b) Purchasing, receiving, giving, holding audited units’ shares or capital, regardless of amount;

c) Trading bonds or other assets belonging to audited units that affect independence as specified in the accounting and audit code of ethics;

d) Receiving or demanding any kind of payment or benefit from audited units other than service fees and negotiated costs specified in the contract;

dd) Extorting, swindling the clients and audited units;

e) Interfering in the business activities of clients and audited units during the audit process;

g) Collecting debts for audited units.

2. A fine ranging from VND 20.000.000 to VND 30.000.000 shall be imposed for one of the following violations:

a) Colluding with audited units to tamper with accounting documents, financial statements, audit documents and alter audit results;

b) Forging or falsifying audit documents;

c) Carrying out auditing works in prohibited cases as specified in regulations of law;

d) Practicing audit as an individual;

dd) Working for two or more auditing firms or Vietnamese branches of foreign auditing firms at the same time;

e) Contributing capital to two or more auditing firms.

3. Additional penalty:

The audit practitioner committing any of the violations specified in Points d, e, f, Clause 2 of this Article shall have his/her certificate of audit practice registration suspended for 3-6 months from the day the decision on penalty imposition comes into effect.

4. Remedial Measure:

Return illegal profits earned by violations mentioned in Points a, b, c, Clause 2 of this Article.

As an established company in the field of tax and legal consulting, Vinasc hopes to adequately inform our customers to help them mitigate the risk during operation in Vietnam. Should there be any further concern, please contact Vinasc’s Customer Care department for timely support.