China Works on New Auditing System

BEIJING, August 1 (Xinhua) -- China's auditors are urged to develop sharper eyes to comply with or benefit from new rules of responsibility under consideration at the National Audit Office.

Today's Business Weekly of China Daily quoted Auditor-General Li Jinhua as saying that the office is working on a new auditing system, which includes auditing principles, regulations concerning incentives for auditors and rules of responsibility to improve the quality of audits.

He said that the auditing is an increasingly important tool for the supervision of the national economy and a powerful weapon in the fight against corruption.

"If auditors fail to find problems which turn up years later, they must bear responsibility," said Li.
Responsibility rules are expected to be developed during 2001, and auditing principles are being drafted and will go into effected by the end of next year.

Rules concerning incentives for those who discover cases involving big embezzlements and illegal activities have already been set up. And rules defining responsibilities are under serious consideration.

Li said if auditors obey the principles, but still fail to discover problems, they should not bear unlimited responsibilities, because the system aims not only to make auditors more responsible, but to protect them.

He also highlighted the importance of applying advanced means such as computer technologies to improve auditing efficiency.

According to Li, Chinese auditors face such thorny problems as local protectionism, which hampers auditing and the publicizing of auditing reports. Loose financial discipline and fabricated accounting information also creates hotbeds for corruption.