Measures to Ensure Independence of Audit Team Members

15. What services and reports are required and the completion date of the 2012 Financial Reporting Services

Report required: Audited financial statements from January 1, 2012 to December 31, 2012

16. Describe why the business wants audited financial statements and the stakeholders who need to use those financial statements.

Make the financial situation of the business transparent. Stakeholders need to use: Banks, Taxes

II. AUDIT PROCEDURES

Have	Are not
Events of the current year
The company has a full staff of qualified, experienced and the resources needed to continue serving customers.	V
Any doubts arising during the course of work related to to the integrity of the board of directors.		V
There are limitations on the scope of the audit that result in exceptions in the report. this year's audit report		V
Is there any sign of a repeat of similar restrictions? in the future no.		V
Was the previous year's audit report exempted?		V
There is doubt about the customer's ability to continue operations		V
Fees
Total fees from customers account for a large portion of total revenue of the Company		V
Do customer fees make up a large portion of member income? The Board of Directors is in charge of the audit contract.		V
Are there any fees that have been overdue for too long?		V
Customer Relations
The firm or a member of the audit team, within the scope of its expertise subject to any dispute involving the client		V
Board Member in charge of audit contract and chief Audit team has participated in the audit team for more than 3 consecutive years		V
A member of the Company's Board of Directors or a member of the audit team may family or personal relationships, close economic relationships with		V

Maybe you are interested!

Building and Strengthening the Professional Capacity of the State Audit Team
Perfecting the process and organization of internal audit apparatus in Vietnamese state-owned commercial banks - 20
Performance audit enhances the role of State Audit in public finance and asset management in Vietnam - 3
Current Practices of Auditing and Using Audit Reports in Vietnam.
Factors Affecting the Quality of Auditing Financial Statements of Banks Conducted by the State Audit Office

customers, employees or the customer's board of directors

The firm or a member of the audit team is a member of the fund.

hold customer shares

Are any of the following currently employees or directors of the client:

- members of the audit team (including members of the Board of Directors)

- member of the company's board of directors

- former member of the company's Board of Directors

- individuals who have close or family relationships with the above mentioned persons

	V
Is any member of the Board of Directors or member of the audit team about to become a member? become a customer service agent.		V
Is there a loan or guarantee, unlike the business normal business relationship between the client and the Company or a member of the audit team.		V
Conflict of interest
Is there any conflict of interest between this client and other clients? other present		V
Providing non-auditing services
Does the company provide any other services to customers that may affect affect independence		V
Other
There are other factors that make us consider declining the appointment. do audit		V

III. ASSESSMENT OF CONTRACT RISK LEVEL

Short

V. CONCLUSION

Customer retention acceptance: Yes

Source: Audited records of Van Long Company Limited in 2012

Prepare audit contract and select audit team

For each audited stage, the auditor must agree with the client on the terms of the contract before conducting the audit. These terms must be presented in writing and discussed with the client. The signed audit contract is the starting point of the audit. Based on the terms negotiated in the audit contract, An Phat Company considers the client's audit requirements to plan the audit and assign appropriate personnel for the audit. The number and quality of auditors depend on the complexity of the work, the size of the client unit and the specific requirements of each client.

Table 2.3. Audit contract

SOCIALIST REPUBLIC OF VIETNAM AUDIT COMPANY LIMITED

AND AN PHAT ACCOUNTING CONSULTING Independence - Freedom - Happiness

No: 23 HĐKT – BTC Hai Phong, August 1, 2012

AUDIT CONTRACT

Re: Auditing the annual financial statements from January 1, 2012 to December 31, 2012 of Van Long Company Limited

Pursuant to the Civil Code of the Socialist Republic of Vietnam. Pursuant to Decree No. 105/ND-CP dated March 30, 2004 of the Government promulgating regulations on independent auditing in the national economy.

Implement Vietnamese Auditing Standard No. 210 on Audit Contracts.

Parties signing the contract: PARTY A: VAN LONG COMPANY LIMITED

Representative: Mr. Tran Tuan Khanh

Position: Director

Address: An Tri – Hung Vuong – Hai Phong

Phone: 031 3798886 Fax: 031 3798884

Account: 0031000030687 at Foreign Trade Bank - Hai Phong Branch Tax code: 0200367100

PARTY B: AN PHAT AUDITING AND ACCOUNTING CONSULTING COMPANY LIMITED

Representative: Ms. Tran Thi Minh Tan

Position: Director

Address: No. 161, Bach Dang, Thuong Ly, Hong Bang, Hai Phong City Phone: 031. 3539555 Fax: 031. 3539789

Account: 3315702 – 001 at Indovina Bank – Hai Phong Branch Tax code: 0200689059

After agreement, both parties agree to sign this Contract including the following terms:

Article 1:Service content:

Party B provides Party A with the auditing service of the annual financial statements from January 1, 2012 to December 31, 2012 of Van Long Company Limited .

Article 2:Laws and standards:

The audit service is conducted in accordance with Decree No. 105/CP dated March 30, 2004 of the Government promulgating the regulations on independent auditing in the national economy, according to Vietnamese auditing standards (or international auditing standards accepted by Vietnam). These standards require Party B to plan and perform the audit to obtain reasonable assurance that the Financial Statements are free from material misstatements. The audit includes examining and performing basic tests of evidence for the items and information in the Financial Statements. The audit also includes assessing the accounting policies used, significant estimates and judgments made by the Director, as well as evaluating the overall presentation of the Financial Statements.

Article 3:Responsibilities and authorities of the parties: 3.1/ Responsibilities of Party A:

Keep and manage vouchers, accounting books, financial reports and documents related to Party A safely and confidentially according to State regulations.

Ensure to promptly and fully provide Party B with necessary information related to the audit and review including documents, accounting books, financial statements and other relevant data.

The financial statements used for auditing must be signed and officially stamped by Party A before being provided to Party B. The preparation of the financial statements and the disclosure of other information are the responsibility of the audited entity. This responsibility requires the accounting system, the internal control system, the selection and application of accounting policies and the safeguarding of the entity's assets.

Party B may request Party A to confirm in writing the assurance of the information and documents related to the audit provided to Party B. Assign Party A's staff to participate, coordinate with Party B and create favorable conditions for Party B to review all documents, accounting books and other information necessary for the audit.

3.2/ Responsibilities of Party B:

Party B ensures compliance with current auditing and accounting standards (as in Article 2).

Develop and notify Party A of the audit content and plan. Implement the audit plan in accordance with the principles of independence, objectivity and confidentiality.

Assign auditors and experts with capacity and experience to perform the audit of Financial Statements.

Article 4:Work results:

After completing the audit, Party B will provide Party A with: Audited Financial Statements from January 1, 2012 to December 31, 2012.

The management letter (if any) will address any deficiencies that need to be addressed and the auditor's recommendations for improving the accounting and internal control systems.

The audit report is made in 10 copies. Party A keeps 08 copies, Party B keeps 02 copies.

Article 5:Audit service fees and payment methods:

- Financial Statement Audit Fee is: 26,000,000 VND

VAT 10%: 2,600,000 VND

Total: 28,600,000 VND

( In words: Twenty-eight million six hundred thousand dong )

Payment method: 50% immediately after Party B starts the work. The remaining amount will be paid by Party A by bank transfer.

Article 6:Commitment to implementation and completion time:

The two parties commit to properly implementing the terms stated in the Contract. During the implementation process, if any problems arise, the two parties must notify each other and discuss and find appropriate solutions. All information must be notified directly to each party in writing at the address stated above.

The time to complete the audit of the Financial Statements is 20 days from the date the two parties set the audit.

Article 7:Validity, language and term of the Contract:

This contract is made in 04 copies and is effective from the date of full signature and seal. Each party keeps 02 copies.

This contract is valid until Party B provides Party A with the 2012 audited financial report and Party A transfers the full amount of the contract to Party B or both parties agree to cancel the contract.

AN PHAT ACCOUNTING CONSULTANCY AND AUDITING COMPANY LIMITED (APS)

Director Director

Tran Tuan Khanh Tran Thi Minh Tan

Source: Audited records of Van Long Company Limited in 2012

The audit team, including auditors and 3 audit assistants assigned to perform the audit contract, together with the review department, including department heads and deputy directors in charge, will be subject to an independent and objective inspection before providing services to customers.

Table 2.4: Measures to ensure the independence of audit team members

AN PHAT AUDITING AND ACCOUNTING CONSULTING COMPANY LIMITED

A280

	Name	Day
The performer	BAD	January 30, 2013
Reviewer 1	TTH	January 30, 2013
Reviewer 2	PHT	January 30, 2013

Customer name : Van Long Company Limited

Closing date : December 31, 2012

Content: Measures to ensure the independence of audit team members

A. OBJECTIVES

Prevent and minimize risks to ensure the independence of the Auditing Company/Auditing Team members.

B. TEST CONTENT

Procedure

Have	Are not	Are not apply
1/ Identify factors affecting the independence of the Auditing Company and the Auditing Team. maths:
a. Audit team members have shares and stocks of the customer		V
b. Audit team members are service providers Other guarantees for customers		V
c. Audit team members have worked for many years/or have blood relationship with customer		V
d. Does the auditing company provide other services to the client?		V
2/ Measures to ensure the independence of audit team members
a. Using separate Board of Directors/members with Audit Group	V
b. Use of Board of Directors members and separate members with The department providing services to customers has conflicts.			V

about benefits

c. Discuss with customers about conflicts of interest and collect

permission to continue work.

d. Are there any changes in the Board of Directors and team leaders?

audit

e. Communicate and discuss issues of independence and the extent of non-audit work with management.

related reasons.

V
f. Use of an independent individual, as the second member of the Board of Directors or other Auditing Firm in reviewing and advising on specific issues,			V
g. Remove individuals from the audit team when found risk of affecting independence.			V
Other measures