CHAPTER 1:
RESEARCH OVERVIEW AND RESEARCH METHODOLOGY
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1.1 Overview of research works
1.1.1 Domestic research
The formation and development of the State Audit Office greatly affects the role of the State Audit Office in financial management and public assets. There have been many documents mentioning the State Audit Office and the role of the State Audit Office with separate perspectives in the following main directions:
Firstly, research on performance audit aims to audit and evaluate the economy, effectiveness and efficiency in the management and use of public finance and assets.
The following are typical works researched by the Authors:
The establishment of a set of factors constituting the role of the State Audit and the systematization of the State Audit's regulations on decentralization and delegation of authority between departments and the organizational structure of the audit apparatus (BMKT) has a great influence on the organization of the State Audit in Vietnam, which the author Vu Van Hoa, in 2010, pointed out through the work "Strengthening the role of performance audit in Vietnam by the State Audit". The work has core values in developing the role of the State Audit, however, at that time, the State Audit was implementing the State Audit in the form of thematic audits that the author had researched and synthesized. Since 2014, the State Audit has organized independent audits for a number of programs, projects, and development investment policies, and separated them from thematic audits. Therefore, the project still has certain gaps: (1) How should the role of the State Audit be specified and linked to the role of the State Audit in order to help the State strengthen its tools for controlling finances and the State budget; monitor financial management activities and public assets; (2) Factors in the relationship affecting the role of the State Audit through the method of organizing the State Audit to evaluate the goals of economic efficiency, effectiveness, efficiency and performance of management of programs, projects, and development investment policies always contain many potential issues that cause public concern and social opinion.
The role of performance standards in implementing the audit of activities and the criteria for evaluating activities have been instructed in the "Performance Audit Textbook" in 2009 by Author Nguyen Quang Quynh, the textbook has developed the awareness of classical theory and provided a system of performance audit criteria, tools and techniques to evaluate the economy, efficiency, effectiveness and efficiency of state budget management. As well as Author Nguyen Dinh Huu in the work "Basic Auditing" in 2004 and "Auditor's Handbook" in 2012, clearly pointed out the core issues of standards in audit activities, emphasizing
Strengthening human factors, capacity, ethics and professional qualities, in addition, the work also provides guidance on auditing methods and solutions that will enhance the role of auditing in practice. The author attaches importance to the method of auditing, forming the auditing process because this is a tool, a premise and a handbook for auditors in organizing auditing meetings. However, the factors affecting the formation and development of auditing meetings are suggested by the author to continue to develop in the gap of auditing research, including providing guidance on a set of auditing criteria to apply in organizing and implementing auditing meetings.
The research work of Author Nguyen Luong Thuyet (2020), "Organizing the audit of state budget expenditures conducted by the State Audit". The work has developed three key contents: Methods of organizing audits, procedures for implementing audits and objectives of audits based on the foundation of building a system of audit criteria that not only applies to the field of state budget expenditures but also in auditing programs, projects and development investment policies. The work has great value and has pointed out the gap that needs further research: the objectives of audits must always be developed in conjunction with the methods of organizing audits (pre-audit, current audit and post-audit) to truly enhance the role of the State Audit in the management and use of public finance and assets.
The general awareness of the role of the audit that many works have shown through three criteria used in the audit is: Economy, efficiency and effectiveness as emphasized in the textbook "Handbook of performance audit - Theory and practice" in 1999 (Stockholm). This is a principled theory that is consistent with the development direction of the audit in 2004 on "Guidelines for the implementation of performance audit" of INTOSAI, GTZ Project and provides a standard concept of the audit. The audit profession and techniques of the auditor such as "selecting audit issues, including identifying, systematizing issues, establishing audit funnels and presenting audit issues, planning audit programs". The guidance of INTOSAI, GTZ Project is most concerned with the inheritance and application of the results of state budget audits in the development of the audit that the State Audit of Vietnam must aim for in order to assess issues in the audit (problem tree). However, the gap that needs to be studied is the audit program plan, implementation of the method of organizing the audit (combined with continuous audit) of the State Audit subject to enhance the role and must be an independent institution of public power in the activities of controlling, managing, and supervising the use of public finance, ensuring the economic goals, efficiency, and effectiveness of the program and project when put into operation and operation (audit subject or audit issue, topic).
Continuous audit is the practice of auditors to prepare timely reports or summarize audit results in a short period of time, to provide written confirmation of audit results as directed by the 1999 AICPA/CICA study, the guidance document .
Continuous audit . Thus, the difference between continuous audit and traditional audit is to emphasize the continuity and timeliness of the audit, providing timely and useful information to users to improve the effectiveness and efficiency of the audit immediately after conducting monitoring, observation and supervision activities during the investment, construction and management process. Compared with traditional audit, the time to prepare continuous audit reports is significantly shortened, issues are continuously monitored and evaluated, and transferred throughout the formation and operation of the audited entity. Continuous audit reports are issued according to the information network, users can access the network to collect information when necessary. The work has shown that the implementation of continuous audit will promptly detect and prevent potential risks such as: Inherent Risk (IR), Control Risk (CR), Detection Risk (DR) and Audit Risk (AR). The gap left by the project is how continuous audit must be performed to be associated with the role of a State Audit subject to continuously control and monitor the activities of audit subjects and audit objects and provide timely information. That is, continuous audit must be performed at all input and output stages when organizing pre-audit, current audit and post-audit. The relationship between performing continuous audit to assess the objectives of the audit and the level of risk control needs to be studied.
Factors affecting the performance audit and determining the effectiveness of the organization of performance audit were studied by Author Dang Anh Tuan in 2015, in the work "Factors affecting the formation and development of performance audit in the public sector in Vietnam". The work identified 33 influencing factors and summarized four important groups of factors: Political factors; State Audit's ability factor; Auditor's skill factor and economic factors. Of the four groups of factors, two are the most important in determining the formation and development of performance audit: State Audit's ability factor and Auditor's skill factor. The author pointed out the gaps that need further research in: The nature and relationship between factors affecting the development of performance audit, affecting the role of State Audit in the context of applying and organizing performance audit in the public sector; The cause of the limitations of the State legal system, the auditing law has the influence and interaction between "supply" and "demand" of the State Audit. Also in the study on "The quality of the auditors of the State Audit" by Author Ha Thi My Dung, in 2016, it was pointed out that the human factor is the key, deciding the development of the State Audit apparatus. Thus, the gap that needs further research from the factors affecting the development of the State Audit is the standard in public service activities in general, the State Audit in particular and the Author also pointed out that the State legal system, the auditing law needs to have a stronger sanction to improve
The role of law; the issues specified from the factors studied above have what effect, the principles formed to solve what problems in the study.
Performing various types of audits in an audit and the application of any type of audit depends on the skills and profession of the auditor. Theory and practice specify three types of audits and are introduced by Author Nguyen Van Ky (2003) in the article "The combination of financial statement audit, compliance audit and performance audit in an audit of the State Audit". This is a valuable research work contributing to the understanding of the theory and types of audits in the context of not having many studies on performance audits. The work is developed on the basis of theory and practice of performance audits (1999), has shown the true value of the types of audits in the audit system, the Author clearly shows the combination of types of audits with performance audits to form a type of joint audit. However, at this time, the decentralization of state management is not synchronous, public administrative reform (PAR) still has many shortcomings and is not effective, e-Government and e-Government have not adapted, the type of economic audit has not been strongly developed. Therefore, the project has limitations in that it has not clearly specified and classified which subjects apply the economic audit type which is effective and closely linked to the effectiveness of financial management and public assets; which subjects need to apply joint audit, which subjects need independent audit, continuous audit. Thus, the research needs to focus on the issue of joint audit, continuous audit and assess the issues in auditing; assess the economy, efficiency, effectiveness and management efficiency of programs, projects, and social security policies that are of public interest.
Thus, the above studies on the evaluation of the effectiveness and efficiency of management and use of public finance and assets have pointed out certain gaps: (1) Developing the role of the evaluation is to study the method of organizing the evaluation (pre-audit, on-the-spot audit, continuous audit) with the assessment of the objectives of the evaluation (3Es); (2) Strengthening the standards of public service activities, public service ethics and institutional effectiveness, the State's legal system ensures the legality and strong sanctions in handling violations of the law in the management of public finance and assets; (3) In the evaluation, focusing on the objective of evaluating the economy, efficiency, effectiveness and efficiency of management based on the evaluation criteria (Input, output, results) of the 3Es model and applying them in independent evaluations conducted by the State Audit.
Second, research to enhance the role of State Audit in public finance and asset management through performance audits.
The goal of the State Audit is to develop its activities in a modern direction, in line with international practices and to enhance the role of the State Audit, Author Doan Xuan Tien in 2012, in the article "Strengthening operational audit to enhance the role, effectiveness and efficiency"
of the State Audit”. The author pointed out the core issues of effectiveness and efficiency in the State Audit with theoretical values referring to the role of the State Audit in organizing the State Audit in the following: Strengthening the implementation of the State Audit of projects, programs and policies that are of public interest; building a framework for regular and continuous State Audit programs; strengthening the function of assessing issues, confirming the correctness and honesty of financial reports, settlement reports, quick reports and value-for-money audits; recommending the correction and improvement of institutions and legal frameworks; strengthening the inspection of regular activities and assessing the effectiveness and efficiency of those activities. The project suggests practical and theoretical research aimed at: Strengthening the State Audit is the implementation of the goal based on evaluation criteria in the State Audit organization to enhance the role of the State Audit, which means that it is necessary to independently establish that role in the State Audit Office associated with the activities of controlling and transparently supervising the public finance and exercising the authority to consult, orient strategies, and make major decisions of the State to enhance the role, effectiveness and efficiency of the State Audit.
The role of the State Audit is considered important in public debt management reform by Author Nguyen Dang Hung (2017), in the work "The role of the State Audit in public debt management in Vietnam" as well as Author Nguyen Dinh Huu (2003), in the research work "The role of the State Audit in the reform of the State administrative system". These are research works on the role of the State Audit subject in public debt management and public administrative reform with a breakthrough nature, highlighting the role of the State Audit, aiming at a broad vision in the context of the strategic development of the State Audit apparatus at that time, there were many challenges. The author clearly pointed out the functions, tasks, and powers of the State Audit associated with the obligation of State administrative reform to help improve the quality of public service between the State Audit and the audited subjects related to many areas of the State Audit's activities. However, the research gap that the Author left due to certain limitations along with the advanced development of the country's economy as it is today is: The role of the State Audit in the reform of public administration must be associated with the supervision of public activities and financial management, public assets according to the decentralization of state management; the role of the State Audit in the change of the legal system and the State Audit Office must further strengthen the role of the State Audit apparatus as stipulated in the Constitution; the State Audit is an independent public authority with supreme authority associated with the function and role of inspecting, supervising, controlling the activities of the public administrative apparatus and consulting on public management.
The shortcomings and limitations in decentralization of local budget management have a great impact on the role of the State Audit, which Author Vu Van Hoa pointed out in 2004 through the work "Enhancing the role of the State Audit in auditing local budgets". The author pointed out the relationship between the State Audit and local authorities.
through the audit of the State budget, in which the role of the State Audit is in supervising the management of the State budget. However, there are certain gaps: The relationship in the management of the State budget in which the role of the State Audit is stopping through audit recommendations, the audit report of the State budget; the method of financial audit focuses on post-auditing the budget with the accounting values that have been approved after a cycle of implementation and budget settlement, the most important thing is to orient a roadmap for supervising the budget management activities (QLNS) at the levels of the State budget (management before, during and after activities). Thus, a certain gap shows that the role of the State Audit in the pre-budget management stage is still open and needs to be studied in depth: Researching the independent role of the State Audit associated with the role of controlling and regularly monitoring the activities of human resource management and public finance, the effectiveness of which shows a relationship with the method of organizing pre-audit, current audit combined with post-audit and the implementation of the authority to decide on consulting policies, decisions, and regimes for the government at all levels to improve the State management.
The innovation and improvement of local budget management along with the role of State Audit in auditing local budgets by the author Nguyen Thi Thanh Diep (2016), with the work "Improving local budget auditing with strengthening local budget management". The author has deeply assessed the work of local budget management associated with the role of auditing the management, auditing of public revenue and expenditure and specific public finance at each stage: Budget management, budget implementation, budget settlement and reporting. From there, the State Audit has improved the reform of auditing processes and methods, and audit reports to be more suitable to practical requirements. The work has left theoretical and practical values on the role of the State Audit in public administrative reform and State budget management. However, the remaining issue that the Author pointed out is that there needs to be a type of audit, which is to apply the State Audit to evaluate the effectiveness and efficiency of operations to help the local public financial management apparatus operate in accordance with the law, prevent loss of public funds, and make administrative reform, mechanisms and legal frameworks completely transparent and consistent. The issue with the ability to apply the achievements of the State Audit in the world to Vietnam is an essential requirement; the role of the State Audit of Vietnam has demonstrated how to consult on policies and regimes in financial management and public assets; the most important thing is that the audit before, during and after budget management activities or the State Audit subject has only stopped at the scope of post-auditing the local budget and making recommendations and assessing inherent violations, but has not been able to implement methods of control and prevention of risks right from the input stage of the management cycle.
The inspection and supervision functions of auditing agencies are formed through the different characteristics and economic and political circumstances of each country and are studied through the work of Author Nguyen Van Kim (2001), Organization and activities of inspection, examination and supervision of some countries in the world . The work has pointed out the factors of: Organization
The functions, duties, positions and powers of an inspection and supervision agency in each country depend on different economic and political characteristics, traditional views, etc.; the inspection and supervision agencies all operate independently, only comply with the law, and are independent of the inspection and supervision object; independent of the President, the National Assembly and the Government. The role of the inspection and supervision agencies is clearly demonstrated through the functions of an expert in consulting and providing strategic advice (consultation) to support public management agencies. The inspection and supervision agencies all consider the assessment of public effectiveness and the settlement of citizens' complaints, which means that a mindset towards the effectiveness of public services has been formed. The role of the inspection and supervision agencies at this time is also demonstrated through consulting on CSPL and the regime to amend and perfect the legal system. Thus, the study has shown that the State Audit is an intermediate public authority that plays a role in helping the State inspect, supervise, and control the management and operation of the treasury and public finance but operates independently. The above theoretical gap focuses on the research on the role of control and supervision of activities that must be associated with the role of the State Audit, especially in the process of organizing the State Audit, public administrative reform, and reforming the State Audit apparatus. The purpose is to enhance the legal position, functions, and powers of the State Audit, which must be institutionalized as an independent public power in the management and operation of the State's public finance and assets at all levels of management.
The premises for the development of public audit include: Completing the auditing legal system is an urgent requirement, in addition to promoting appropriate operating standards according to international practices. Author Dang Van Hai in 2014, in his thesis "Completing the law on State Audit to meet the requirements of building a socialist rule-of-law state in Vietnam", pointed out the shortcomings in the administrative reform roadmap in the State Audit and in the State Audit legal system, in the current auditing procedures and standards (CMKT) which are quite far from practical requirements and international practices. This is a practical study, boldly raising the requirements for changes in the State Audit legal system along with the innovation and development of the State Audit apparatus in Vietnam. However, the author has not yet promoted: Strong, comprehensive operating standards and sanctions to enforce the State Audit law in relation to the State law and current laws; Researching the role of the Socialist Republic of Vietnam's legal system determines the effectiveness, efficiency and power of the State Audit Law and State Law to enhance the role of the State Audit in economic activities. From there, the role of the legal system in the legal system and operating standards are applied to research and development to enrich the factors affecting the formation and development of economic activities and the role of the State Audit in management consulting to help all levels of the State improve the work of financial management and public assets.
Thus, the gaps from the above studies: (1) The State Audit organizes audit activities according to each independent and continuous audit topic in relation to the 3Es model; (2) Through continuous audit, the State Audit organizes audit activities to control and monitor inputs, outputs and results; (3) In relation to financial management and public assets, the role of the State Audit subject is studied through the role of monitoring and controlling the activities of management subjects and conducting management consultation, ensuring the provision of timely and useful information.
1.1.2 Overseas research
Firstly, research on performance audit aims to audit and evaluate the economy, effectiveness and efficiency in the management and use of public finance and assets.
KTHĐ was developed from the period 1960 - 1970, and was developed more widely until 1996, mainly in some countries such as Canada, Australia in addition to the US and UK. Authors Jean Rattegeau and Fermand Dubois (1984), Author Barzelay & associates (1996) Audit operationel have presented typical works on developing KTHĐ in the management period with the world economy having many fluctuations. Like many other works by Authors Shan, D & Anand, P (1996), Trodden. SA (1996), the work has deeply mentioned the performance of a specific audit subject, but there are many concepts with many different perspectives and applications in their own ways, the effectiveness of applying KTHĐ is also different. In the UK and Canada, the State Audit is more focused on Value For Money audit, which means auditing the effectiveness of money, capital and assets invested in a program or project, without paying more attention to the effectiveness of the program or project; in the US, the State Audit is more focused on comprehensive audit, which means auditing the economy, efficiency and effectiveness, or the so-called 3Es (Economic, efficiency and effectiveness) evaluation objectives in the State Audit. The State Audit demonstrates the role and authority of the State Audit entity, the standards and principles of auditing are formed, this is the beginning of the development of the State Audit role, helping the National Assembly and Parliament to perform the role of controlling and supervising public activities, effectively for each program or project, which is more clearly associated with the effectiveness and efficiency in managing public resources.
However, the State Audit Office has just begun to demonstrate its role in assessing the activities of a specific entity, but what influence does the role of the State Audit Office have at that time to help the National Assembly and the Government adopt tools to inspect, monitor and control the activities of the State Audit Office in the economy? This is a requirement that needs to be resolved in the context of the world economy always changing positively, the role of the State Audit Office is in a period of widespread development in SAIs around the world, so the role of the State Audit Office is being researched and developed in conjunction with the role of the State Audit Office in the following stages.