Pursuant to Article 39 of the Accounting Law No. 88/2015/ QH13 approved by the National Assembly of Vietnam on November 20, 2015

Pursuant to Decree 05/2019/ ND-CP approved by the Vietnamese Government on January 22, 2019

Internal control: is the building and implementation organizing in enterprise itself on internal regimes, policies, processes, regulations in accordance with the regulations of law to prevent, find out, solve promptly the risks and achieve the planned requirements.

The accounting department must build the internal control system for the enterprise to satisfy the following requirements:

– The assets of the enterprise must be guaranteed to be safe and avoid using for wrong purposes and ineffectiveness;

– The transactions (activities) are approved by the competent authority and fully recorded as the basis for making and presenting financial statements truthfully and logically.

Internal audit: is the checking, evaluation, supervision of the adequacy, logic (suitability) and effectiveness of internal control.

The assignment of internal audit are as follows:

– Checking the suitability, validity and effectiveness of the internal control system;

– Checking and confirming the quality and reliability of economic and financial informations of financial statements and management accounting reports before submitting them for approval;

– Checking the compliance with operation and management principles, compliance with laws, financial and accounting regimes, policies, resolutions and decisions of the managers of the accounting department and of the enterprise;

– Finding out loopholes, weaknesses, frauds in the management and protection of the properties of enterprise; proposing solutions to improve the management and operating system of the accounting department.

Building effective internal control system is not only the problem of accounting field. In fact, the operating expression of internal control system is reflected in the ability to implement and self-control risks of all departments in the enterprise; reflected in the building, promulgation and implementation the management regulations such as: Charter of organization and operation, Financial regulations, Regulations on functions and responsibilities of departments, Regulation of salary and bonus distribution, Labor regulations, Regulation of business-trip expenses, Welfare regulation, Regulations for fire prevention, Job description of each position …

In fact, the internal audit should implement periodically to re-check the effectiveness of the Internal Control System. For Startups expect to mobilize capital, the result report of internal audit is obligatory condition that investors are required when they are interested in project of enterprise.