China's Auditor-General Li
Jinhua on Thursday urged internal auditing bodies to conduct
more management audits of enterprises to improve their financial
and management performance.
At a council meeting chaired by the China Institute of Internal
Audit (CIIA) in Beijing, Li said that income and expenses audits
that only aim at correcting errors and exposing cheating cannot
meet the needs of economic development.
Internal audits should play a more important role in improving
economic growth and should provide consultation to decision makers,
Li said.
He said sustainable development stresses better internal
management and the integrated use of resources during the
transition period.
Li encouraged internal auditing bodies to take an active part in
supervising and evaluating enterprises' operating activities, risk
management and internal control.
He added that due to the lack of authenticity and legitimacy,
income and expenses audits are still two of the more effective ways
to improve financial performance.
Li said cost-effectiveness audit and management audits are key, and
highlighted that audits are both a checking and controlling
system.
The objective over the next five years for Chinese internal
auditing bodies established by the CIIA is to integrate income and
expenses audits with internal control and risk management
audits.
The CIIA was founded in 1987. There are an estimated 82,000
internal auditing bodies and more than 200,000 internal auditors in
China.
(Xinhua News Agency January 13, 2006)