Tiếng Việt
中文The internal audit division of a securities investment fund management company is under the Board of Directors or the Board of Members or the company owner (Clause 1, Article 5 of Circular 99/2020/TT-BTC). A fund management company must report internal audit results annually to the State Securities Commission (Point d, Clause 1, Article 29 of Circular 99/2020/TT-BTC).
1. Under which board is the internal audit division of a fund management company?
Under Clause 1, Article 5 of Circular 99/2020/TT-BTC, a fund management company that is a public company or manages public funds or public securities investment companies must establish an internal audit division. The internal audit division is under the Board of Directors or the Board of Members or the company owner (depending on the organizational model of the fund management company).
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2. What are the responsibilities of the internal audit division?
Under Clause 2, Article 5 of Circular 99/2020/TT-BTC, the internal audit division is responsible for:
– Inspecting and evaluating the organizational structure, corporate governance, administration, and coordination of each division and each working position to prevent conflicts of interest and protect clients’ interests;
– Inspecting and evaluating the adequacy, effectiveness and efficiency of, and compliance with, the law, the company charter, the internal control system, and internal policies and procedures (professional ethics, operations, risk management, information technology, accounting, reporting, information disclosure, receipt and handling of client denunciations and complaints);
– Inspecting the validity, legality, truthfulness, prudence, and compliance with operational procedures and risk management;
– Performing operational audits under the annual internal audit plan approved by the Board of Directors (or the Board of Members or the company owner); activities, processes and divisions with high risk levels are audited at least once a year.
3. Does a fund management company report internal audit results annually or quarterly?
Annually. Under Point d, Clause 1, Article 29 of Circular 99/2020/TT-BTC, a fund management company sends the State Securities Commission annual internal audit result reports and annual internal control reports. In addition, the fund management company sends other periodic reports: monthly and annual reports on operations; monthly reports on portfolio management activities; 6-month and annual reports on risk management activities.
Notes on applying current legal provisions
Circular 99/2020/TT-BTC guides the operations of securities investment fund management companies. Companies should check the latest text before applying. Where legal advice is needed on fund management company operations, you should contact an ANT Legal lawyer at 0966.475.966.
Common risks to note
Failing to establish an internal audit division or to report annual internal audit results to the State Securities Commission may result in administrative sanctions in the securities sector.
How can ANT Legal help?
ANT Legal supports legal advice on securities, fund management, and building internal control and internal audit systems.
For quick advice, you may contact a lawyer at 0966.475.966.
