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Wednesday, 25 February 2009
Auditor General Calls for Political Reform
Liu Jiayi, China’s Auditor General, said business violations in 2008 were not standalone cases but rooted in common problems in China’s political system.
Liu Jiayi, China’s Auditor General, said business violations in 2008 were not standalone cases but rooted in common problems in China’s political system.
By staff reporter Zhang Yuzhe, Caijing 23 February 2009
The National Audit Office’s mission in 2009 is to strengthen the auditing of financial institutions, said Auditor General Liu Jiayi at the State Council’s press conference on February 19. Auditor General Liu also called for political reforms, saying that China must reform its political system in order to eliminate regulatory violations in the business sector.
Liu said that economic violations inspected by the National Audit Office every year reveal problems in China’s governance. “[The violations] are not individual cases but a result of common problems in our [political] system,” Liu said. “These are not violations that we can get rid of through auditing. Instead, we must reform our system, which is a gradual process.”
According to Liu, 20 business violations involving a total of 6 billion yuan were inspected in 2008. Ten cases involved China’s three largest commercial banks, ICBC, Bank of China, and China Construction Bank. According to the auditing results, local branches have relatively poor risk management. Some credit issuers with personal connections to borrowers lower quality control standards when issuing credit to those borrowers.
After these cases were inspected, the majority of the capital was returned and violators were charged. More than 34,000 cadres and 387 staff were discovered by the National Audit Office to have violated business regulations in 2008 and were brought to disciplinary and inspection organs.
According to Liu, the National Audit Office has audited investment projects to ensure that the state’s 4 trillion yuan economic stimulus plan will be executed effectively. So far, no major violations or inefficiencies have been found.
Liu said in 2009 the National Audit Office will strengthen the auditing of major investments, environment protection programs, and welfare and public emergency projects.
Also, the state auditor will review Hong Kong-based Chinese financial institutions to protect state-owned assets.
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Auditor General Calls for Political Reform
Liu Jiayi, China’s Auditor General, said business violations in 2008 were not standalone cases but rooted in common problems in China’s political system.
By staff reporter Zhang Yuzhe, Caijing
23 February 2009
The National Audit Office’s mission in 2009 is to strengthen the auditing of financial institutions, said Auditor General Liu Jiayi at the State Council’s press conference on February 19. Auditor General Liu also called for political reforms, saying that China must reform its political system in order to eliminate regulatory violations in the business sector.
Liu said that economic violations inspected by the National Audit Office every year reveal problems in China’s governance. “[The violations] are not individual cases but a result of common problems in our [political] system,” Liu said. “These are not violations that we can get rid of through auditing. Instead, we must reform our system, which is a gradual process.”
According to Liu, 20 business violations involving a total of 6 billion yuan were inspected in 2008. Ten cases involved China’s three largest commercial banks, ICBC, Bank of China, and China Construction Bank. According to the auditing results, local branches have relatively poor risk management. Some credit issuers with personal connections to borrowers lower quality control standards when issuing credit to those borrowers.
After these cases were inspected, the majority of the capital was returned and violators were charged. More than 34,000 cadres and 387 staff were discovered by the National Audit Office to have violated business regulations in 2008 and were brought to disciplinary and inspection organs.
According to Liu, the National Audit Office has audited investment projects to ensure that the state’s 4 trillion yuan economic stimulus plan will be executed effectively. So far, no major violations or inefficiencies have been found.
Liu said in 2009 the National Audit Office will strengthen the auditing of major investments, environment protection programs, and welfare and public emergency projects.
Also, the state auditor will review Hong Kong-based Chinese financial institutions to protect state-owned assets.
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