Kingdom of Cambodia
Nation Religion
King
We,
Preah Bat Samdech Norodom
Sihanouk,
King of the Kingdom of
Cambodia,
-
Having seen
the Constitution of the Kingdom of Cambodia;
-
Having seen
the Kram NS/RKM/0399/01 dated June 08, 1999, promulgating the Constitutional law
regarding the amendments to Articles 11, 12, 13, 18, 22, 24, 26, 28, 30, 34, 51,
90, 91, 93 and Articles in Chapter 8 through Chapter 14 of the Constitution of
the Kingdom of Cambodia;
-
Having seen
the Kret NS/RKT/1198/72 dated November 30, 1998 regarding the Appointment of the
Royal Government of Cambodia;
-
Having seen
the Kram 02/NS/94 dated January 20, 1994, promulgating the Law on the
Establishment and Organization of the Council of
Ministers;
-
Having seen
the Kram 01/NS/93 dated December 28, 1993, promulgating the Law on Financial
System;
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Having seen
the Kram NS/RKM/1096/18 dated January 24, 1996, promulgating the Law on the
Establishment of the Ministry of Justice;
-
Pursuant to
the proposal of Samdech Prime Minister and the Senior Minister and Minister of
Economy and Finance;
The
Law on Audit of the Kingdom of Cambodia enacted by the National Assembly on the
12th of January 2000 at its plenary session of the second legislature
and entirely approved by the Senate on its form and legal concepts on the 21st
of January 2000 at its second plenary session of the first legislature and was
declared constitutional, except Article 40, by the Constitutional Council and
include the following principles and provisions:
CHAPTER 1: General
Provisions
Article 1:
The purpose of this Law
shall be to establish an independent National Audit Authority. The National
Audit Authority will be responsible for executing the external auditing function
of the Government. The Auditor-General shall be empowered to conduct an audit of
transactions, accounts, systems, controls, operations and programs of government
institutions, in accordance with generally accepted auditing standards and
Government auditing standards.
This Law also provides for
the establishment of an internal auditing function in government ministries and
public enterprises.
Article 2:
The institutions that are
subject to this Law shall include ministries, agencies, authorities of national
treasury, and public financial institutions and public financial joint-ventures,
public enterprises, public establishments, municipalities, provincial and local
government offices, contractors or suppliers of goods and services to the
government under contracts, and other organizations that have received financial
assistance from the government for their equity and loans, including tax and
duty exemptions and concessions granted by the government to non-profit
organizations and private investment enterprises.
Article 3:
As used in this Law, an
external auditing shall include the undertaking of the following
audits:
(a)
Financial statement
audits;
(b)
Externally funded loans and
project administration audits;
(c)
Audits of
ministerial/institution systems and operations;
(d)
Evaluation, procurement,
performance audits;
(e)
Audits of non-profit
organizations, associations, political parties, private investment enterprises
as stipulated in Article 2 of this Law;
(f)
Audits of private investment
organizations; and
(g)
Special request
audits.
Article 4:
External auditing is an
examination or review of the accounting records, systems, operations and
controls of government institutions, in accordance with generally accepted
auditing standards and government auditing standards in order to ensure
that:
(a)
The financial and economic
activities are fairly presented in statements and reports;
(b)
Such activities were
performed in accordance with generally accepted accounting
principles;
(c)
The controls, procedures and
practices are adequate to assure compliance with laws, regulations, agreements,
systems, contracts, programs and other criteria related to revenues,
expenditures and application of government resources.
CHAPTER 2: Types of
Audits
Article 5:
An audit of the financial
statements and reports of ministries and institutions which form the basis of
the government's consolidated financial statement, at the end of each financial
year, which shall be prepared by the Ministry of Justice before presentation to
the legislative body.
An audit to the accuracy,
completeness, authorization, validation and consistency of the financial data
appearing on the statements of ministries and institutions and the government's
consolidated financial statements.
An audit to the financial
statement of public enterprise or authorities comprising of balance sheet,
profit and loss statement and statements of accounts forming part of the
financial statements. Such audit shall cover the financial statements of
business enterprises of the ministries, institutions, and municipalities,
provincial and local government agencies.
Article 6:
An audit of the financial
statements and reports required by international aid agencies and lenders under
the external funding projects. Such audit shall illustrate the appropriateness
and accuracy of receipts for drawing and the payments/expenditure for each
project enclosed by an illustrated minutes of compliance with the terms and
conditions of the loan and project agreements. The audit shall further evaluate
achievement of objectives of projects after their
completion.
Article 7:
An audit of the system is to
form an opinion on the adequacy of controls in the system and process, which is
established by an institution that managed such activities and
operations.
Article 8:
A functional or crosscutting
audits are to ensure that the activities and operations related to a function
within government institutions are being conducted in a manner that complies
with applicable laws, regulations and policies. Such audits inter alias include
public procurement, personnel payroll, contracts, management of public property
and travel.
Article 9:
The audits shall be
undertaken to assess the government's economy, efficiency and effectiveness of
operations and program outcomes. These audits shall include a review or
examination of any aspect of any operation public institutions, whether or not
it is a financial institution.
Article 10:
The compliance audits shall
be undertaken over the operations of non-profit organizations and associations,
political parties, which have received financial assistance from the government
in the form of exemptions from customs duties, income tax, any form of tax as
well as other privileges, and immunities which has not been provided by the law.
The objective of such audit is to ensure that the government is not being
deprived of revenue associated with the exemptions granted by abuse thereof and
that the institution is conducting its affairs within the framework of its
purpose.
Article 11:
The compliance audits on
private investment enterprises that have received exemptions and/or concessions
from the Royal Government of Cambodia to exploit the natural resources in the
Kingdom of Cambodia. Such audits will focus on compliance with the agreements
and the terms and conditions of the government approvals.
Article 12:
The audits at the request of
the Finance and Banking Committee of the National Assembly, National Assembly,
Senate or ministries/institutions or authority for a special review of some or
all areas of any aspect of their own operations. The implementation of such
audits shall be at the discretion of the Auditor-General.
Article 13:
The audits covered in
Articles 5 through 12 shall be undertaken by a National Auditor
Authority.
CHAPTER 3: The National
Audit Authority (NAA)
Article
14:
The National Audit Authority
is an independent, public entity and shall report directly to the National
Assembly, Senate and to the government for purpose of giving information. One
Auditor-General who shall be assisted by two Deputy Auditor-Generals shall
govern the National Audit Authority.
Article 15:
In order to accomplish its
mission and enforce this Law, the National Audit Authority is empowered to issue
decisions, regulations, circulars, and other instructions.
Article 16:
The staff of the National
Audit Authority shall have its own separate statute.
Article 17:
The National Audit Authority
shall have its own separate budget provided by the National Budget. The revenues
and expenditures of the National Audit Authority shall be subject to the Law on
Financial System.
CHAPTER 4: Appointment of
the Auditor-General
And Deputy
Auditor-Generals
Article 18:
The Auditor-General and the
two Deputy Auditor-Generals shall be appointed by a Royal Decree at the
recommendation of the Government and approved by a two-third-majority vote of
the whole National Assembly members.
The appointment of the
Auditor-General and the Deputy Auditor-Generals shall be for a term of five (5)
years and can be re-appointed upon the expiration of the first term of office
for another five-year term with no further reappointment after the second
term.
In case of death,
resignation, disability, gross mistake of the Auditor-General or the Deputy
Auditor-Generals, the new Auditor-General and Deputy Auditor-Generals shall be
appointed for such vacancy under the provisions of this
law.
The Auditor-General shall
have a rank and privilege equivalent to that of a Senior Minister and the Deputy
Auditor-General shall have a rank equivalent to that of a
Minister.
Article
19:
The candidates for an
appointment to be Auditor-General and Deputy Auditor-General must be dignitaries
who have:
-
Cambodian nationality at
birth;
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At least forty (40) years of
age;
-
Degree of higher education
or equivalent degree accounting or economics or finance or law or commerce with
a proper certification;
-
Professional or working
experience at least ten (10) years; and
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No position in the governing
body of any political party.
Article
20:
The Auditor-General shall
serve as the chief executive officer of the National Audit Authority and be
responsible for the execution of its policy, direction and objectives and have
an authority to act all matters that are stipulated in this
Law.
Article
21:
The Auditor-General shall
appoint, replace, and apply sanctions to the civil servants and staff of the
National Audit Authority and determine their salaries, fringe benefits,
allowance and bonus.
CHAPTER 5: Auditing
Reports
Article 22:
The government shall submit
the documents of settlement of annual budget to the National Assembly and Senate
for their examination and approval, and at the same time the government shall
also submit these statements to the National Audit Authority for auditing. The
National Audit Authority must certify these statements and report to the
National Assembly and the Senate.
Article 23:
If the government failed to
submit the statements of settlement budget to the National Audit Authority
within a period of nine (9) months after the close of the financial year, the
Auditor-General shall report such failure to the National Assembly and
Senate.
Article 24:
If at any time it appears to
the Auditor-General that any serious irregularities have occurred in the
accounting or custody of public moneys or public assets in the entity, the
Auditor-General shall immediately bring the matter to the attention of the
National Assembly, the Senate and Council of Ministers, Ministry of Justice and
the related ministries.
Article 25:
The Auditor-General prepare
reports and in accordance with the provisions of this Law or otherwise make
general comment upon all matters relating to public accounts, moneys and public
assets and liabilities.
Article 26:
Notwithstanding any
provision of any other law that relates to audit, where the Auditor-General
audits the accounts of any other authority or body he/she shall issue a
certificate and reports that he/she thinks necessary for such accounts to the
head of that authority or body and to the National Assembly, the Senate and
other relevant ministries.
Article 27:
The Auditor-General shall
regularly submit a report to the National Assembly and the Senate upon any
matter arising out of the performance of duties or the exercise of any of
his/her powers under this Law.
Article 28:
In respect of performance
audits conducted by the Auditor-General, after preparing a proposed report on an
audit, the Auditor-General must give a copy of the proposed report to the head
of the government institution. If the head of the government institution gives
written comments to the Auditor-General within twenty-eight (28) days after
receiving the proposed report, the Auditor-General must consider those comments
before preparing a final report. Otherwise, if the head of such institution has
not replied during the time period specified above, the proposed reports shall
be considered as the valid reports.
Article 29:
The reports issued by the
Auditor-General shall be deemed to be public documents.
CHAPTER 6: Information
Gathering Powers
Article 30:
The Auditor-General may, by
written notice, direct to the head or representative of the relevant institution
to:
(a)
Provide the Auditor-General
authorized official with any required information;
(b)
An "authorized official"
means an official who is authorized by the Auditor-General, in writing, to
exercise powers or perform functions under Chapter 6 of this
Law;
(c)
Attend and give evidence
before the Auditor-General or an authorized official;
(d)
Produce to the
Auditor-General or an authorized official any documents in the custody or under
the control of the head or representative of such relevant
institution.
Article 31:
The Auditor-General may
direct that:
(a)
To provide information
either orally or in writing and legally certified as accurate;
and
(b)
The Auditor-General has the
rights have the information and all submitted evidence certified as
true.
Article 32:
The Auditor-General or an
authorized official:
(a)
May, at any business hours,
enter and remain on any entity to be audited (auditee);
(b)
Shall be entitled to full
and free access to any documents, reports or property belonging to such
Government ministry/institution;
(c)
May examine, make copies of
or take extracts from any document or reports.
Article 33:
Prior to entry or remaining
in premises occupied by auditor, an authorized official shall show such auditor
the written authorization signed by the Auditor-General. The auditor must
provide the authorized official with all reasonable facilities for the effective
exercise of the audit.
Article 34:
A person is prohibited from
making false statements whether in an oral or written
report.
CHAPTER 7: Confidentiality
of Information
Article 35:
If an authorized official
has obtained information directly or indirectly in the course of performing a
function under this Law, such official must not disclose, divulge or communicate
the information except in the course of performing an internal function of the
National Audit Authority.
Article 36:
The restriction in Article
35 of this Law shall not prevent the Auditor-General from making, divulging or
communicating his/her conclusions, observations or recommendations in any
report.
Article 37:
The Auditor-General must not
include a detail information in a public report if:
(a)
The Auditor-General is of
the opinion that disclosure of such information would be contrary to the public
interest for any of the reasons set out Article 38 of this Law;
or
(b)
The Royal Government has
issued a certificate to the Auditor-General stating that disclosure of the
information would be contrary to the public interest for any of the reasons set
out Article 38 of this Law;
Article 38:
For the purpose of Article
37 of this Law, the following reasons shall be treated as information that would
be contrary to the public interest:
(a)
It would prejudice the
security, defense, integrity, or international relations of the Kingdom of
Cambodia;
(b)
It would unfairly prejudice
the commercial interest of any legal entity or person.
Article 39:
Under Article 37 of this
Law, the Auditor-General may decide:
(a)
Not to prepare a report for
public disclosure; or
(b)
To omit detailed information
from a public report;
However, the Auditor-General
shall include the detailed information restricted under Article 37 of this Law
into a report to be submitted to the National Assembly, the Senate and or other
relevant ministries.
CHAPTER 8: Audit of the
National Audit Authority
Article 40:
In case of emergency, the
Finance and Banking Committee of the National Assembly shall select an
independent Auditor to review the activities and operations of the National
Audit Authority.
SECTION 9: The Establishment
of Internal Audit Function
Article 41:
An Internal Audit Department
shall be established within each ministry and state enterprise. The Internal
Audit Department shall report to its head of ministry, institution and public
enterprise and shall submit its report and conclusion of each audit assignment
to the National Audit Authority. The procedures for the organization and
functioning of the Internal Audit Function shall be determined by a
Sub-Decree.
Article 42:
Internal Auditing is an
independent function to examine and evaluate the effectiveness, economy and
efficiency of the systems of internal controls established within the
institution, ministry and enterprise.
Article 43:
Internal Control System is a
process effected by government and management body within the institution,
ministry and public enterprise, designed to provide reasonable assurance
regarding the achievement of objectives in the following
categories:
(a)
Effectiveness of
operations;
(b)
Reliability of financial
reporting; and
(c)
Compliance with applicable
laws, regulations, policies, procedures, and arrangements
SECTION 10: Penalties
Article 44:
Regardless of any other
possible penalties, any person who violates Articles 31 or 33 of this Law shall
be liable to a fine from one million (1,000,000) Riel to five million
(5,000,000) Riel or imprisonment for a term from one (1) to three (3) months or
both.
Article 45:
Regardless of any other
possible penalties, any person who violates Article 34 of this law shall be
liable to a fine of five millions (5,000,000) Riel or more or imprisonment for a
term from one (1) to five (5) years or both.
SECTION 11: Final
Provisions
Article 46:
All provisions contrary to
this Law shall be abrogated.
Article 47:
This Law is declared to be
urgent.
The
National Assembly of the Kingdom of Cambodia adopts this on January 12, 2000 at
its third session of the second legislature.
Phnom Penh, January 13,
2000