1、Overview of National Situation and Government Auditing in China,Presented by Dr.DONG Dasheng October 2008,Overview of Government Auditing in China,China Factfile,Main Contents,1,2,China Factfile,1,China in BriefPolitical SystemEconomy,China,Geographic Location：Eastern Asia, West Coast of Pacific Oce
2、an,Population: about 1.32 Billion(HK, Macao and Taiwan excluded),Total Area:about 9.6 million km,Administrative Divisions: 34 (HK, Macao and Taiwan included),Ethnic Groups: a united multi-ethnic nation of 56 ethnic groups,Political System,1,The System of Peoples Congress,5,The System of Self-governm
3、ent of Ethnic Autonomous Areas,The System of Chinese PeoplesPolitical Consultation,The Administrative System,The Judicial System,3,The Constitution of China stipulates that the Peoples Republic of China implements the System of Peoples Congress, “All power in the Peoples Republic of China belongs to
4、 the people.The National Peoples Congress and the local peoples congresses at various levels are the organs through which the people exercise state power.” The system of peoples congress is an organizational form for the state power (peoples democratic dictatorship) in China. It is Chinas fundamenta
5、l political system. The National Peoples Congress is the highest organ of state power. Local peoples congresses are local organs of state power. The National Peoples Congress (NPC) and local peoples congresses are established through democratic elections, responsible to and supervised by the people.
6、 State administrative, judicial and procuratorial organs are created by, responsible to and supervised by the peoples congresses. The NPC is elected for a term of five years and meets in session once a year. When the National Peoples Congress is not in session, its permanent body, the Standing Commi
7、ttee of the National Peoples Congress shall exercise the supreme state power. The Standing Committee of the National Peoples Congress is composed of the chairman, the vice chairmen, the secretary-general and the members.,1,The System of Peoples Congress,1,The System of Peoples Congress (continued),T
8、he NPC exercises the following functions and powers: To amend the Constitution; to supervise the enforcement of the Constitution; to enact and amend basic laws governing criminal offences, civil affairs, the state organs and other matters; to examine and approve the plan for national economic and so
9、cial development and the report on its implementation; to examine and approve the state budget and the report on its implementation; to approve the establishment of provinces, autonomous regions, and municipalities directly under the Central Government; to decide on the establishment of special admi
10、nistrative regions and the systems to be instituted there; to decide on questions of war and peace; to elect or decide on the choice of, the leaders of state organs, namely, “to elect the members of the Standing Committee of NPC, to elect the President and the Vice President of the Peoples Republic
11、of China, to decide on the choice of the Premier and the other members of the State Council, to elect the Chairman of the Central Military Commission and to decide on the choice of all other members of the Central Military Commission, to elect the President of the Supreme Peoples Court, to elect the
12、 Procurator-General of the Supreme Peoples Procuratorate;” the NPC has the right to remove the above-mentioned functionaries.,The System of Chinese Peoples political consultation,2,The System of Chinese Peoples Political Consultation means the system of multi-party cooperation and political consulta
13、tion under the leadership of the Communist Party of China (CPC). The Communist Party of China and eight other political parties work in the principles of unity, cooperation and mutual supervision, and jointly participate in the great undertakings of building socialism with Chinese characteristics an
14、d promoting the reunification and rejuvenation of the country. The system of multi-party cooperation and political consultation under the leadership of the Communist Party of China is a basic political system in China and a socialist party system with Chinese characteristics. The Chinese Peoples Pol
15、itical Consultative Conference (CPPCC) is an organization of the Chinese peoples patriotic united front, an important institution of mutli-party cooperation and political consultation under the leadership of the Communist Party of China, an important form of the socialist democracy in the political
16、lives of China and the most important political and organization form of the multi-party and political consultation system under the leadership of the Communist Party of China. Major functions of the Chinese Peoples Political Consultative Conference are political consultation, democratic supervision
17、 and participation in the management and discussion of state affairs.,3,The Administrative System,The current state administrative system means: the State Council and peoples governments of provinces (autonomous regions, municipalities directly under the Central Government), cities, counties (autono
18、mous counties, cities at the levels of counties, districts under the cities, prefectures, municipal districts), towns (cities townships, ethnic townships and sumu). Under the market economy conditions, government functions include economic regulation, market supervision, public administration and pu
19、blic services . Ever since the adoption of reforms and opening up policy, China has witnessed a number of restructurings in the administrative management system and realized in a gradual way the targets of changing functions, straightening out inter-departmental relationships, improving the structur
20、e and raising efficiency in order to make innovations in the administrative system and build a service-oriented government. In the year of 2008, the new-elected government of China initiates the reform of “Big Department System” (or called super-ministries system) which mainly centers on changing th
21、e way the government functions. The so-called “Big Department System” explores ways to establish larger departments that organically integrate the functions of smaller departments and exercise an unified administration over issues concerning the similar scope of business and relevant government func
22、tions.,In China, the structure of judicial system is as follows: the judicial organization (Peoples Court), the procuratorial organization (the Peoples Procuratorate), the investigative organization (the Public Security Organization and the State Security Organization) and the judicial administrativ
23、e organization. The peoples courts of the Peoples Republic of China are the judicial organs of the state. The Peoples Republic of China establishes the Supreme Peoples Court and the peoples courts at various local levels, military courts and other special peoples courts. The higher Peoples Courts ar
24、e set up at the levels of provinces, autonomous regions and municipalities directly under the Central Government, and the Intermediate Peoples Courts and the grassroots Peoples Courts are set up at lower levels. The peoples courts exercise judicial power independently, in accordance with the provisi
25、ons of the law, and are not subject to interference by any administrative organ, public organization or individual. The peoples procuratorates of the Peoples Republic of China are state organs for legal supervision. The Peoples Republic of China establishes the Supreme Peoples Procuratorate and the
26、peoples procuratorates at various local levels, military procuratorates and other special peoples procuratorates. The peoples procuratorates exercise procuratorial power independently, in accordance with the provisions of the law, and are not subject to interference by any administrative organ, publ
27、ic organization or individual.,4,Under unified national leadership, regional autonomy is practiced in areas where people of minority ethnic groups live in compact communities of Chinese territories; in these areas organs of self-government are established to exercise the power of autonomy. The syste
28、m of self-government of ethnic autonomous areas is a political system with Chinese characteristics ensuring the minority ethnic groups to manage their own affairs and administer the right of self-government. The Peoples Republic of China has 5 autonomous regions: Inner Mongolia Autonomous Region, Xi
29、njiang Uygur Autonomous Region , Ningxia Hui Autonomous Region, Guangxi Zhuang Autonomous Region and Tibet Autonomous Region. The rights of organs of self-government of ethnic autonomous areas include: law-making power, flexiable executive rights, power of autonomy in administering finances, the sel
30、f-government right concerning languages and culture, the right to organize public security forces and the preferential employment of minority ethnic groups cadres.,5,The System of Self-government of Ethnic Autonomous Areas,A sustained fast and stable growth of national economy,Fast growth of investm
31、ent and exports andincreasing-growing consumption,Accelerated increase of market price, especially that of real estate,Stable monetary situation and continuous active capital market,Relatively fast growth of government financial revenues,Economy in 2007,A sustained fast growth of GDPGDP enjoys a sus
32、tained fast growth. The GDP of 2007 amounts to 24661.9 billion RMB (about 3000 Billion USD), 11.4% higher than the previous year and 0.3% more that the growth rate of the previous year. For five consecutives years, the growth rate reaches or exceeds 10%.,A sustained stable development of agriculture
33、 productionIn 2007, the total grain production reaches 501.5 million tons, 3.5 million tons more than the previous year with a growth rate of 0.7%.,An accelerated growth of industry productionIn 2007, the total industry added value reaches 10736.7 billion RMB with a growth rate of 13.5%. The growth
34、rate of large-scale industry added vale amounts to 18.5%,A sustained fast and stable growth of national economy,Relatively fast growth of investmentIn 2007 the social investment of fixed assets totals 13723.9 billion RMB with a growth rate of 24.8%, 0.9% more than that of the previous year. The city
35、 and township investment of fixed assets reachs 11741.4 billion RMB, with a growth rate of 25.8%, 1.5% more than that of the previous year.,Relatively fast and stable growth of exportsIn 2007, the total volume of annul imports and exports reaches 2173.8 billion USD, with a growth rate of 23.5%，0.3%
36、less than that of the previous year. The exports volume is 1218 billion USD, with a growth rate of 25.7%, 1.5% less than that of the previous year. The imports volume is 955.8 billion USD, with a growth rate of 20.8%, 0.8% more than that of the previous year. The surplus reaches 262.2 billion USD, 8
37、4.7 Billion USD more than the previous year.,Gradually accelerated growth of consumptionIn 2007, Retail sales of consumer goods totals 8921 billion RMB0, with a growth rate of 16.8% and 3.1% more than that of the previous year.,Fast growth of investment and exports andincreasing-growing consumption,
38、Sharp increase of consumer price Consumer price index (CPI) increases with a rate of 4.8%, 3.3% more than that of the previous year, recording the highest growth rate since 1997,Relatively fast increase of Real Estate priceIn 2007, the sale price of houses in 70 large and medium cities increases by
39、7.6%, 2.1% more than the growth rate of the previous year. The price of (economically) affordable housing increases 2.5%, 1.2% less than the growth rate of the previous year. The price of ordinary housing increases 8.6%, 2.7 % more than the growth rate of the previous year. The price of top grade co
40、mmercial housing increases 9.2%, 1.5% more than the growth rate of the previous year.,Accelerated increase of market price, especially that of real estate,Increase of price growth rate of Upstream products,Producer price index (PPI) increases with the rate of 3.1%, 0.1% more than that of the previou
41、s year,Relatively fast growth of Monetary Aggregates and loansBy the end of Dec. 2007, M2 reaches 40300 billion RMB, with a growth rate of 16.7%. Compared with the volume at the beginning of the year, RMB Loans of monetary institutions increase by 3632.3 billion RMB.,RMB Appreciation and Fast Increa
42、se of Foreign Exchange ReserveBy the end of Dec. 2007, 1 USD equals to 7.3046 RMB, recording the accumulated appreciation of RMB by 6.9%. By the end of Dec. 2007, Foreign Exchange Reserve reaches 1530 billion USD. For the whole year, foreign exchange reserve increases by 461.9 billion USD.,Surging o
43、f Stock Exchange Index and a more active futures marketBy the end of 2007, Shanghai（securities）Composite Index reaches 5262, with a growth rate of 96.7%；Shenzhen Stock Exchange Component Index reaches 17701, with a growth rate of 166.3%.,Stable monetary situation and continuous active capital market
44、,In 2007, total government financial revenues reach 5130.403 billion RMB, with a growth of 1254.383 billion RMB and a growth rate of 32.4%.,Relatively fast growth of government financial revenues,Sub-prime Mortgage or financial Crisis in US,?,Economy slump and Inflation,Depreciation of USD,Shortage
45、of Grains supply,Surging of Oil Price,Decreased Growth of Exports, Price Increases Downward Turning of Real Estate Market Steep Decline of Stock Market Snow and Ice Storms Wenchuan Earthquake,?,What happens in the Chinese economy in 2008,the Chinese government has put forward in the beginning of 200
46、8 that the task for macroeconomic regulation is to “prevent fast economic growth from becoming overheated growth and keep structural price increases from turning into significant inflation”,In view of the current economic situation, the Chinese government has listed the the primary task for macroeco
47、nomic regulation is to “keep a steady and repid development and bring price increases under control” in the second half of 2008,In the first half of 2008, China enjoys a steady and rapid economic development. The growth rate of GDP decreases as in the first half of 2008 GDP amounts to 13061.9 billio
48、n RMB with a growth rate of 10.4%. Government financial revenues continues a rapid development though upward pressure on prices will remain great this year.,2,Overview of Government Auditing in China, History Legal Status Audit System Duties and responsibilities Built-in Departments Audit Procedures
49、 Audit Work Future Orientation,Auditing in Ancient China,Auditing in P.R. China,1. Originated as early as Western Zhou Dynasty 2. A system of Shangji in Qin Dynasty and Han Dynasty 3. Bibu Department in Sui Dynasty and Tang Dynasty 4. A royal audit court was set up in Song Dynasty 5. Yuan Dynasty, Ming Dynasty and Qing Dynasty: Institution of Censor and Inspector6. the Government of Northern Warlords set up Chamber of Audit and issued Audit Law, which was followed suit by the Kuomintang Government,
