The auditing supervision system in China can be traced to the beginning days of the dynasties.
--As early as Western Zhou Dynasty, about 3,000 years from now, an official position named as Zaifu was established with the function of performing audit duties and regarded as a rudimentary form of auditing in China.
--Both in Qin Dynasty and Han Dynasty, a system of Shangji was adopted in China and the government intensified its supervision over economic activities.
--During Sui Dynasty and Tang Dynasty, an agency named Bi Department was established under the Ministry of Justice, by which relatively independent audit institutions were set up.
--A royal audit court was set up in Song Dynasty in 992 A.D, which was the first time when audit institutions were officially named with the formal appearance of the term “audit”.
--No special audit institutions were established during Yuan Dynasty, Ming Dynasty and Qing Dynasty. The duties of auditing supervision were performed by the Institution of Censor and Inspector.
--After the Revolution of 1911, the Government of Northern Warlords established its Audit Court, which was followed suit by the Kuomintang Government in Nanjing set up Chamber of Audit and issued Audit Law.
During the Second Revolutionary Civil War period, the system of auditing supervision was also put into effect in the revolutionary base areas under the leadership of Communist Party of China.
--In 1932, the Audit Committee of the Central Soviet Government was set up in the Central Revolutionary Base area.
--In 1934, the Central Government of the Chinese Soviet Republic promulgated Audit provisions, stipulating duties, powers, audit procedures and audit rules of audit institutions in the Chinese Soviet Republic. This is the first comprehensive audit law issued by the Central Soviet area.
--There were no independent government audit institutions in the first 34 years from October 1949 to August 1983 after the founding of the People’s Republic of China. The control of state revenues and expenditures was conducted by internal supervisory bodies of departments of public finance.
--The Constitution of the People’s Republic of China promulgated and came into effect on December 4th,1982 stipulates the adoption of auditing and supervisory system in China.
--In September, 1983, the National Audit Office of the People’s Republic of China (hereafter referred to as the CNAO) was established and became the ministry under the State Council, with provincial, municipal and county people’s governments setting up their local audit institutions in succession and audit carried out gradually all over the country.
--In August 1994, Audit Law of the People’s Republic of China was formally promulgated and entered into force as of January 1, 1995.
--On October 21, 1997, the Implementation Rules for the Audit Law of the People’s Republic of China were promulgated by the State Council.
--On February 28th, 2006, the amended Audit Law of the People’s Republic of China was formally promulgated and entered into force as of June 1, 2006.
Since the establishment of the audit institutions in 1983, especially with the promulgation of Audit Law of the People’s Republic of China, the building of audit regulatory framework, the expansion of the audit scope, the compilation of audit standards and the exploration of audit means and approaches, auditing in China has gradually taken the path of legalization, systematization and standardization and played positive roles in increasing revenues and decreasing expenditures, improving macro-management, strengthening administration by law, protecting the benefits and interests of citizens, and building clean government.
