Practical Audit of Rural Collective Economic Organizations

Concept of Rural Collective Economic Auditing

Rural collective economic auditing refers to the process by which rural audit institutions and personnel at various levels, in accordance with relevant national laws, regulations, and rules, utilize auditing methods and follow legal procedures to examine and evaluate the financial revenues and expenditures, as well as the economic activities, of rural collective economic organizations and their affiliated units, as well as other rural economic entities. The goal is to ensure the authenticity, legality, and effectiveness of these activities, to evaluate economic responsibilities, and to provide an impartial conclusion based on the audit findings. This is done to enforce financial discipline, improve rural financial management, enhance operational management levels, and protect the interests of collective economic organizations and the legitimate rights of farmers.

Significance of Rural Collective Economic Auditing

With the development and growth of rural collective economies in China, the need for audit supervision of rural collective assets has also increased.

1. Conducting collective economic audits in rural areas helps ensure that rural collective economic assets are more effectively used for collective construction, achieving asset preservation and appreciation, promoting the development of collective economies, and maintaining social stability in rural areas.
2. Agriculture holds an important position in China’s national economy, and rural collective economic auditing is a crucial part of the national auditing system. The implementation of rural collective economic auditing helps promote the comprehensive development of audit work. Therefore, audit supervision plays a vital role in the management of rural collective economies and in the construction of new rural areas.

Models and Basis of Rural Collective Economic Auditing

There are four main models of rural collective economic auditing supervised by national auditing bodies:

1. Audit institutions established by township governments conduct audits of rural collective economies. This model integrates rural collective economic auditing as part of government auditing. In recent years, this model has been widely adopted in practice.
2. Special audit departments are set up between county-level and township-level to conduct audits. This model operates under the delegation of county-level national audit departments.
3. County-level national audit departments directly carry out audit work. This model is more commonly used in economically developed rural areas where there is less disparity between urban and rural development, and financial management is more standardized.
4. City-level audit institutions conduct audits. These specialized city-level audit institutions have a vertical relationship with county-level national audit departments, with no administrative subordination. Due to limitations in human and financial resources, this model is less common in practice.

Content of Rural Collective Economic Auditing

1. Verification and management of funds and assets
2. Financial revenues and expenditures, related economic activities, and their economic effectiveness