The Discussion Of Chinese Local Government Debt Audit

In recent years our country has placed great importance on the audit of localgovernment debt. On the state council executive meeting, April17,2013,the premier ofthe state council Li Keqiang argued that the next stage focus is effective to prevent risksabout local government debt and credit,strengthen market supervision, and improve thequality of products and services. The Audit Commission had organized the audit ofgovernment debt twice before. It firstly carried a comprehensive audit on the localgovernment debt on2011. The audit found that besides54county-level governmentwithout government debt, the provincial, city and county levels local government debtbalance totaled10.717.491trillion yuan by the end of2010. Following the "census", theaudit office checked on government debt of36local governments at the correspondinglevel. The audit found that,the local government debt balance growth12.94%after twoyear. The auditor reported to the standing committee of the National People’s Congressand the society about the two audit results, also had aroused high attention.Local government debt capital is an important source of funding for localeconomic construction. It plays a positive role in guarantee for local economicdevelopment. At the same time, there are also many species, such as large amount, widesource etc.. Under the precondition of understanding of the current situation of the localgovernment debt in China, this article attempts from the audit content, method,evaluation index and risk prevention aspects to explore China’s local government debtwith local government debt audit status as a starting point. It hopes that through theaudit theory research, make the audit institutions in preventing local government debtrisk, safeguard national financial security, to ensure sustainable economic developmentplay a better role.About the audit content aspect, we mainly review the authenticity of the debt,compliance, liquidity, and the rationality of the capital use. Otherwise, in this paper, it isnecessary to increase the profitability and security audit of debt, so that you can fullyunderstand the application of funds. Based on the present situation of our localgovernment debt use and management, this paper make points that, audit method shouldincrease the financial audit, auditing system rationality and policy implementation effectin addition to using conventional method; in the evaluation of the indicators, we alsoshould from the perspective of the cadre performance evaluation index to improve theaudit evaluation index of debt, such as average debt cadres tenure burden ratio, debtsolvency ratio, debt dependence degree, overdue debt rate, it can be morecomprehensive to the cadres of mainland of local government debt management tounderstand the situation. Finally, in reference to the successful experience of foreigndebt risk, the paper puts forward the countermeasures to strengthen risk prevention.