The origin of the Board of Audit and Inspection, Republic of Korea, can be traced back to the establishment of'Sajongbu'as the central inspection agency of the Shilla Kingdom in 659 AD. The Constitution promulgated in 1948, with the formation of the Republic of Korea, established the Board of Audit. A separate Commission of Inspection was also set up under the Government Organization Act of 1949. However, as audit by the Board and inspection by the Commission in many cases were so closely related, no clear demarcation couJd be drawn between their duties. The two organizations were, therefore, merged by an amendment to the Constitution in 1962. Thus, the present Board of Audit and Inspection (BAI) came into being on March 20,71963.
Articles 97 to 100 of the Constitution and the Act of 1963 passed in pursuance of the constitutional provision define the status, organization, duties and powers of the BAI.
The BAI's duties and functions are as follows:
There are internal audit and inspection organizations within each government agency, local autonomous body and government-invested organization. The BAI provides them with advisory opinions and guidelines on their work and receives their reports on internal audit and inspection.
The BAI is under the direct jurisdiction of the President and comprises the Chairman, the Council of Commissioners and the Secretariat. The Secretariat, which is under a Secretary General, has six Bureaus which audit and inspect the activities of the various organizations. In addition to these Bureaus, the BAI has General Affairs Divisions and offices of Public Information, Planning and Management, Legal Review, and Education and Training.
Although under the President of the Republic, the BAI has an independent status in regard to its duties. To ensure the independence, the Chairman of the BAI, like the Chief Justice and the Prime Minister, is appointed by the President with the consent of the National Assembly. The term of office of the Chairman is four years with only one additional term. The Commissioner is appointed by the President on the recommendation of the Chairman and has the same term of office as that of the Chairman.
The BAI has adequate statutory powers to carry out its duties and responsibilities, effectively. It may also, if necessary, request the presentation of materials or attendance or reply from a person other than the agency subjected to audit and inspection. It may seal warehouses, safes, documents and articles limited to a minimum extent necessary for conducting audit and inspection. The Council of Commissioners of the BAI may, where needed, request a person of knowledge and expedience to give expertise. The BAI is empowered to examine and adjudicate as to whether or not accounting officials or any other person is liable for compensation in accordance with the provisions of laws. It may also request the pertinent minister or the appointing authorities to take disciplinary action on public officials who fall under causes for disciplinary action or who have refused the audit and inspection or neglected the submission of documents without any proper reason. In case the BAI has found a fact which seems illegal or improper it may request the competent authority to correct or pay more attention to it. The competent authority should fulfil such request within the period set by the BAI.
The BAI prepares two kinds of reports on its activities; Annual Report and Interim Report.
Annual Report: There are two Annual Reports - one is the Annual Report on the closing of accounts of the State which is submitted to the President and the National Assembly in the following financial year as per constitutional provisions; the other is the report on the closing of accounts of the government-invested authorities submitted to the government in accordance with the Basic Act on the Management of Government-invested Organizations.
The Annual Report on the closing of State accounts includes:
The Annual Report on the closing of accounts of government-invested organizations shall include:
Interim Report: The Chairman submits Interim Reports to the President whenever deemed necessary. The Interim Reports include not only significant findings, but also recommendations which were made more than twice earlier by the BAI but were not responded to.
The BAI has taken active interest in promoting international cooperation and exchange of ideas and experiences, especially in the Asian region. BAI has been on the Governing Board of ASOSAI ever since the inception of ASOSAI in 1979.
The BAI hosted the Second Assembly and First International Seminar in Seoul during April 1982 and functioned as the Chairman of ASOSAI for the three years from 1982 to 1985.
The BAI has been continuously hosting seminars on public auditing for member institutions of ASOSAI. The seminar slated for 1993 will be on Audit of Transportation.