The Chamber of Financial Auditors from Romania brings back to the attention of CAFR members the requirements established by Law no. 162/2017, regarding the statutory audit of the annual financial statements and the consolidated annual financial statements and amending some normative acts, regarding the organization of the internal audit activity to entities whose annual financial statements are subject to statutory audit.

Thus, according to art. 65 para. (7) from Law no. 162/2017, "entities whose annual financial statements are subject, according to the law, to statutory audit (respectively public interest entities defined according to art. 2 point 12 of Law no. 162/2017 and entities that meet the size criteria for auditing) are obliged to organize and ensure the exercise of the internal audit activity."

Non-compliance with the requirements regarding the organization of the internal audit activity constitutes, according to art. 44 of Law no. 162/2017, a misdemeanor and is sanctioned with a fine from 50.000 lei to 100.000 lei.

Also, according to GEO 75/1999, republished, regarding the financial audit activity, those responsible for organizing the internal audit activity, coordinating the works/commitments and signing the internal audit reports must have the capacity of active financial auditor.

At the autonomous governments, national companies/companies, as well as at other economic entities with majority state capital, the internal audit activity is organized and operates according to the legal framework regarding the internal public audit of public entities.

In this sense, we recommend that financial auditors communicate to the persons responsible for governance within the audited entity, the legal requirements regarding the organization of the internal audit activity, as well as the sanctions that may be applied.