Government Audit,Fiscal Transparency And Local Government Debt Risk

In recent years,the issue of local government debt risk has become a major obstacle in our economy.The supervision and control of the debt risk of local governments has become an important political target in the current economic work.From the 12th Five-Year Plan proposed to establish and improve local government debt management system;and the "decision" of the Third Plenary Session of the 18th CPC Central Committee proposed to set up a comprehensive accrual government financial reporting system,establish reasonable specification of the central and local government debt management and risk early warning mechanism;and the issuance of the State Council's Opinions on Strengthening the Management of Local Government Debt and the revision of the Budget Law in 2014;and the issuance of the Plan for the Emergency Response to Local Government Debt Risks in 2016;as well as the Announcement on Further Regulating the Financing of Local Government Borrowing by six ministries including the Ministry of Finance in 2017.A series of laws and regulations have put forward specific requirements on strengthening local government debt and debt risk management.The 19th congress of the CPC once again listed "preventing and resolving major risks" to the strategic level as the top priority of the "three major wars",the prevention and resolution of local government debt risk is undoubtedly an important content,which is widely concerned by the Ministry of Finance and local governments.The prevention and solution of local government debt risk should be studied deeply.Government audit,is an important guarantee for the prevention and control of national governance risks(Liu,2015),which has played a very important role in the supervision of local government debt risk in recent years.The 12th Five-Year Plan of the National Audit Office has already incorporated the local government debt into the audit of revenue and expenditure of local governments.In 2011,2012 and 2013,the Audit Commission organized three consecutive large-scale government debt audit activities under the guidance of the relevant documents of the State Council and announced the audit results respectively.The special auditing of government debt uncovers the "veil" of the government debts in our country,especially the debts of local governments.The results of several debts audits fully reflect the scale,structure,source of funds,destination of funds and debt management of local government debts.In 2014,"the State Council's Opinions about Strengthening the Auditing Work" put forward that,government audit should focus on special tendency problem in the field of local government debts,and give some advices to dissolve the risk ".Although no special auditing of large-scale government debts has been organized since 2013,the audit report on the implementation of the annual budget still contains special explanations on the debts of local governments.The follow-up audit of the implementation of major state policies is also continuing to investigate and deal with violations of laws and regulations of local government debt behavior.Government audit will remain an important force in preventing the debt risk of local governments.To find out the physical truth of the local government debts through the government auditing with great efforts,which directly reflected that the opacity of local government debt information is one of the outstanding problems on local government debts.Fiscal transparency is one of the important means of government financial management.In recent years,especially after the national debt audit in 2013,the financial transparency of local government debt has been paid more and more attention.In 2014,the State Council's Opinions on Strengthening Debt Management in Local Governments explicitly put forward the "Establishment of an Open System of Local Government Debt".In 2015,the new"Budget Law" explicitly stipulated that local governments should disclose "borrowing debts" to the public timely.In 2017,the Notice on Further Regulating Local Government Debt Financing by the six ministries and commissions including the Ministry of Finance specifically put forward some specific requirements on "promoting the disclosure of debt information.”Many local governments also responded positively and made efforts in promoting the financial transparency of local government debt information.The role of fiscal transparency in local government debt risk management is growing.Government audit have made plenty of efforts to promote local government debt management,whether these performance actually reduced the risk of local government debt?Under the supervision of government audit,local government debt management departments have also done a lot of work in promoting local government debt information disclosure in recent years.Can financial transparency really reduce the debt risk of local governments?And will changes in fiscal transparency affect the effect of government audit on local government debt risk?The improvement of financial transparency is to further strengthen the action of the government audit of local government debt risk,or to reduce the high dependence on government audit during local government debt risk prevention?There are not many relevant and scattered existing researches,and there is still no systematic study on the relationship between the three.From the state governance and local government debt risk prevention and control of the whole,both inseparable from the government auditing supervision for security risk prevention and control,more from the government's own debt risk management continuing improvement,the prevention and control of the debt risk of local government is a systematic project,may need to form a multispectral linkage coping mechanism.Therefore,this paper puts the government audit,fiscal transparency and local government debt risk in the same framework,to explore the interrelationship between government audit,fiscal transparency and local government debt risk.This paper will obtain empirical evidence of the role of government audit and fiscal transparency in local government debt risk supervision,and observe how the financial transparency under the audit "forced" affects the role of government audit in the risk of local government debt in turn,rationalize the role of government audit and fiscal transparency in local government debt risk supervision,put forward some suggestions to improve the local government debt supervision combining with the practice,to prevent and defuse the debt risks of local governments furtherly,earnestly safeguard national financial and financial security,and safeguard national economic security.This paper is based on the principle of problem orientation,based on the grim reality of the debt risk of local governments in our country.To provide beneficial reference for the prevention of debt risk of local governments and safeguard the national financial security is our research goal.The main contents of this paper are as follows:First of all,it sorts out the previous literature related to the topics,analyzes and sums up the experience and shortcomings of previous studies,and establishes the starting point of this study on the basis of previous studies,that is,to include government auditing and financial transparency into local government debts risk prevention into one research framework.Secondly,combing the development of local government debt in our country,summarizing the current situation and characteristics of local government debt in our country,summarizing the existing problems in the development of local government debt and analyzing the reasons for it,and trying to find a way to prevent local government debt risks from the practice of local government debt point.Then,the paper elaborates the relevant theoretical basis of local government debt problem,discusses the basic basis and mechanism of government audit on prevention of local government debt risk,and combines the facts of audit supervision and financial transparency in the prevention of local government debt risk in our country,analysis of the possible impact of fiscal transparency on the role of government audit in local government debt risk,and preliminarily summarizes the framework of the relationship between government audit and the financial transparency of local government debt risk,which lays a theoretical foundation for the subsequent empirical research.Then,uses the data collected,analyzed and collated by hand to take empirical analysis,to obtain empirical evidence of the role of government audit and fiscal transparency in local government debt risk supervision,and to observe how the financial transparency under the audit "forced" affects the role of government audit in the risk of local government debt in turn.And find that the local government debt risk is significantly negative correlated with the efforts of the government audit,is also significantly negative correlated with the fiscal transparency,and when fiscal transparency is worse,the government audit role of local government debt risk is more significant.Financial transparency can reduce the high dependence on government audit supervision during local government debt risk prevention.Government audit is an important guarantee for preventing and controlling the debt risk of local governments when fiscal transparency is worse.Finally,based on the above theoretical analysis and empirical research,this paper puts forward the coordination of local government debt information disclosure and audit monitoring based on risk prevention.to make suggestions from the perspective of perfecting the local government debt information disclosure and establishing a regular audit monitoring mechanism for local government debt,and emphasizes the coordination and interaction between the two,In order to improve the level of local government debt supervision,prevent the local government debt risk furtherly.The main innovations of this article are as follows:First,the existing research on local government debt audit is not systematic enough,in particular,the study of local government debt audit from the perspective of information asymmetry or financial transparency is rare,on the basis of previous studies,this paper puts the fiscal transparency as an important factor into the study of local government debt audit,studies the prevention and control of local government debt risk from the perspective of both government audit and fiscal transparency,which shows some innovation in the perspective of research.Second,the existing studies on the audit of local government debts are mostly discussed at the normative level.The empirical research on the effects of government audits on the monitoring of local government debt risks is rare,this paper empirically tests the negative correlation between government audit and local government debt risk,and obtains the empirical evidence of government audit on prevention of local government debt risk,which further enriches relevant literature on government audit governance function.Third,the study finds that local government debt risk has a significant negative correlation with both government audit function and fiscal transparency,and when fiscal transparency is worse,the government audit role of local government debt risk is more significant,financial transparency can reduce the high dependence on government audit supervision during local government debt risk prevention,government audit is an important guarantee for preventing and controlling the debt risk of local governments when fiscal transparency is worse,according to the research results of the system,this paper puts forward the synergy of local government debt information disclosure and audit monitoring based on risk prevention,that is,to prevent local government debt risk by improving the transparency of local government debt information and establishing the local government debt audit routine monitoring mechanism,to provide a certain innovation to improve the supervision level of local government debt risk in our country.