Audit of high-risk cases: DG PCA to keep contravention reports data in traders' profiles

The Direct-orate-General of Post-Clearance Audit (PCA), Karachi, has decided to maintain data on contravention reports framed against importers to conduct audit of high-risk cases on the basis of traders' profiles.
Sources told Business Recorder here on Friday that the DG PCA Karachi has started an exercise to maintain traders' profiles containing data of importers and exporters for audit of high-risk traders. The major hurdle in conducting post-clearance audit of importers and exporters is the absence of the traders' profiles.
The DG PCA of the FBR has taken an initiative for maintaining traders' profiles, based on the contravention reports framed against the importers and exporters during the last few years. This is for the first time that the DG PCA would use traders' profiles taking into account the contravention reports framed against the importers/exporters for audit purposes.
The directorate has developed a system to maintain data on contravention reports framed against importers and exporters. The National Tax Numbers (NTNs) of the importers/ exporters would also be fed into the system to identify traders against whom maximum number of contravention reports has been finalised. In this way, the department would be in a position to select high-risk cases for audit on the basis of contravention reports and other related data. The new system would enable the DG PCA to conduct audit of the importers/exporters in a more objective manner.
Sources said that the FBR has maintained a list of blacklisted companies or suspected units on the sales tax side. The Board is well aware of the non-compliant persons subsequently blacklisted by the tax department. On the other hand, there is no concept of blacklisting of importers and exporters on customs side. To tackle the issue of non-compliant importers/exporters, the DG PCA would maintain data based on contravention reports. Once when the directorate would complete profiling of importers, the department can have enough justification for selection of any importer for post-clearance audit.
Sources said that it is the basic right of any importer to ask the directorate to give reasons for selection of his name for audit. The department has to give some solid reasons for selection of audit cases. On the basis of traders' profiles, the department can inform the unit about the number of contravention reports framed against the unit. Similarly, if the importer has been involved in under-valuation, under-invoicing or other violations, the information would be reflected in the traders' profiles.