The Federal Board of Revenue (FBR) has directed all Regional Tax Offices (RTOs) and Large Taxpayers Units (LTUs) to attach their officials with chartered accountants (CA) firms to monitor audit process.
Sources told Business Recorder on Tuesday that it was decided at a meeting of joint co-ordination committee on audit to examine the issues raised by different tax offices regarding audit of companies selected through computerised balloting for composite audit for tax year 2008 held at Federal Board of Revenue (FBR) headquarters the other day.
They said that the board has instructed all RTOs and LTUs to complete the process by attaching officials to CA firms for duration of the composite audit, and have the audit started immediately. The data of these cases would be entered in Tax Audit Monitoring System (TAMS), they added. They said that, if required, the RTOs and LTUs would assign cases for composite audit to CA firms after examining the revenue potential of these cases, or inform the board to remove cases from audit due to absence of any economic/business/income generating activity.
They said that composite audit would be undertaken irrespective of the size of business or income and if already assessed cases are reselected in the ballot, the audit report in this regard would be sent to FBR. When asked about timeframe of CA firms to accept offer of composite audit, sources said that CA firms would give two affirmations.
First is the CA firm's consent to undertake the audit, and second is the engagement letter as prescribed in the Tax Audit Framework (TAF). They said that the acceptance letter from CA firm did not require a taxpayer' signature, but the engagement letter would require it. They said that audit would be conducted by the office of latest jurisdiction, for which the case-records be sent to the correct jurisdiction.