ISLAMABAD: The Federal Board of Revenue (FBR) has launched forensic audit of Web Based One Customs (WeBOC) to determine the accuracy and correct application of duty and taxes.
In order to conduct forensic audit, the FBR invited firms for the assignment to conduct audit of the internal controls of WeBOC system for quality assurance for the year 2020/2021, 2019/2020 and 2018/2019.
The forensic audit is aimed at assuring that the mechanism of internal controls, business decisions, rules, policies, and procedures are well defined, correctly calculated, and if not then recommend possible solution/ way forward.
It is meant to analyze that the systems in place are capable – fully automated with seamless integration of all Customs’ business processes.
The applicant firm is expected to analyze the WeBOC’s capability in carrying out the day-to-day functions, its governance model, business rules, duty calculation across all regimes, correctness of information as an output, and security structures etc.
The Internal Control Audit will identify the strengths and weaknesses as follows and recommend appropriate actions to FBR, namely:
i. Whether the rates of Customs Duties, Additional Customs Duties and Regulatory Duties are properly and correctly fed vis-à-vis updated from time to time as applicable in the System?
ii. Whether the WeBOC System correctly calculates and collect the duties as per statutory rates?
iii. Review the feeding, calculation, and collection of domestic taxes i.e., Sales Tax, Withholding Tax and Federal Excise Duty at import stage.
iv. Examine the correctness of feeding of Fifth Schedule in the WeBOC along with its conditions, when and where applicable.
v. Whether rates of duties and taxes were updated in the WeBOC as and when legally changed since January 01, 2018?
vi. The firm will also examine and audit whether different SROs have been correctly fed/ updated in the System along with respective conditions. Any difference or deviation in the SROs feeding/ updating and application in the System will be reported accordingly.
vii. Whether changes were made in the System with corresponding changes in the SROs from time to time in a correct and timely manner?
viii. Whether Valuation Rulings (VRs) issued by the Directorate General of Customs Valuation have been properly entered into the System?
ix. Whether the System correctly applies the VRs on the respective goods or not? The required audited period will be for a period of three years.
Based on the indicated activities, the audit should: (i) map the involved internal control mechanisms; (ii) point out the main weaknesses of the involved internal controls; (iii) identify the main causes; and (iv) propose mitigation measures. The audit and subsequent recommendations should be both quantitative and qualitative considering efficiency and effectiveness of the system, its performance, and corresponding data (input)/ information (output) correctness – real-time and secured operations.
The FBR under the Component-II (Technical Assistance) of the Pakistan Raises Revenue (PRR) project requests the services of a reputable consulting firm to conduct a forensic audit of the WeBOC System of FBR for quality assurance through methodological testing.
The WeBOC system was rolled out in 2012 and has been designed and developed as per the business requirements and vision of Customs i.e., paperless, end-to-end integration, minimum dwell time, 24/7 service, transparency, automated and simplified procedures, improved risk management system including automated feedback mechanisms, better controls, electronic filing, minimum interaction with trader and Customs authorities, efficient information management system, e-gates, online payment, and single window operations.
The underlying idea was/ is to have compliance of international trade facilitation agreements and to develop Customs system in line with international good practices. It provides real time integration of clearing agents, traders, brokers, terminal operators, cargo handlers, shipping agents, bonded carriers, warehouses, airlines, and customs officials for the clearance of trade consignments.