The aim of this report is to convince organizations that the appropriate emphasis should be placed on the tax audit process through a tried and tested methodology, where this area of tax risk management can be streamlined and improved.

The focus is a pro-active engagement with Revenue Services, supported by a process to deal with potential tax exposure issues before they become material risks. This precise methodology is usually not followed despite that it is a process that has significant merit in most circumstances.

These circumstances include a global environment where there is:

• country collusion’ between Revenue Services;
• increased verification audits through Large Tax Units (LTU’s), and in the areas of indirect taxes, transfer pricing, and anti-avoidance;
• more litigious Revenue Services; and
• global tax administration being influenced by the former head of the South African Revenue Service, Pravin Gordhan.

The challenge in convincing organizations is that this area of tax risk be a high priority, and should be implemented on a broad scale across any group, region by region, in a staged manner.

The urgency with which this must be done is apparent from the results of the a survey conducted by TRM™...