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Beyond year one

Ongoing monitoring and assurance

Once businesses complete the first year and have determined that they have appropriate tax accounting arrangements in place or made the appropriate disclosures, they need to consider whether they have an appropriate framework and process in place to support monitoring of the arrangements or any required improvements currently being made. SAO beyond

If you are responsible for tax, such a framework should enable you to identify controls which are no longer doing their job, new risks which need to be managed and support your SAO in fulfilling their main duty and submitting the annual certificate.

Most businesses that have started to think about how best to do this are looking to build on existing processes, such as Sarbanes-Oxley compliance, for those subject to those rules or periodic management representation letters.

Once the relevant existing process is identified, the following steps should help you in providing ongoing monitoring of the controls and assurance for your SAO:

  • Confirm roles and responsibilities - those responsible for taxes should know who they are and what they are responsible for;
  • Provide training and guidance - depending on their roles they should provide appropriate training to understand the overall objectives of tax management and their part in it;
  • Perform periodic internal self-assessment and signoff - periodically they should then be able to confirm that their objectives have been met and, if not, provide details;
  • Review and test controls - if appropriate, such assertions and the underlying evidence could be subject to independent review by internal audit or others;
  • Certify and disclose to HMRC - the internal sign offs and disclosures can then be collated and used to support the external certificate.
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