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TMI BlogDifferent Steps of auditX X X X Extracts X X X X X X X X Extracts X X X X ..... n risk parameters. Ascertaining the risk profile of the auditees based on a scientific approach is vital for selection of audit. Audit selection is a dynamic process where the experience of audit in each year plays a vital role in modifying the selection criteria. Some aspects of such risk profile assessment are discussed in this section. Selection criteria for risk-based selection of auditees: are developed in response to a certain compliance environment and aggregate compliance behaviour, as well as yield of past selection criteria. Hence, no selection criteria can be set in stone. However, certain representative selection criteria as well as certain broad areas from which selection criteria can be chosen are briefly discussed below: S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed as reflected in Form GSTR-7 submitted by TDS deductor * Turnover declared by RTP in Form GSTR-3B compared to turnover on which TCS collected as reflected in Form GSTR-8 submitted by TCS collector * Turnover declared by RTP in Form GSTR-3B compared to minimum turnover expected on the basis of e-way bills generated in respect of the said RTP * Refund-claim against purchase from taxpayer having no auto population of ITC in Form GSTR-2A purchases from non-existent RTPs * RTPs having adverse reports in VAT/Service Tax/Central Excise who are operative in GST etc.) Some of the steps and broad principles that may be followed for selection are given below:- A. Taxpayers under the State/Central jurisdiction, i.e. the taxpayers who are r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... considered and a taxpayer with more declared liability may be selected first. I. A Selection Committee may be constituted to identify various risk parameters for selection for audit, considering all the aspects where there are chances of lack of compliance with the Act resulting in short payment of tax etc. such as: J. The final score may be calculated based on the data for each financial year and the parameters as well as the weightage adopted may undergo necessary modifications if required. K. In case the RTP selected for audit has multiple registrations under the same PAN / TAN in the State, it is suggested that all such registration numbers may be selected for audit. L. A certain percentage of the selection of the taxpayers may be d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... * In States, the Commissioner may fix the criteria of selection based on certain parameters as the Commissioner deems fit. * In CGST, the Central Board of Indirect Taxes and Customs has mentioned in their GST Audit Manual that the selection of registered persons for them would be done based on the risk evaluation method prescribed by the Directorate General of Audit (DGA) in consultation with the Directorate General of Analytics and Risk Management (DGARM). The risk evaluation method as well as RTPs selected for audit is separately communicated to the Audit Commissionerates during the month of January/February of every year. The risk assessment function is jointly handled by the Directorate General of Audit and the Risk Management section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the functional hierarchy. The practice varies between state and central GST administrations. State GST: In the State GST administrations, selected cases are allocated to the Zonal level audit head. The system provides facility to the Commissioner i.e. the HQ level to allocate Taxpayers of a particular Zone to that Zonal level Head. In the case of already allocated Taxpayer(s), if the HQ officer wants to modify the Zonal officer, he/she may do so after recording reasons for such change. Central GST: In CGST, Audit Commissioners allocate taxpayers selected for audit (by the list developed by DGARM and DG (Audit) and a list based on local risk parameters) to audit circles and circle in-charges further allocate auditees to audit groups. The A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eed for change of Team Lead arises, the same can be done through the system by reassigning such role to another officer in the jurisdiction. B. Assign Audit Team Members - After assigning the Team Lead, the HQ/Zonal officer can go for assigning the Team Members. The names of the available officers along with their designation and existing work allocation can be viewed on the system and maintaining uniformity in work allocation, Team members can also be assigned. If needed, Team Members can also be changed with other available officers. The RTPs relating to a particular jurisdiction on being selected for Audit may be allotted by the jurisdictional head to next junior level Officers having functional role of Audit and/or Adjudication in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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