New DOF unit takes over BOC’s post-entry audit functions

MANILA, Philippines - A newly-created unit under the Department of Finance has been formally tapped to assume the Bureau of Customs’ post-entry audit functions.

President Aquino signed an executive order transferring the post-entry audit functions of the BOC to the newly-established Financial Intelligence Unit (FIU).

The finance department earlier considered transferring BOC’s key audit function to the Bureau of Internal Revenue.

The FIU, which is under the direct supervision and control of Finance Secretary Cesar Purisima, is tasked to identify potential revenue sources and leakages by analyzing data from the BIR, BOC, Bureau of Local Government Finance and other revenue-generating agencies attached to the DOF and comparing these with third-party information.

The new unit is also tasked with monitoring the revenue performance of the implementing offices of the revenue generating agencies in coordination with their respective statistics divisions and recommending to the DOF chief improvements to help achieve their targets.

Post-entry audit has resulted in higher revenues for the BOC. In 2011, the BOC’s Post Entry Audit Group, which conducts audits to determine the accuracy of the import taxes and duties that importers must pay, collected more than P400 million.

PEAG’s collections increased further in 2012 to around P700 million.

The PEAG conducts audits to determine the accuracy of the import taxes and duties paid by importers.

The creation of the FIU is aimed at boosting revenues and  stamping out corruption, tax evasion and  smuggling.

The system of post-entry audit is an accepted international best practice aimed at increasing trade facilitation, encouraging voluntary disclosures, reducing incidence of fraud and protecting government revenues.

The BOC is currently in the middle of a massive reorganization process aimed at cleaning up its tarnished image.