Information Powers: Computerised Records: Practical Approach
If you believe that the records that you require for the purposes of your enquiry may be held on a computer system, it is good practice to make initial enquiries to find out
- what operating systems and accounting software are used within the business
- what records are maintained by the business
- whether electronic or paper copies will best serve your purposes
- how to describe or define the particular part(s) of the records that you need
- how to define parts of the records that you do not need, so that you are not overwhelmed by data
- whether what you want exists as ‘documents’ or is simply ‘information’
- whether the taxpayer is willing to supply what you want on disk or whether you may have to overcome resistance.
As suggested above, it would be appropriate to involve your local Data Handling Specialist at this stage. They can give advice on how best to obtain electronic media relevant to your enquiry.
If you want to have the records supplied in electronic format you will need to take care, both in your informal request EM10008 / EM10109 and in the formal notice, to specify exactly what you want. You need to be clear whether you are seeking ‘documents’ in which case you would have to specify the electronic document; or, in a CTSA case, ‘information’ in which case you can specify the format.
Framing a Request
- Usually business financial records will be backed up. The backed up version may still exist or alternatively a copy of the financial records may have been provided to the agent for them to produce the accounts. Both are documents and can be specifically requested. If there is no existing version of the records on an external medium (tape, CD, floppy, zip drive etc.) the information is likely to be on the hard disk or server. Potentially these could be requested (or the whole computer system) but the usual aim is to obtain a copy of all the financial transactions recorded on the computer in a form you can use. As you could strictly require production of the computer or check its operation (FA88/S127 (2) below), the taxpayer may well decide that providing a copy in a usable format makes sense.
- As a document is a physical object you cannot require a record to be re-created. If no record was made or it is no longer available you can only request information (but in this case format can be specified in a paragraph 27 notice).
- Normally you will ask for computerised records to be supplied on a copy disk. You should not routinely invoke S19A (3) (b) or Paragraph 27 (3) (b) - referred to above - in your initial notice, but you may do so if you have reason to believe that the taxpayer is determined to supply printouts instead of the electronic copy needed. When your SA information notice refers to electronic copies or extracts of electronic records but the taxpayer provides paper printouts you should consider issuing a fresh informal request before a formal notice invoking S19A (3) (b) or Paragraph 27 (3) (b).
- If the SA information powers are not available and you are considering invoking Section 20B (4) (b) seek advice from contact point before issuing the precursor letter.
Inspection and Operation of Computers
FA88/S127 (2) allows a person authorised by the Board access to any computer that has been used in connection with a document to which the subsection applies. It allows the authorised person to inspect and check the operation of a computer and to be given reasonable assistance by the person on whose behalf the computer has been used.
Whenever possible you should work through the business’s own computing staff, or take copies of the data to analyse elsewhere. The Audit Service Team is available to provide advice if required, see EM2801.
NB Do not operate the business’ computer yourself, even if invited to do so.
If you are unable to work through the staff of the business you should discuss this informally with the Audit Service Team (EM2801).