The Audit Process: PERCET: (P) preparation and planning: introduction
The gathering of information on the trader and any associated businesses prior to the visit will;
- determine priorities based, in the first place, on the risks already identified from the sift process, but including any further risks identified by the visit officer;
- identify the visit tasks to be performed to address those risks; and
- help to structure the visit.
Preparation prior to the visit will include the following;
- reviewing EF documents, previous visit reports (if applicable) to check risks identified in previous audits, including any assessments raised;
- checking for voluntary disclosures on file, telephone calls logged to the National Advice Service, or letters querying liabilities;
- health & Safety issues;
- checking if there are un-actioned Routine references on file;
- reading the SIFT report - reason for visit;
- checking your user interest is set;
- checking VISION and the ledger balance to identify compliance issues for example debt on file, outstanding returns. Check returns on file for O/tax and I/tax imbalances and repayment returns when trader is classified as payment;
- quick check on mark up and TPR;
- checking for associated businesses, and if possible check their details on EF/VISION;
- checking for previous contacts with other teams such as DMU or Compliance Management Teams (CMT). Any DMU action is likely to be recorded on DTR notes. CMT’s are likely to record any contact on EF under the document type ‘CMTQ’;
- if trader’s Internet address is available checking this for potential business diversification, for example mail order sales, overseas sales and locations other than those notified to us;
- noting the risk areas identified by risk teams on the Risk Profile in EF. If previously visited, there may be a scanned VAT 465R;
- downloading the relevant documents required;
- preparing your notebook for types of questions to be asked at the initial interview with the trader;
- checking the liability of supplies made by the trader and research the relevant public notices and guidance if necessary; and
- recording the details of visit preparation within the ‘Audit preparation’ fields in EF Audit screen.
At the end of this process, you will have an understanding of the trader’s activities and organisation, identified risks and selected the correct assurance approach.
The Risk Profile within EF is designed to summarise risks identified and provide a cross reference with the EF Audit Report of audit work carried out to address the risks. Although any potential risk areas identified during the visit should be noted in your notebook, it is good practice to also add these to the Risk profile as they are identified. The Risk Profile then acts as a checklist to help ensure that the risks are not overlooked.
This screen is also used to record Health and Safety issues. The use of EF screens is described in more detail in VSME10000 ‘Event Audit Screens on EF’.
They should always be used to provide a record of the planning done and the risks identified.