APPOINTMENT OF RETAINER FOR REGULAR REVIEW AND ASSISTANCE IN GOODS & SERVICE TAX (GST) COMPLIANCES

Transcription

1 IDBI Bank Limited Response to pre-bid queries to Request for Proposal For APPOINTMENT OF RETAINER FOR REGULAR REVIEW AND ASSISTANCE IN GOODS & SERVICE TAX (GST) COMPLIANCES dated February 1, 2019

2 The Bank had issued the Request for Proposal (RFP Reference No. FAD/199/ dated February 01, 2019) to the bidders for the APPOINTMENT OF RETAINER FOR REGULAR REVIEW AND ASSISTANCE IN GOODS & SERVICE TAX (GST) COMPLIANCES. As per the terms of the RFP document the last date and time for receipt of written queries for clarification from bidders was February 8, In respect of same Bank has received pre bid queries from some bidders. Accordingly, replies to these pre bid queries are given as under. This document covers clarifications to the queries raised by the Bidders. All efforts have been made to provide the maximum available information and answer the pre-bid queries submitted by the Bidders. The Bidders are required to consider the information provided in this document as the latest guidelines. The Bidders have been provided with the clarifications and details through this document. However the questions pertaining to details that were already provided in the RFP have not been answered. Please treat this document including the entire Pre-Bid Queries Responses provided by the Bank as an integral part of the RFP document issued. Only the sections, clauses, terms referred in this document are revised/updated to the extent revised/clarified. All other terms and conditions of the RFP document remain unchanged.

3 1 General No. of Business Areas and Nature of Business Area The Bank is presently having Pan India presence with over 1894 branches as on date. Further details related to different Business areas can be found on Bank s website 2 General Volume of Transactions The approximate volume of B2B transactions is close to 4 Lakh with approximately 50 Thousand invoices per month. The approximate volume of B2C transactions is close to 60 Lakh with approximately 35 Lakhs invoices per month 3 General Taxable Turnover The same may be referred in the Bank s Annual Report available on the Bank s website. 4 General Exempted and Non-Taxable Supply The same is available on Bank s annual report available on Bank s website. 5 General Draft Agreement and Letter of Agreement has to be submitted by the successful bidder only, once the work is awarded or the same has to be submitted along with the tender document. 6 General It is mentioned in RPF that eligibility criteria shall include the bidder along with its affiliates/group companies/member firms. Yes, Draft Agreement and Letter of Agreement have to be submitted by the successful bidder only after the work is awarded. Yes, Eligibility Criteria shall include the Bidder along with its Affiliates/ Group companies/ member firms working under the common brand name and engaged in similar activity of accounting advisory/ financial services, registered in India.

4 7 General (iii) 8 General (viii) Please provide an estimated number of identified contracts that will be required to be reviewed. Further, we understand that IDBI Bank would identify and provide these contracts for our review. Request you to clarify. Please clarify whether deputation of identified staff is required on a full time basis at the corporate office in Mumbai. The contracts are majorly standardised being entered in relation to the inputs of the Bank with its vendors /suppliers etc. under its various Business, Non-Business Verticals. One time review of the existing areas where such contracts are being executed needs to be undertaken by the bidder to suggest changes if any in any clauses. Identification of New contracts for scrutiny will be done by the Bank and referred to the bidder for clarifications if any. Yes the same will be required on full time Basis at the Corporate Centre Mumbai. 9 (i) 10 (ii) & (ix) We understand that GST audit certification is outside the scope. Please clarify. In relation to litigation under the GST regime, we understand that the scope of work does not include any assistance in relation to filing of appeals with any appellate authority or courts. Further, we understand that assistance/filing of Advance rulings is outside the scope too. Please clarify. Yes, GST audit Certification is outside the scope, however assistance is sought in providing necessary data & reports for preparation of Annual return and reconciliation statements as and when notified by CBIC/GOI in this regard for a concrete audit closure. The scope of work includes providing assistance during the engagement period to the Bank towards replying to inquiries, Show Cause Notices including representations if required in front of the Tax authorities, vetting the replies/ Appeals drafted by the Bank for submissions. However, if the drafting of appeals including appearance if any in front of appellate authority or courts or filing of Advance rulings in response

5 to Show cause Notices is done by the Bidder, then the same is outside the scope. 11 b) (v) & (vii) 12 b) (viii) 13 c) Input (v) 14 c) Input (vii) 15 d) Techno Functional In relation to deposit and payment of taxes, we understand that our scope would be limited to providing the amount of tax payable to IDBI for payment. We shall not be responsible for handling the payment of tax. Please clarify. We understand that only assistance during EA audit 2000 is covered here and any pending/new litigation under the erstwhile Service Tax/VAT regime is outside the scope. Whether separate full time deputation is required for Navi Mumbai premises of IDBI? Please let us know by when IDBI Bank would be able to provide us the requisite data for calculations/report required to be made by us and to be submitted to IDBI Bank by 10th of the subsequent month. 1. Please provide the specific details of Bank s CBS integration with the Tax engine, including details of the following: a) How does the data transfer to Tax Engine i.e. is it line level data is transferred? b) Tax computation and posting is done in the CBS or in the Tax Engine? c) Final report of outward supply is generated Yes, the scope would be limited to providing the amount of tax payable to IDBI for payment after ensuring that the same is in sync with the books of the Bank and in accordance with the GST law. Point b)viii : Scope of work clearly specifies for assistance by way of replies to Service Tax and GST audit queries / observations raised by the department during EA-2000 audit. Yes, full time deputation is required for Navi Mumbai office also as the Bank s payment unit is based centrally at Belapur Navi Mumbai. The requisite data for calculations/report will be provided latest by 5th of every month unless there are any exceptional circumstances due to which the same may be delayed beyond the standard date of 5 th of every subsequent month to which it pertains. Please find the point wise reply a) Yes Line level data is transferred from CBS/Sources systems to tax Engine b) Tax Computation and posting is done partially in CBS. In some Income placeholders the tax is not bifurcated in CBS. Hence, the same is paid based on the workings in the Tax Engine

6 in the CBS or in the Tax Engine? d) Accounting effect of the taxes is made in the CBS or the Tax Engine? c) Final report of outward supply is generated in Tax Engine. d) Accounting effect of the taxes is made in the CBS. 2. Please provide us the list of systems/expected number of systems to be reviewed from a Techno Functional perspective. 16 General Bidder as referred to in the RFP shall for all purposes include the affiliate firms as well. For instance, the Bidder may Firm A, however the Indirect tax team and engagement team by be of an affiliate firm Firm B. Please confirm. 2) List of systems includes the following : a) Core Banking System Finacle (CBS): b) Oracle: c) Debit Card d) Credit Card e) Locker Management System f) Cash Management System g) Bill Payment h) Government Banking System i) DEMAT j) Tax Engine- Software Yes, Eligibility Criteria shall include the Bidder along with its Affiliates/ Group companies/ member firms working under the common brand name and engaged in similar activity of accounting advisory/ financial services, registered in India. 17 Annexure E: Clause: a) General i) ii) The said clause reads to mean that a regular review should be conducted by the engagement team on the system, procedures and / or policies; i) To provide regular report (in general) ii) To review GST implications on transactions The bidder has to review the existing systems & processes for the first time immediately on the appointment and thereafter with a quarterly frequency. Also, the bidder is expected to review in the specific areas as and when the same is subject to change due to internal Bank policies or

7 iii) vi) and identify potential risk and make changes to operating and business structure due to any regulatory change, if the same falls between the standard review. vii) iii) Review and suggest changes to documents / contracts / communications etc. xii) vi) Review and suggest changes to the policies xiii) xii) Review of E-waybill process and suggest xiv) changes for improvement xiii) xiv) Review valuation and taxability of interbranch activities, foreign exchange transactions, taxability of employee benefits, removal of capital goods etc. 18 Annexure E: a) b) and c) Query While the above is an elaborate and exhaustive scope for regular review of systems, procedures and policies from IT and GST technical perspective, we understand that the Firm (i.e. Bidder) will conduct the review on a specific request from the Bank; or alternatively, please provide the periodicity expected from the Bidder for conducting the review under the clauses alongside. Does the Bank have any Standard Operating Procedure / Report finalized during implementation of GST which contains mapping of all the transactions (outward and inward) of the Bank and their taxability. Yes the Bank has the report finalized during implementation of GST containing the requisite details.

8 19 Annexure E: Clause: a) General The Annexure E includes review of policy documents and guidance notes Does the Bank have these documents available for the purpose of review? To the extent available on record, the same is available for review. Further, the bidder may guide for seeking any necessary document pertaining to any business / non-business areas under the scope of GST. 20 Annexure E: Clause: a) General iv) v) ix) x) xi) The said clauses pertain to review of; iv) Transactions without consideration v) Analysis and review of the Anti-profiteering provisions on the Bank ix) and x) Review of communications to be sent to Branches / Regional and Zonal offices xi) Providing comments on the accounting and ledgers Providing any other advice / opinion Yes, as and when desired by the Bank over phone or or any other formal communication made to the bidder. Query: We understand that the above scope is for on-call advisory when required by the Bank. As and when Bank approaches the Firm with a specific task / query (along with the detailed background), the same would be responded by the Firm. The Firm will not suo-moto review the above transactions, in general. Please confirm.

9 21 Annexure E vi) With respect to scope on GST Audits and Annual Returns i.e. Form GSTR 9 and GSTR C, Clause: b) clause b) i) and vi) We understand that the scope covers assistance in filing said forms for FY and FY irrespective of the dead-line (which may go beyond March 2021). vi) Please confirm. Further, is Bidder expected to sign the GST Audit report? Can a third-party be engaged for signing the Audit Report? If yes, would engage the third party; Bidder or the Bank? Furthermore, we understand that, filing or assistance in filing GSTR 9 and 9C for FY and FY shall not be the responsibility of the Bidder. Please confirm. The bidder is expected to assist in filling of annual returns which are falling due during their contracted period i.e for FY and for FY irrespective of the fact that the original timelines may be extended by the regulator. The Bank shall undertake the GST Audit assignment separately, however, the Bidder shall provide with necessary assistance to the GST Auditor for the relevant period. 22 Annexure E Clause: b) iii) viii) ix) Clause iii), viii), ix) With respect to assistance in replying to inquiries, Show Cause Notices (SCNs), assistance during EA Audit, etc We understand that this assistance is for inquiries undertake, SCNs received, EA Audit conducted or any other assessment conducted The scope of work includes providing assistance during the engagement period to the Bank towards replying to inquiries, Show Cause Notices including representations if required in front of the Tax authorities, vetting the replies/ Appeals drafted by the Bank for submissions. However, if the drafting of appeals including appearance if any in front of appellate authority

10 during the engagement period (FY and FY ) and not for the engagement period. Please confirm. or courts or filing of Advance rulings in response to Show cause Notices is done by the Bidder, then the same is outside the scope. Further, assistance with respect to inquiries, SCNs, assessments and EA Audit we understand that the scope does not cover representation, hearing and filing of appeals. Please confirm. 23 Annexure E: Clauses a) and b) 24 Annexure E Clause: b) ii) Is the Bidder expected to the visit Branch offices and GST department in various States for assistance with respect to inquiries, SCNs, assessments and EA Audits With respect to the scope regarding the end-to-end compliance support services. We understand that the Firm will assist in review of the return basis the details provided by the Bank. The firm will not be engaged in extracting, handling, collating, sanitizing the data from the systems. Please clarify or confirm. No, the bidder is not expected to visit Branches & offices in various States, however any assistance in this regard shall be provided by the Bidder. The Bank will be providing the data from system as required to the bidder, however the further handling, sanitizing of the data will be done by the bidder.

11 25 Annexure E Clause: b) Within the Bank, who is responsible for ensuring compliances Central team or local teams? In other words, please clarify on whether compliances are undertaken centrally or at the branch / state level. The Bank is ensuring s Centrally from its Corporate Centre based at Mumbai. 26 Annexure E Clause: b) Is there any time-line within which the Bank will make the data available to the Bidder for ensuring monthly compliances? 27 Annexure E Please clarify on whether the Bank had centralized or State-level registration under the erstwhile service tax law? If centralized, please confirm effective date. 28 Annexure E Clause: c) Input s v) The team of the bidder is expected at premises of Belapur or Navi Mumbai, however, is there any other premise where the presence of the bidder s team would be required? The requisite data for calculations/report will be provided latest by 5th of every month unless there are any exceptional circumstances due to which the same may be delayed beyond the standard date of 5 th of every subsequent month to which it pertains. The Bank has Centralised Registrations since 2008 under erstwhile Service tax law. The presence of the team of the bidder is expected at Belapur, Navi Mumbai as Banks Payment unit is based at Belapur presently. Simultaneously presence of team is also required at Corporate Centre, Cuffe Parade Mumbai being the Bank s Taxation Cell functioning therefrom. 29 Annexure E Clause: c) Input s Under point vi) and vii) of Cause c) of Annexure E: For reviewing the eligibility of ITC on vendor invoices, will the copies of the invoices / documents be available online or in physical form? In the event The same will be available online as well as offline at Bank s premises based at Belapur, Navi Mumbai.

12 vi) and vii) invoices / documents are made physically available, we understand that the same will be available at the central location i.e. in Belapur or Navi Mumbai offices. Please confirm. 30 Annexure E Clause: c) Input s x) and xi) 31 Annexure E Clause: d) Under point x) and xi) of Cause c) of Annexure E: For the purpose of reconciliation of GSTR 2A and GSTR 3B, we understand that the bidder is expected to follow-up with the vendors will the follow-up with vendors be done by the engagement team of the Bidder directly or will the Bank s internal team assist with the same. Please clarify. Does the Bank have an existing software (ASP / GSP) solution for GST compliances? Please provide details For the said purpose follow up with the vendors will be done by the engagement team of the Bidder. Yes, the Bank is currently availing ASP services of M/s Image Info Systems Private Limited (IISPL) & Bank has appointed NSDL as their GSP service provider. 32 Annexure E Clause: d), i) Request you to elaborate on the number of diversified activities as on date and if currently these are happening manually or in any other system other than CBS This includes: a) Core Banking System Finacle (CBS): b) Oracle: c) Debit Card d) Credit Card e) Locker Management System f) Cash Management System g) Bill Payment h) Government Banking System i) DEMAT

13 j) Tax Engine- Software 33 Annexure E Clause: d), One time assignment 34 Annexure E Clause: d), One time assignment 35 Annexure E Clause: d), iv) As consultants we would be required to review the existing process, provide solution to automate the same and created BRD documents. Implementation of the same would be responsibility of vendor/bank s IT Team. Please confirm Please let us know in case you have any timelines in mind for completion of this activity. Please provide the list of systems which are impacted due to GST Implementation of The same under the guidance of the Bidder will be responsibility of the Bank s IT team. For one time assignment the timelines expected is of 2 months from the date of assignment. This includes: a) Core Banking System Finacle (CBS): b) Oracle: c) Debit Card d) Credit Card e) Locker Management System f) Cash Management System g) Bill Payment h) Government Banking System i) DEMAT j) Tax Engine- Software

14 36 Annexure F What will be payment terms for one time technology assignment. Payment Terms 37 Annexure F Payment Terms With respect to inquiries / SCNs / assessments / departmental audits etc. the successful achievement / completion of activity should mean filing of the reply to the inquiry or SCN, and assistance during assessments and departmental audit. The payment is not linked to final closure of the matter. Please confirm. 38 General Please confirm / provide the following details: a. No. of transactions for outward supply in a month (State-wise) - B2B and B2C separately o Taxable supplies o Exempted supplies o Non-GST supplies o Export transactions b. No. of purchase invoices for a month (statewise), which are over 1 lakh c. No. of invoices on which RCM is paid in a month (state-wise) d. Whether bifurcation is available between inputs, input services, capital goods The same shall form part of the total price quoted as per Annexure - C to the RFP & may be charged under monthly bill after submission of the report to the Bank. The Bidder may be guided by the payment terms of the Bank specified in Annexure F to the RFP. Yes, the scope is limited to providing necessary assistance as elaborated above. The payment is not linked to final closure of the matter. a) The approximate volume of B2B transactions is close to 4 Lakh with approximately 50 Thousand invoices per month. The approximate volume of B2C transactions is close to 60 Lakh with approximately 35 Lakhs invoices per month b)approx No. of purchase invoices for a month (state-wise), which are over 1 lakh for the month of December is as follows Range( No of invoices) No Of States Invoices >1LAKH

15 & Above c) Approx No. of invoices on which RCM is paid in a month (state-wise) Range ( No Of Invoices) No Of States Invoices RCM Paid & Above d) Necessary bifurcation as per the requirement of the Bidder shall be made available.