Tax Administration Diagnostic Assessment Tool MODULE 11: ACCOUNTABILITY AND TRANSPARENCY

Transcription

1 Tax Administration Diagnostic Assessment Tool MODULE 11: ACCOUNTABILITY AND TRANSPARENCY

2 Desired Outcome of POA 9 The tax administration is : transparent in the conduct of its activities, and accountable to the government and the community. Background Accountability and transparency are the two central pillars of good governance. Their institutionalization reflects the principle that tax administration should be answerable for the way they use public resources and exercise authority. To enhance public confidence and trust, tax administration should be openly accountable for its actions within a framework of responsibility to the minister, legislature and the general public.

3 Engagement of citizens through stakeholder consultation and client surveys External oversight of the tax administration s financial and operational performance by parliament and supreme audit body Independent and impartial investigation by an ombudsman or equivalent Internal mechanisms to formulate and execute integrity/ethics policy and investigate misconduct International Good Practice in Accountability and Transparency POA 9 Regular reporting to senior management of actions on recommendations of ombudsman and anticorruption agency Internal audit ensuring adherence to internal control, risk management and governance framework Internal controls to protect the systems from fraud and error Embracing ethical standards and procedures to prevent misuse of office

4 Performance Indicators: P9 Accountability and Transparency High Level Indicators P9-25: Internal assurance mechanism M2 P9-26: External oversight of tax administration M2 P9-27: Public perception of integrity M1 P9-28: Publication of activities, results and plans M2 The level of assurance provided by internal audit Staff integrity assurance mechanism Extent of independent external oversight of the tax agency s operations and financial performance The investigation process for suspected wrongdoing or maladministration The mechanism for monitoring public confidence in the tax administration Extent to which the financial and operational performance of the tax administration is made public, and the timeliness of publication Extent to which tax administration s future directions and plans are made public, and the timeliness of publication Dimensions

5 Scoring P9-25-1: Level of assurance provided by internal audit IT system controls detect incidents that threaten the confidentiality and integrity of tax administration data; audit trails of user access exist; reports and audit tools available and used by internal audit There is a central repository of all internal control policies, processes and procedures The tax administration has an independent internal audit unit reporting directly to the audit committee A Systematic and independent review of internal audit operations and systems at least once every five years Annual internal audit program comprise of internal control checks, performance audits, IT systems audit and financial audits for all key operations. There is regular training of internal auditors in audit methodologies

6 Scoring P9-25-1: Level of assurance provided by internal audit IT system controls detect incidents that threaten the confidentiality and integrity of tax administration data; audit trails exist; reports and audit tools available and used by internal audit Internal control policies, processes, and procedures are adequately documented The tax administration has an independent internal audit unit reporting directly to the head or board B Systematic and independent review of internal audit operations and systems at least once every seven years Annual internal audit program comprise of internal control checks, performance audits, IT systems audit and financial audits for all key operations. There is regular training of internal auditors in audit methodologies

7 Scoring P9-25-1: Level of assurance provided by internal audit Audit trails of user access and changes made to taxpayer data exist There is NO central repository of all internal control policies, processes and procedures The tax administration has an independent internal audit unit reporting BUT does not report directly to the head or board C Systematic and independent review of internal audit operations does not exist Annual internal audit program comprise of internal control checks, and financial audits BUT NOT performance audits, IT systems audit There is ad hoc training of internal auditors in audit methodologies

8 Scoring P9-25-2: Staff integrity assurance mechanisms * The integrity statistics are publicly reported. * Maintains integrityrelated statistics for the agency, while preserving confidentiality. The tax administration has an independent internal affairs unit reporting directly to the head or deputy head. A * Cooperates with relevant enforcement and prosecution agencies. The internal affairs unit: * Has appropriate investigative powers, and exercises these powers with due process. * Provides leadership to the formulation of integrity and ethics policy, including codes of conduct.

9 Scoring P9-25-2: Staff integrity assurance mechanisms * The integrity statistics are NOT publicly reported. DOES NOT maintain integrity-related statistics for the agency, while preserving confidentiality. The tax administration has an independent internal affairs unit reporting directly to the head or deputy head. B * Cooperates with relevant enforcement and prosecution agencies. The internal affairs unit: * Has appropriate investigative powers, and exercises these powers with due process. * Provides leadership to the formulation of integrity and ethics policy, including codes of conduct.

10 Scoring P9-25-2: Staff integrity assurance mechanisms * The integrity statistics are NOT publicly reported. DOES NOT maintain integrity-related statistics for the agency, while preserving confidentiality. The tax administration has an independent internal affairs unit BUT DOES NOT report directly to the head or deputy head. C * DOES NOT Cooperates with relevant enforcement and prosecution agencies. The internal affairs unit: * Has appropriate investigative powers, and exercises these powers with due process. * DOES NOT provides leadership to the formulation of integrity and ethics policy, including codes of conduct.

11 Scoring P9-26-1: The extent of independent external oversight of operational and financial performance Annual external audit of the tax administration s financial statements by an external review body government auditor or other independent entity) External review findings and the response of the tax administration or ministry of finance are publically reported A Annual program of operational performance audits by an external review body (e.g., government auditor) External review findings are responded to by the tax administration

12 Scoring P9-26-1: The extent of independent external oversight of operational and financial performance Annual external audit of the tax administration s financial statements by an external review body government auditor or other independent entity) External review findings and the response of the tax administration or ministry of finance are NOT publically reported B Annual program of operational performance audits by an external review body (e.g., government auditor) External review findings are responded to by the tax administration

13 Scoring P9-26-1: The extent of independent external oversight of operational and financial performance Annual external audit of the tax administration s financial statements by an external review body government auditor or other independent entity) External review findings and the response of the tax administration or ministry of finance are NOT publically reported C NO program of operational performance audits by an external review body (e.g., government auditor) External review findings are responded to by the tax administration

14 Scoring P9-26-2: Investigation process for wrongdoing and maladministration A tax ombudsman investigates unresolved complaints from taxpayers. Systematic service and fairness problems are reported to the tax administration and minister. There is regular (i.e., monthly) and systematic monitoring to senior management and reporting of actions taken in response to recommendations of ombudsman or anti-corruption agency. A An anti-corruption agency oversees tax administration anticorruption policies and investigates alleged corrupt conduct

15 Scoring P9-26-2: Investigation process for suspected wrongdoing and maladministration A tax ombudsman investigates complaints from taxpayers. Systematic service and fairness problems are not reported to the tax administration and government. There is regular (i.e., monthly) and systematic monitoring and reporting of actions taken in response to recommendations of ombudsman or anti-corruption. B An anti-corruption agency oversees tax administration anticorruption policies and investigates alleged corrupt conduct

16 Scoring P9-26-2: Investigation process for suspected wrongdoing and maladministration A tax ombudsman or equivalent authority exists BUT on an AD HOC basis Limited evidence that findings and recommendations of investigative agencies are acted upon systematically. C An anti-corruption agency exists BUT only investigates cases of alleged corrupt conduct. Does NOT oversee the anti-corruption policies

17 Scoring P9-27: Mechanism of monitoring public confidence in the tax administration A B C D Independent third party survey based on statistically valid sample to monitor level of public confidence Conducted at least every 2 years Results of survey are made public within 6 months of completion Tax administration takes the survey results into account for reviewing its integrity framework and public relations Independent third party survey based on statistically valid sample to monitor level of public confidence Conducted at least every 3 years Results of survey are made public within 9 months of completion Tax administration takes the survey results into account for reviewing its integrity framework and public relations Asurvey -conducted by tax administration itself or independent third party - based on statistically valid sample to monitor level of public confidence Conducted at least every 4 years Results of survey are made public within 9 months of completion Tax administration takes the survey results into account for reviewing its integrity framework and public relations The requirements for a C rating or higher are not met.

18 Scoring P9-28-1: Extent to which the financial and operational performance of the tax administration is reported A B C D A report to the government is produced on an annual basis outlining the full financial and operational performance of the tax administration for the immediate past fiscal year. The report is made public within 6 months of the end of the fiscal year A report to the government is produced on an annual basis outlining the full financial and operational performance of the tax administration for the immediate past fiscal year. The report is made public within 9 months of the end of the fiscal year A report to the government is produced on an annual basis outlining the full financial and operational performance of the tax administration for the immediate past fiscal year. The report is made public within 12 months of the end of the fiscal year The requirements for a C rating or higher are not met.

19 Scoring P9-28-2: Extent to which the tax administration s future directions and plans are published A B C D Strategic and operational plans are made public in advance of the period covered by the plans. Strategic and operational plans are made public within 3 months of the start of the period covered by the plans. Elements of the plan are made public within 3 months of the start of the period covered by the plans. The requirements for a C rating or higher are not met.