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Audit approach overview
Our audit approach will allow our client's accounting personnel to make the maximum contribution to the audit effort without compromising their ongoing responsibilities
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Annual and short period audit
At P&A Grant Thornton, we provide annual and short period financial statement audit services that go beyond the normal expectations of our clients. We believe strongly that our best work comes from combining outstanding technical expertise, knowledge and ability with exceptional client-focused service.
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Review engagement
A review involves limited investigation with a narrower scope than an audit, and is undertaken for the purpose of providing limited assurance that the management’s representations are in accordance with identified financial reporting standards. Our professionals recognize that in order to conduct a quality financial statement review, it is important to look beyond the accounting entries to the underlying activities and operations that give rise to them.
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Other Related Services
We make it a point to keep our clients abreast of the developments and updates relating to the growing complexities in the accounting world. We offer seminars and trainings on audit- and tax-related matters, such as updates on Accounting Standards, new pronouncements and Bureau of Internal Revenue (BIR) issuances, as well as other developments that affect our clients’ businesses.
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Tax advisory
With our knowledge of tax laws and audit procedures, we help safeguard the substantive and procedural rights of taxpayers and prevent unwarranted assessments.
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Tax compliance
We aim to minimize the impact of taxation, enabling you to maximize your potential savings and to expand your business.
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Corporate services
For clients that want to do business in the Philippines, we assist in determining the appropriate and tax-efficient operating business or investment vehicle and structure to address the objectives of the investor, as well as related incorporation issues.
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Tax education and advocacy
Our advocacy work focuses on clarifying the interpretation of laws and regulations, suggesting measures to increasingly ease tax compliance, and protecting taxpayer’s rights.
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Business risk services
Our business risk services cover a wide range of solutions that assist you in identifying, addressing and monitoring risks in your business. Such solutions include external quality assessments of your Internal Audit activities' conformance with standards as well as evaluating its readiness for such an external assessment.
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Business consulting services
Our business consulting services are aimed at addressing concerns in your operations, processes and systems. Using our extensive knowledge of various industries, we can take a close look at your business processes as we create solutions that can help you mitigate risks to meet your objectives, promote efficiency, and beef up controls.
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Transaction services
Transaction advisory includes all of our services specifically directed at assisting in investment, mergers and acquisitions, and financing transactions between and among businesses, lenders and governments. Such services include, among others, due diligence reviews, project feasibility studies, financial modelling, model audits and valuation.
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Forensic advisory
Our forensic advisory services include assessing your vulnerability to fraud and identifying fraud risk factors, and recommending practical solutions to eliminate the gaps. We also provide investigative services to detect and quantify fraud and corruption and to trace assets and data that may have been lost in a fraud event.
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Cyber advisory
Our focus is to help you identify and manage the cyber risks you might be facing within your organization. Our team can provide detailed, actionable insight that incorporates industry best practices and standards to strengthen your cybersecurity position and help you make informed decisions.
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ProActive Hotline
Providing support in preventing and detecting fraud by creating a safe and secure whistleblowing system to promote integrity and honesty in the organisation.
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Accounting services
At P&A Grant Thornton, we handle accounting services for several companies from a wide range of industries. Our approach is highly flexible. You may opt to outsource all your accounting functions, or pass on to us choice activities.
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Staff augmentation services
We offer Staff Augmentation services where our staff, under the direction and supervision of the company’s officers, perform accounting and accounting-related work.
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Payroll Processing
Payroll processing services are provided by P&A Grant Thornton Outsourcing Inc. More and more companies are beginning to realize the benefits of outsourcing their noncore activities, and the first to be outsourced is usually the payroll function. Payroll is easy to carve out from the rest of the business since it is usually independent of the other activities or functions within the Accounting Department.
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Our values
Grant Thornton prides itself on being a values-driven organisation and we have more than 38,500 people in over 130 countries who are passionately committed to these values.
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Global culture
Our people tell us that our global culture is one of the biggest attractions of a career with Grant Thornton.
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Learning & development
At Grant Thornton we believe learning and development opportunities allow you to perform at your best every day. And when you are at your best, we are the best at serving our clients
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Global talent mobility
One of the biggest attractions of a career with Grant Thornton is the opportunity to work on cross-border projects all over the world.
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Diversity
Diversity helps us meet the demands of a changing world. We value the fact that our people come from all walks of life and that this diversity of experience and perspective makes our organisation stronger as a result.
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In the community
Many Grant Thornton member firms provide a range of inspirational and generous services to the communities they serve.
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Fresh Graduates
Fresh Graduates
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Students
Whether you are starting your career as a graduate or school leaver, P&A Grant Thornton can give you a flying start. We are ambitious. Take the fact that we’re the world’s fastest-growing global accountancy organisation. For our people, that means access to a global organisation and the chance to collaborate with more than 40,000 colleagues around the world. And potentially work in different countries and experience other cultures.
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Experienced hires
P&A Grant Thornton offers something you can't find anywhere else. This is the opportunity to develop your ideas and thinking while having your efforts recognised from day one. We value the skills and knowledge you bring to Grant Thornton as an experienced professional and look forward to supporting you as you grow you career with our organisation.
Which of these cases would you prefer?
Case 1: You receive an assessment from the Bureau of Internal Revenue (BIR) after failing to pay taxes. You protested it, but eventually, lost the case and paid the corresponding deficiency tax, plus interest and other penalties.
Case 2: You receive an assessment from the BIR due to your alleged failure to pay taxes. You protested it. BIR subsequently issued a collection letter, then a Warrant of Distraint and/or Levy (WDL) and, eventually, collected the alleged deficiency taxes through garnishment. You filed a case with the Court of Tax Appeals (CTA), and won. Accordingly, the CTA ordered the BIR to refund the erroneously collected taxes.
Some would prefer the second case, which results in a refund from the BIR. However, most would rather not be involved in either case because the taxpayers in any event are at the losing end. Although in Case 2, the taxpayer was able to win a refund, he will have failed to recover the foregone interest on erroneously collected taxes (and, of course, the additional cost of litigation). The taxpayer could have earned more had these funds been applied to operations. This is the sad reality of taxes: if you owe the government, you pay, including interest and penalties; if the government owes you, the government will refund the amount, but without interest. The longer the process takes, the more disadvantageous to the taxpayer.
Some taxpayers would probably ask if there is an instance where interest may be imposed on a refund, especially if there is a delay on the part of the government. Yes, there is. In the Supreme Court (SC) decision in G.R No. 198756 (Banco De Oro, et. al. vs. Republic, et. Al.), the Bureau of Treasury (BoT) was held liable to pay legal interest of 6% per annum on the amount of final withholding tax. It was imposed against the government due to the BoT’s unjustified refusal to release the funds to be deposited in escrow, despite the SC’s orders.
In CTA Case No. 9437 dated Aug. 31, 2018, the CTA further explained that the condition where interest may be imposed on the amount of refund — i.e., it must either be authorized by law or the collection of the tax was attended by arbitrariness.
In the said case, the taxpayer received a Preliminary Collection Letter (PCL) demanding the payment of alleged deficiency income tax and VAT and compromise penalty. Afterwards, the BIR issued a WDL. Thereafter, the BIR issued Warrants of Garnishment to the taxpayer’s banks. One of the banks then placed the taxpayer’s deposit account amounting to P17 million in a separate block account, prompting the taxpayer to file a Petition for Review with the CTA with an Urgent Motion for the Issuance of an Order to Suspend the Collection of Tax. However, while waiting for the CTA’s resolution on the motion to suspend the collection of taxes, the BIR issued an Order for Delivery of checks amounting to P17 million to the bank, to which the bank complied.
The taxpayer filed an amended petition for review, which sought to refund the amount garnished since the assessment has no basis. It also sought damages equivalent to the legal interest rate of 6 % per annum on the garnished amount computed from the date of the BIR’s collection until the full refund.
With regard to the merit of the assessments, the CTA ruled in favor of the taxpayer. The assessment was cancelled on the following grounds: (1) The BIR failed to prove that the taxpayer actually received the Preliminary Assessment Notice (PAN) and Final Assessment Notice (FAN); (2) The PAN and FAN were void, since these were issued pursuant to Letter Notice only without any Letter of Authority; and (3) The right of the BIR to assess the taxpayer had prescribed.
Consequently, the CTA ruled that, since the PAN and FAN are void, the WDL is, likewise, void. The tax authority has no right to collect the amount of P17 million from the taxpayer and, therefore, the BIR erroneously or illegally collected the said amount. The taxpayer is entitled to refund the same.
The CTA, however, denied the taxpayer’s request to impose interest on the erroneously collected taxes. The CTA pointed out that, for the payment of interest to accrue on the amount to be refunded to the taxpayer, it must be either authorized by law or the collection of the tax was attended by arbitrariness.
The 1997 Tax Code, as amended, however, does not contain any provision for interest in case of improperly collected taxes. Hence, interest cannot be imposed on taxes to be refunded, even if the BIR is the one at fault, which resulted in the erroneous collection of taxes.
Arbitrariness, on the other hand, presupposes inexcusable or obstinate disregard of legal provisions. As explained by the CTA, an action is not arbitrary when it is exercised honestly and upon due consideration where there is room for two options, however much it may be believed that an erroneous conclusion was reached. In the case at bar, there was no legal provision violated when the BIR collected the garnished amount during the pendency of the proceeding on the Urgent Motion for the Issuance of an Order to Suspend the collection of tax.
As a general rule, an injunction is not available to restrain the collection of tax pursuant to Section 218 of the 1997 Tax Code, as amended. However, the suspension of collection may be allowed if, in the Court’s opinion, the collection may jeopardize the interest of the government and/or taxpayer pursuant to Section 11 of Republic Act (RA) No. 1125, as amended by RA No. 9282.
Since there was no order yet from the CTA to suspend the collection of tax, the BIR was not precluded from collecting the said amount.
I could just imagine how much income the taxpayer in the cited CTA case could have earned in using the P17 million to fund operations. Placing that amount in an investment that yields an annual return of 3% could earn half a million per year.
It is about time our lawmakers consider in the proposed TRAIN 2 (or TRABAHO Bill, as it is now called) a provision imposing interest on a refund due to the fault or delay caused by the government. Imposing interest on a refund is not unusual. In fact, some countries such as Australia, India, Singapore, and Malaysia allow interest on refunds. Such a provision will safeguard the rights of taxpayers and help the government ensure that the refund and assessment process are performed in a timely manner and with due diligence.
We hope our lawmakers, in drafting TRAIN 2, not only focus on revenue generation, but on creating a tax law that is fair, adequate, simple, transparent, and administratively easy so that taxpayers could say that we have a Tax Reform for Attracting Better and High-Quality Opportunities (TRABAHO).
Edward L. Roguel is a partner of the Tax Advisory and Compliance of P&A Grant Thornton. P&A Grant Thornton is one of the leading audit, tax, advisory, and outsourcing services firms in the Philippines.
As Published in BusinessWorld dated 24 September, 2018