Faculty of Economics and Management Academic year 2020/2021

Ibn Tofail University, Kenitra

Thesis
Presented to
The Faculty of Economics and Management

For obtaining the

Fundamental License in Economic and Management Sciences

Under the theme
THE TAX AUDIT

Produced by

ELOUIZI MONA ;18004770 ; GESTION FINANCIERE

LAALALMA SOUFIANE ; 18001831 ; GESTION FINANCIERE

Framed by
Pr. Khalid El Hajioui
 SUMMARY
Chapter 1: General Information About Tax Audit:
Introduction
Section I: The concept of tax audit:
I. Definition and objective of the tax audit:
II. The role of the tax auditor and their profit
III. The limits of tax auditing

Section II: the statuses of the tax audit:

I. The tax audit measures the tax risk.
II. The tax audit allows assessing the tax performance of the company.
III. The status of the tax auditor

Conclusion
Chapter 2: The Approach and Elements of Tax Audit
Introduction
Section I: the approach of the tax audit
I. General awareness

II. Examination of the internal control system and the information system:
Section II: the elements of the tax audit
I. Compliance Audit
II. Opportunity audit

Conclusion
Chapter 3: the tasks performed and the completion of the tax audit within
of Soriac
Introduction
Section I: The tasks performed and the problems detected
I. The tasks completed
II. The detected problems

Section II: The implementation of a tax audit within SORIAC

 INTRODUCTION

The audit is an examination of information by an independent professional using a

specific investigation methodology implemented with reference to work standards
dans le but d’émettre une opinion sur cette information.
Often endured and experienced as a source of risk, taxation has been for many years
years considered as a complex and costly dimension. Gradually, the perception of the
taxation has evaluated. It has evaluated in the sense of greater attention being paid to the issues
affecting the legal security of the company's operations.
Taxation is the set of legislation and regulations in force in the field of
fiscal, the practices and measures specific to the tax administration, tax levies
and other mandatory levies. It is considered one of the concerns
Major constraints of the company, it is a constraint whose control is difficult.
The tax audit is a tool for detecting tax risks and improving the
risk management through the corrective measures it can suggest.
The interest in resorting to tax auditing is justified either to better prepare for
tax audits, either to determine the liability guarantee clause in the event of an operation
business acquisition.
The present report is titled: 'the tax audit', allows to answer the questions
following:
What are the different sources of tax risks?
What is the process of a tax audit?
And what are the elements of the tax audit?
Chapter 1: Generalities on Fiscal Audit:
Section I: The concept of tax audit:

I. Definition and objective of the tax audit:

1. Definition of the tax audit:

Several definitions have been proposed and suggested to best define a vague notion.
According to Colin Hackings Gary, the audit is "a critical examination of the information provided by
the company1". This definition presents the audit as a simple diagnosis of the data and
information presented by the company. But it turns out to be insufficient, as it does not take
do not take into account the information that has not been provided and communicated.

According to ATH2, the audit is 'the examination of information with a view to expressing an opinion on that information'
a responsible and independent opinion based on a quality criterion, this opinion
must increase the usefulness of the information.

So the audit is an assessment of information based on specific criteria. It is the

first step towards improvement. It allows for an objective and clear view of a mode
of operation or of a situation.

The tax audit is a tool to assess the entire fiscal structures of

the company and its operations. It is a critical examination of the situation and the context
business tax in order to make an assessment.

The tax audit allows for the establishment of a diagnosis of the company's tax obligations and to
propose solutions to reduce tax burdens.

2. Objective of the tax audit:

The tax audit pursues two main objectives which are:

The control of tax compliance: This is a control aimed at

to ensure the reliability of information with fiscal aspects. It also allows for identifying
the anomalies, their origins and the fiscal risks in order to detect offenses
potential audits and prepare for the tax audit.
Tax compliance is the analysis of the treatment reserved for issues.
tax matters within the audited company, where the tax auditor will question
the existence of specialists to carry out accounting recording accordingly
tax-related and to know whether the company consults tax advisors or not.

The control of tax efficiency: This is a control aimed at measurement.

of the company's predisposition to take advantage of benefits and opportunities
what the law offers in terms of taxation. This control is based on two types of choices: the
The first are tactical choices related to the current management of the company. This is in the capacity of
 for example: the method of depreciation, the VAT option scheme, etc. While
The second ones are strategic choices on an occasional basis.

The control of tactical choices is considered a simple control by appealing to

traditional audit tools such as questionnaires, direct examinations of
accounts and accounting documents. The tax auditor checks the main tax choices and
the risk elements related to these choices. It highlights the provisions that were omitted and ignored.

While, for the control of strategic choices, the audit allows for bringing together complexity
project audit at the level of the skills of the people who dealt with the issues
tax authorities to examine whether there is a shortfall or potential risks incurred.
In general, the audit at this level will determine the extent to which the issue is taken into account.
tax efficiency.

II. Role of the tax auditor and its benefit:

The tax auditor's mission is to ensure compliance with tax obligations by the company. He
conduct a regularity check that will allow the company to know not only its
errors, but also the risk they generate.

Indeed, the tax auditor assesses the company's ability to utilize the opportunities available to it.
offers tax legislation in the form of tax benefits, financial advantages, planning
fiscal and thus its ability to be effective in its tax management.

The examination of all tax aspects leads to the development of the tax health report.
It is a tax diagnosis that is considered one of the elements of the general diagnosis.
the company.

The tax auditor must have a perfect knowledge of the regulations and the doctrine.
tax and an ability to better manage difficulties in order to benefit from the advantages and
tax opportunities. He will seek the adaptation of structures allowing the company a
Tax relief.

The tax audit is therefore the set of studies and reflections allowing for evaluation
accounting and administrative procedures within the company in order to ensure that everyone
interested (shareholders, employees, managers, and third parties) in the regularity and sincerity of the information
Communications. The interest of the tax audit is to:

Preparing as best as possible for tax audits: the audit provides information about
the existence or absence of a tax risk.
This verification is generally conducted in a punctual manner. In other words, either
before the request for a tax credit refund or before the audit conducted
by the tax administration.
Managing tax risk is considered part of risk management.
the company: fiscal risk leads not only to financial consequences,
but it can harm the reputation of the company and itsreputation.

III. The limits of tax audit:

Given the importance, complexity, and instability of tax legislation, tax risks
arise from all sides. However, the tax audit remains unable to detect all the
irregularities. Because the latter are difficult and delicate to assess.

1. The limits related to the constraint of the mission's time:

The tax auditor is not permanently present in the audited company. He intervenes according to
a pre-established calendar for a well-defined period. Its limited intervention
over time, carries fiscal risks. It proceeds with an estimate through the
surveys. These allow him to obtain a conviction rather than a certainty.

The tax audit mission does not constitute a guarantee in the context of a tax audit.
further revealing of tax irregularities. The responsibility of the tax auditor cannot
to be implicated. Because its mission is placed in the context of an advisory mission. And by
conséquent, l’auditeur fiscal n’a pas une obligation de résultat mais de moyens.

2. The limits related to the delicate assessment of tax risk:

If the rules are precise, well-defined, and concern obligations either of form or of
Delay, their control does not raise any difficulty. However, that is not always the case.
generality of the text, the permanent evolution of tax legislation offers the possibility of
determine a set of objective criteria in order to characterize the existence of
the irregularity of his absence. "Indeed, the character is regular 14 or irregular in regard to the
Tax risk is therefore partially dependent on the assessment of the controller or auditor.
fiscal5

So the tax audit is a method of detecting tax risks. It allows in the first
Place to ensure that the company complies with its tax obligations to which it is subject.
In other words, it must comply with the tax rule. And secondly, he must verify
if the company opposes tax risks or exposes itself to non-compliance with the rule
fiscal. "It is important to submit the accounts for control in compliance with
the regulations in force. And to establish a risk matrix in order to stop the
necessary recommendations.

Every company has an interest in regularly conducting a tax audit. This is about complying
the principle that "prevention is better than cure."

A tax audit allows for correcting and rectifying certain errors in order to avoid a potential recall.
to a tax audit.

The majority of tax audits are motivated solely by formal irregularities that
can be avoided. Thus, the purpose of the tax audit is to discover the means to allow
to reduce taxes. It will be useful in case of a project to sell a company, called an audit.
seller in order to reassure potential buyers. It can also be useful in case of
project to purchase a company in order to verify the absence of risks.
Section II: the statutes of tax audit:

I. The tax audit measures tax risk:

1. The nature of fiscal risk:

Tax control is defined as the power granted to the tax administration to rectify the
omissions, deficiencies or errors in taxation made by taxpayers. It is
the logical and indispensable corollary of any declarative system. Indeed, the fact for a
A company's failure to comply with tax regulations exposes it to penalties in the event of an audit.
This risk of control particularly draws the company's attention as the administration accompanies it.
of the control power, has the power of correction and sanction.

a. Compliance with tax regulations is the subject of control by the administration.

The counterpart of the declarative system lies in the possibility granted to the administration.
tax authorities to verify the accuracy of the declarations submitted by taxpayers. If the tax
is not always a well-accepted constraint, control is certainly even less so;
but in any case, control remains a necessary evil. Indeed, it should be remembered that the
Taxes collected in Tunisia account for over 80% of its own resources, which highlights
the necessity for the State to implement measures to control the payment of
these samples.

In order to ensure compliance with tax regulations, the legislator has equipped the administration with
various control methods.

Preliminary verification
The thorough verification

b. The control power of the administration is accompanied by a power of

rectification and sanction

The finding of irregularities can lead to heavy penalties for the company.
the administration having not only a recovery power allowing it to implement
recovery of evaded taxes, but also a power of sanction.

The administration has the power of recovery.

The administration has the power to sanction.

2. The areas of tax risks

According to an approach inspired by the work of PricewaterhouseCoopers, tax risks

can be analyzed and grouped into seven areas, the combined total of which constitutes the
company's tax risk portfolio:

Transaction risks.
The risks of the situation.
 Operational risks.
The compliance risks.
The accounting risks.
Management risks.
Reputational risks.
The company's tax risk portfolio.

3. The measurement of tax risk

The determination of risk areas and sources allows for the creation of a list of risks.
tax risks to which the company could be exposed.
The tax audit is an exercise aimed at validating a company's tax burden.
as well as the identification of the tax risks to which this company may be exposed
failure to comply with tax regulations.
For a good approach to measuring tax risk, it is necessary to distinguish between two concepts:
risk in the base and risk in rights.
Base risks: It corresponds to the estimated amount of the increase in the taxable result of
the exercise considered;
Risks-in rights: It corresponds to the additional tax resulting from the year in question,
from the consideration of this enhancement.
In the simplest scenario where the entity is a beneficiary for the relevant fiscal year,
after taking into account any potential carryforward deficits, the risk in rights corresponds to
the IS calculated on the amount of the risk base.
The calculated risk in rights does not necessarily constitute a definite risk. Indeed, the
The definitive risk must be calculated taking into account any potential reduction perspectives.
subsequent increase in the taxable base caused by the adjustment.
The risk related to the non-deductibility of an expense that has only one consequence a
reintegration under the exercise of commitment of liability and no subsequent consequences
is not to be expected, it is qualified as a definitive risk. When the risk in rights is definitive, the
The adjustment cost is the principal tax to which late penalties are added.
Without claiming to provide a comprehensive list of definitive tax risks, we will limit ourselves to illustrating the
tax risks in the following places that have a definitive nature:

The interest not computed or computed at a rate lower than the rate of 8% in respect of
amounts made available by the company to the partners (article 48-VII of the code
of personal income tax and corporate tax;

Unjustified expenses without supporting documents. However, when the risk is

only related to the erroneous consideration of a product or a charge over time
(provision, error of allocation of a product or expense), it is not about
that of a temporary risk, also called 'timing risk'.

In this case, the final cost of the correction is usually limited to late penalties.
If the risk concerns a provision, the risk of adjustment due to the identified enhancement.
the exercise of provisioning must be tempered by the corresponding deduction
which can be carried out in the tax result of the recovery and recognition exercise
definitive of the deductible charge. The definitive risk at baseline is then nil, except in
the hypothesis of a reduction in the corporate tax rate between the allocation period and the reversal period
and definitive acknowledgment of the burden, in which case the risk would then be limited to the differential
of tax.
 Impact on the corporation tax (Deduction in)
cascade)

Taxes Amounts Amounts Definitive Detming

Risque Incidence Cart Reference
Taxes declared who based positive or Referral to
on the IS
on base could (gap (Missing a page or
Deduction
to be negatf) Principal Penalties Principal Penalties to win an annex
in
claimed late of or
on base cascade
retard payments
Indus

In the event of a tax audit, of course.

Although in general, taxes and duties other than corporate tax generate a risk in rights.
definitive and not 'timing', the tax auditor should take into account the rule of the
cascading deduction.
Indeed, the cascading deduction rule applies to all adjustments.
deductible taxes (VAT, FODEC, consumption tax, TCL, TFP,
FOPROLOS, Registration fee, etc.).
Taxpayers can request that the additional simple rights resulting from
a verification may be accepted as a deduction from the increases made to the bases
other taxes were also checked.
This is how, in the event of simultaneous verification of VAT and other deductible taxes
(TCL, TFP, FOPROLOS, etc.) and IS, when verifying the TCA or other
deductible taxes lead to a tax reminder, tax surcharges in
principals can be deducted from the base subject to corporate tax. This allocation applies
even if the verification did not result in a rise in IS in which case it leads to
the creation of a tax credit.
This generally accepted principle has been confirmed by administrative doctrine.
Tunisian in its fullness from the year 2004.

For timing risk, the auditor should distinguish between two types of
risks :
Incorrect accounting in the audited period of a product or an expense other than
Depreciations or provisions: Possibility to benefit from the correction rule
symmetric. In this case, the final cost of the adjustment is limited to the penalties of
retard.
Incorrect accounting during the audited period of a product or an expense other than
depreciations or provisions: Possibility of benefiting from the correction rule
symmetric. In this case, the final cost of the adjustment is limited to the penalties of
slow down.
This treatment remains the same for the provisions that have not been reintegrated during
from their constitution and which were repeated during the audited period and which have not
were deducted.
Provisions established: the identified risk of enhancement for the fiscal year of
The allocation of the provision must be tempered by the corresponding deduction that may be.
carried out in the fiscal result of the year of recovery and definitive recognition of
the deductible charge. The final risk at base is then zero, except in the hypothesis
 a reduction in the corporate tax rate between the allocation period and the recovery period and
final determination of the charge, in which case the risk would be limited to the differential
tax.

II. The tax audit allows for the assessment of fiscal performance
the company
One could argue that in the current state of a dense and evolving legislation without
discontinue, the company that manages to meet its tax obligations while remaining sheltered
penalties, fines or adjustments already represent a performance.
Good management of the tax parameter and the opportunities it offers is likely to
to provide the company engaging in it with an undeniable competitive advantage, a source of value.
As Mr. Schmidt indicated, companies "have the opportunity to anticipate tax and use
at most the means provided by a tax law that offers multiple choices.
The possibility of adopting more or less timely measures in fiscal matters thus justifies
the interest for the company to submit its guidelines to a specialist in the field
fiscal, its fiscal choices, in order to see whether it demonstrates effectiveness in this matter or not.
However, the relevance of the objective assigned to the tax audit cannot truly emerge.
by highlighting the extent of the situations in which the company can be
more or less effective from a tax perspective. It is therefore appropriate to first study what
constitutes the area of tax efficiency and, consequently, the area of
effectiveness control within the framework of the audit. However, the concept of tax effectiveness, which
constitutes the control criterion, remains somewhat abstract in itself; it is therefore important to
clarify the content to highlight its richness and scope, and thus justify it
the interest of a tax audit.

The area of tax efficiency control

The consideration of the tax parameter in business management can be carried out by the
decision biases that can be classified as legal or tax decisions, but also
through very diverse decisions that can be qualified as opposed to extra-judicial decisions
or extra taxes, for which the company seeks less to manage the tax itself than
the incidence of the tax.
By legal or fiscal decisions, it should be understood the decisions whose implementation
involves actions of a legal or tax nature. It is the aspect of tax management that
concerns the determination of tax, the company's tax debt. It is in this
category of decisions that the company draws particularly from the ability to exploit the margin of
tax maneuver at her disposal.
By extra-judicial or extra-fiscal decisions, we mean decisions that are not
that are inspired by fiscal considerations. The implementation of such decisions is beyond
completely in the legal or tax field. In other words, the company seeks to minimize,
or at least, to arrange, the impacts of a given tax situation. One does not seek the
best tax solution, we aim to optimize the benefits of a known tax solution.
This distinction does not imply autonomy; on the contrary, there is often continuity.
between legal or tax decisions and extrajudicial or extrafiscal decisions. In
Indeed, once a solution has been chosen for tax purposes, the company retains the possibility of going
further and to try to optimize the impacts, using borrowed means
notably in financial management, so that the overall cost is actually the lowest
possible. Extrajudicial or extrafiscal decisions are therefore downstream of decisions.
legal or tax.
The tax audit does not concern these two types of decisions which, even if they are part of
a certain continuity are markedly different. The field of tax auditing is the
control of the company's legal or tax decisions.
The tax audit remains foreign to the control of extra-judicial or extra-fiscal decisions, in
the extent to which these decisions, which do not require specific skills in tax matters,
are much closer to financial management, with which they can integrate, than to
tax management.
The tax audit does not coincide, consequently, with the control of tax management.
The field of tax audit is more restricted. However, it focuses on one of the key elements.
in the tax management of the company: The exercise of tax choices. Indeed, the tax audit
corresponds to the monitoring of the use of tax choices.

The tax audit, which should not be forgotten that it is, like any audit, an examination
deepened operations by a specialist, will focus more on the choice of the best
fiscal solution only for the subsequent optimization of the impacts of such a choice.
The tax audit must therefore allow for the control of the company's ability to
use the range of legal or tax decisions at one's disposal to determine their
clean tax situation; the tax audit appears as the control of what has been agreed
to call the company's tax choices.
The contractual control of tax efficiency therefore requires seeking a classification.
fiscal choices.

a. The tax audit is based on a classification of tax choices

The tax efficiency of the company is the result of tax decisions, or implications.
fiscal decisions that each contribute, but in varying degrees, to effectiveness
fiscal.
As part of a contractual audit, considering the time constraints and
the material impossibility of reviewing all the choices made by the company,
The auditor will primarily focus on the company's decisions with a significant impact.
fiscal.
The interest of the distinction between strategic choices and tactical choices also lies in the
determination of the audit approach to be applied.
Drawing inspiration from the financial audit, the tax auditor should apply for non-operations.
running a corroborative strategy (compliance and opportunity audit techniques)
extensive or widespread) due to the fact that the risk associated with control is maximum or very close to it
maximum.
For tactical tax choices, the approach to be adopted by the tax auditor varies depending on
the reliability of the internal tax control system. Indeed, if the tax auditor believes that the
control mechanisms are indeed effective and applied in a way that justifies the
low level of risk related to control, it could plan compliance audit tests and
of restricted or limited opportunity. However, if the tax auditor believes that the controls are
ineffective or nonexistent, it should apply a corroborative strategy.
It is therefore possible, under these conditions, to differentiate tax choices based on their scope, in
thus distinguishing the decisions that correspond to the choice of major fiscal orientations
of the company, that is to say the choices that will determine the tax characteristics of
the company, choices of everyday management, with more limited fiscal scope but which can
occasionally provide an advantage to the company. Two levels of choice emerge then
strategic choices and tactical choices.

Strategic choices
Tactical choices

b. The control of tax choices

The existence of tax choices is to be associated with the behavior of the company. If the company
ignores the possibilities offered to him directly or indirectly by tax legislation, he
results in a passive behavior that may be detrimental to it. If on the other hand, the company
shows an active attitude towards tax choices, it can then exercise good or
bad choice.
The role of the audit is precisely to highlight the shortcomings that result from a
passive behavior of the company or of reporting errors related to a priori choices
exercised with full knowledge of the facts. The tax audit must therefore raise awareness
the company emphasizes the gap that exists between potential tax efficiency and actual efficiency
fiscal impact. In this way, the company must adopt measures that should allow it to
to strive for the optimization of its tax choices, to gradually improve its efficiency
tax. Gradually, the company must become, according to M. Cozian's formula, a
an informed taxpayer who manages taxation 'at a higher level'. By making such an effort,
the company avoids a waste of its resources that would be due to a sub-optimization of
these tax decisions.
The control of tax choices is not limited to a simple observation of the level of effectiveness.
fiscal practices that the company demonstrates. Since the control of regularity has virtues
preventive measures, the control of effectiveness contributes to strengthening tax efficiency
the company. It contributes not only by verifying the company’s ability to operate the
good tax choice, but also by highlighting the unknown choices of the company. From
In this way, the audit enriches the range of choices available to the company, and by extension
consequence, the potential for tax efficiency. The control of tax choices thus emerges
as a factor of efficiency.
This second phase of the tax audit mission must highlight the operations that
the company could or could have dealt with tax matters more appropriately.
The company's tax efficiency relies on the pursuit of three distinct types of benefits.
(tax, financial or operational) through strategic choices or choices
tactics employed by the company.

2. The criterion for the control of tax effectiveness

Noticing that there is a fiscal leeway for the company, a zone

of autonomy in determining one's own tax situation, one can conclude that
the company can make use of it more or less wisely and gain an advantage
economic of variable scope.
But beyond the principles, it is important to clarify the tax efficiency criterion from which
The auditor will determine their opinion. Indeed, it is appropriate to specify the elements that will
allowing the listener to appreciate the opportunity of a choice or a tax option
However, on this point, we must acknowledge that the company must actually demonstrate a
double level of tax efficiency.
The company must be efficient in the use of the provisions contained in the legislation.
that is to say to be able to take advantage of the legal and tax potential at one's disposal.
In other words, it is the company's ability to use the 'fiscal material' with
effectiveness. However, one cannot consider tax efficiency for its own sake.
The handling of taxation is not the subject of an independent function within the company.
totally autonomous and functioning independently. Tax law, like other branches
the right does not live separated from the activity of the company; it is not isolated from other parameters
of management.
From then on, tax efficiency cannot be reduced to the pursuit of fiscal optimum.
strictly and exclusively based on tax considerations; it instead implies the
take into account other company data regarding general policy.
The auditor must thus perform a review of the tax choices according to a dual standard; of a
part, to assess the company's ability to utilize the legal and tax resources it
dispose and, on the other hand, ensure that these resources are used in accordance with
directions of the general policy of the company. Beyond the principle, however, the risk
It is important to consider the tax variable on its own, detached from the context of
the company.
Under these conditions, the objective pursued by the company remains the systematic search for the
the voice is less imposing; an autonomous tax strategy is juxtaposed, or where applicable
substitute, to the company's strategy. The existence of such a risk requires the auditor to
check the company's ability to reconcile tax strategy and business strategy.

a. The assessment of the company's ability to exploit resources

legal and tax matters it has at its disposal:

The company's ability to be effective from a tax perspective assumes primarily that
this one must be able to know precisely the extent of the leeway it has
dispose. In other words, for the company to have the opportunity to make a choice
Enlightened, it is important that she has previously listed the various alternatives available to her.
she.
In terms of tax audit, it is not enough for the auditor to verify that the choices made are
justify in the context of the company; it must first ensure that
the company did not have other solutions, other possibilities available to it by the
legal and tax legislation that would have made it possible to achieve the same result, or
even to provide the company with a significantly greater advantage. It is in fact about
check that the bases on which the choice was made have been correctly determined.
It is therefore, at first, the company's ability to master the legal tool and
fiscal, to use the resources of law for the benefit of business management which is the subject
of audit.
On this point, the tax audit will particularly rely on an examination of the information system of
the company in order to assess the possibilities left to it to identify the different
tax solutions applicable to a given problem.
This phase is an essential prerequisite. It allows us to verify that the favorable conditions
the exercise of an appropriate choice is gathered, and that the conditions for efficiency are not
mortgaged from the start due to a failing information system.
The importance of this control phase takes on particular significance in companies of
small or medium-sized. Indeed, large companies generally have a
tax function, or at least one or more collaborators specialized in processing
tax questions. However, in SMEs, the legal and tax information that
dispose
The company is generally a basic legal information.
The company must be able to make tax decisions that are both
best, taking into account the possibilities allowed by the legislation or regulation, but
also the most suitable considering the company, its situation, its objectives and its
means. This is the second level of fiscal efficiency: there must be a match between the choices
fiscal and business management.

b. Le contrôle de l’aptitude de l’entreprise à exploiter les ressources

legal and tax according to its general policy choices

The objective of the tax audit is to ensure that the tax parameter is best integrated into the
management of the company, that the various tax decisions adopted by the company are
in accordance with the general policy guidelines and that the company is able to mobilize the
legal and tax resources that she needs to achieve her objectives.
It is therefore important to first check that not only does the company not relegate the
tax law as a constraint, but that the use of tax legislation and the exercise
fiscal choices are made in coordination with the other choices of the company.
The company’s tax policy must stem from and integrate with the general policy. There is
In the company, there is a priority that is extra fiscal and lies in the definition of objectives.
of the company.
The pursuit of tax efficiency is part of the coherent framework of the strategy of
the company. As Mr. Chadefaux pointed out, "law then becomes a technique
management auxiliary, a management science." It is indeed the relationship "taxation-
management » within the company, which is at the heart of controlling effectiveness in the
framework of a tax audit mission. The audit should allow for verifying that the use that is
Tax law helps achieve the company's objectives. This involves checking
first of all that taxation, like other branches of law, is used as a
means at the service of business management, and not as an end in itself. The audit must
thus questioning primarily the design of the tax function in order to ensure that the
preconditions for tax efficiency are met. As Mr. Mercadel indicates, 'the law must be
used by the company's management as a management factor on par with the
financing or marketing conditions.
Tax management is an important area of overall business management. Research
A tax economy is certainly a lever for investment. Nevertheless, it is necessary to
to dose the research of tax economy and integrate it into the search for efficiency
global.
Good management generally involves adopting a security and optimization strategy.
regarding the tax.
Nevertheless, it should be remembered that tax management is reduced to a simple search
of tax economy. The minimization of taxes is certainly an essential concern and
falls under good management, which is a duty of decision-makers. However, other concerns
economic and financial matters are also of interest and condition the strategy that
may be implemented by the company's leaders.
The company's tax management cannot be conceived in isolation. It would be
useless to claim to compete in tax optimization without integrating, in the reflection and decision-making
of decisions, the extra-fiscal repercussions of these choices. The tax management of the company
is an integral part of business management and cannot be dissociated. A strict approach
based on the search for the least imposed path, a legitimate and natural reaction, can
entrer en conflit avec d’autres types de considérations liées à la politique générale de
the company. The search for tax optimization cannot ignore the overall policy and the
company strategy. In this regard, the approach must have two characteristics
majors:

It must be comprehensive; "a comprehensive approach links tax solutions to the structure and
à la stratégie de l’entreprise : la question fiscale devient partie intégrante de la prise de
decision; the tax optimization of the tax is closely intertwined with the strategy,
the structure, culture, and skills of the company.
It must be multilateral in the sense that all stakeholders must be
taken into account, and based on the consideration of non-tax costs.
The evaluation of fiscal choices cannot forego a detailed study of
costs induced by the tax choice in other areas (legal, administrative), of the
coherence of the choice with the company's policy, its simplicity in terms of implementation
in operation and monitoring, its flexibility and the ability to restore the original situation and
finally its security, in terms of tax risk.

Thus, the company cannot afford to think in fiscal terms; it cannot reason.
qu’en termes d’incidence fiscale de décision de gestion. Ce qui peut paraître comme une
Evidence is actually a source of constraint for the tax audit. Indeed, the auditor is not in
measure to provide reliable assessment elements on the company's tax choices
that under the double condition of having a good knowledge of management sciences but
also a perfect understanding of the situation of the audited company. It is only at this
double condition that he will be able to provide a critical viewpoint on tax decisions
of the company, past or future.

c. The assessment of the company's ability to reconcile tax strategy and

business strategy
Le fait qu’une entreprise accorde une importance excessive aux aspects fiscaux dans la prise
of
the decision is essentially explained either by the absence of objectives and strategy for
the company, either through a slip-up of the initially defined strategy.
The absence of an explicit general policy thus deprives the company of the possibility of referring to it.
the management guidelines to define its fiscal policy and make its tax choices.
The company thus naturally comes to prioritize, from a tax perspective, research.
systematic approach to the path least imposed, the optimization of the tax parameter abstracted
management constraints.
Myron Scholes and Mark A. Wolfson explain that the implementation of a minimizing strategy
taxes can introduce significant costs in dimensions other than fiscal
such that a tax minimization strategy can be suboptimal. After all, a
A particularly effective way to avoid taxes is to avoid investing in
profitable activities.
Considerations other than strictly fiscal (cost, market, socio-political context,
the financial structure of the company,) means that an efficient tax strategy is often
different from that which consists only of minimizing taxes.
The absence of a strategy, which should normally emerge quickly from the phase of taking
general knowledge of the company, on the other hand, is an element that could bring into question
because the very principle of the tax audit mission, at least in its part dedicated to the
efficiency monitoring. In such a situation, the priority for the company lies in the
definition of a strategy, not in a thorough examination of the tax situation, at least
from the perspective of efficiency.
By wanting to reduce taxation through fiscal advantages (by means of the
financial tax relief), and in the absence of an explicit overall strategy, some companies
saw their resources dispersed, they allowed themselves to drift away from their core business and
of paying the training cost for new jobs at a sometimes higher cost than
the tax.
The awareness of the perverse effects of the use of benefits on allocation
resources contribute for businesses to develop a tax strategy that integrates with the
global business strategy.
The assessment of the company's tax performance, evaluating the adequacy of decisions
fiscal policy choices only makes sense if it allows for an appreciation of the
effective contribution of these tax decisions to the achievement of the company's objectives;
this is only conceivable if these have been defined beforehand. It is only at this
provided that the tax audit can take on its full meaning and contribute to optimization of
the fiscal management of the company.

III. Status of the tax auditor

Falling within the framework of the recognized tax missions of the accountant, as stated in Article 2.
of law n° 88-108 of August 18, 1988 amending the legislation relating to the profession
accounting expertise, tax audit as part of the missions that can be provided
the accountant adheres to a regulatory, ethical, contractual framework and
behavioral (1). The inventory of the required qualities of the auditor (2) must therefore facilitate
the identification of the profession or professions best equipped to carry out such a mission
nature.

1. Regulatory, ethical, contractual, and behavioral framework of

the chartered accountant in the tax audit mission:
The tax audit mission carried out by an accountant adheres to a regulatory framework.
precise. This mission is also set within a contractual framework marked by the requirement
professional establishment of a mission letter. The intervention of the expert accountant
In a tax audit mission, a strict ethical framework is involved. However, the
failure of the accountant to meet his legal or contractual obligations may expose
to the criminal penalties, in addition to other actions that may be taken against him or her and
notably the claim for compensation for damages suffered on a civil level as well as some
sanctions disciplinaires.

Regulatory framework
Contractual framework
Ethical framework
Responsibility of the accountant

The tax auditor

The title of auditor is synonymous with requirements and brings with it elements of
response regarding the requirements imposed on the auditor. Firstly, the auditor must not
nor be judge and party, meaning that they should not be responsible for the content of the information
audited, in other words, that it should be independent. Secondly, the auditor must be in
measures to make a judgment on the quality of the information it audits, which means that it
works in a field that is not only familiar to him but that he masters. The listener must
thus achieve a high level of competence in order to be able to assess the quality of
the information it audits. Independence and competence are thus the qualities expected
of an auditor in general, and therefore of a tax auditor in particular.

a. Independence
The auditor is led to formulate an opinion on information in relation to criteria of
regularity and efficiency; that is why it is important that he demonstrates impartiality in his
judgment. For that, he cannot afford to give an opinion on information of which he is,
in whole or in part, directly or indirectly a producer. This independence should
to appreciate oneself both materially and morally.

b. The competence
This criterion is of great importance for the tax audit, as it will condition the
development of this type of mission.
Indeed, the success of the tax audit for companies will primarily depend on a
minimum level of quality that only the skill of the stakeholders in this field
could guarantee. In terms of tax audit, this requirement arises with great urgency
since the tax auditor must master not only taxation but also the
audit techniques, which presupposes that he masters accounting, computer science,
financial and legal and, in general, everything related to management of
companies.
As a result, the tax auditor must have a high level of competence requiring both
a profile of a specialist and also that of a versatile generalist.
CHAPTER 2: APPROACH AND THE
ELEMENTS OF TAX AUDIT
Section1 : la démarche de l’audit fiscal

The control of tax compliance within the framework of the tax audit has common points
with certain aspects of financial auditing. The interdependence between taxation and accounting
is necessarily found at the level of control. The financial auditor who must pronounce
sur la régularité des états financiers ne peut négliger l'aspect fiscal, même s'il poursuit des
broader objectives; conversely, the tax auditor relies on accounting to conduct its
work.

I. General understanding of the entity and definition of the tax framework

the audited company

The phase of general familiarization constitutes the main and initial aspect of this
approach. It is considered a necessary phase common to all missions
of an audit. Indeed, the course of a tax audit mission largely borrows from the
approach followed in the financial audit. Thus, the first step of this mission consists of
a phase of general acquaintance with the company similar to that which one
encounter in financial audit missions. Gaining knowledge of the industry sector and
his regulatory environment allows the auditor to determine the tax regime
applicable to the company and the tax and financial advantages to which it is eligible.

General knowledge of the entity

According to the ISA 315 standard, the auditor must gain an understanding of the entity and its
environnement, y compris de son contrôle interne qui soit suffisante pour lui permettre
to identify and assess the risk and to design and implement audit procedures
complémentaires. Acquérir la connaissance de l’entité et son environnement est un aspect
essential to conducting an audit. In particular, this knowledge provides the foundations on
lesquelles s’appuie l’auditeur pour planifier l’audit et exercer son jugement professionnel
notably to assess the risk. This preliminary step allows the auditor to soak in
the tax specifics of the company and to obtain valuable information in this way about
the future direction of its work. According to ISA 315, obtaining knowledge of
l’entité et de son environnement, y compris de son contrôle interne, est un processus continu
and cumulative collection, updating, and analysis of all information at
different stages of the mission. The auditor's knowledge of the company and its
The environment involves understanding the industry sector and its
legal and tax environment.

a. Understanding of the industry:

It is a sector of activity in which the company operates that can generate specific risks.
designated by Jean-Luc Rossignol as "inherent risks" resulting from the nature of the activities or
of the organization and structure of certain sectors dominated by the informal.

b. Understanding and appreciation of the legal and tax environment:

According to paragraph 22 of ISA 315, "the auditor must gain an understanding of the sector.
of the activity concerned, the regulatory environment..." In accordance with ISA 250 (Taking
taking into account legislative and regulatory texts in the audit of financial statements), "For
plan the audit, the auditor must acquire a general understanding of the legal framework and
regulatory framework in which the entity and its sector of activity are situated, and determine in which
measure she complies with it.
The auditor must plan and conduct their audit with a mindset of professional skepticism.
This implies that the auditor must recognize whether there may be circumstances that favor the
non-compliance by the entity with legislative and regulatory texts. This phase of taking
general knowledge leads to the establishment of several files that define
gathered on the company in various areas. The development of these different files
create the permanent file that could be useful to the auditor in his future investigations.

2. Definition of the company's fiscal framework

Before defining the tax regime of the audited company, the tax auditor must ensure that
the existence or non-existence of a permanent tax file. Indeed, in the absence of a file
fiscal permanent, the accountant will have to recommend at the level of his improvement plan
the establishment of a permanent file. The permanent tax file contains the elements for
general character related to the tax regime such as:

The declaration of existence.

The investment declaration.
The supporting documents for the completion of permanent tax formalities
(printer's declaration, software deposit, etc.).
A copy of the tax laws in order to justify particularly choices made or of
benefit from particular tax regimes.
Les consultations écrites établies par les conseillers de l’entreprise.
The common notes and positions issued by the tax administration following
to questions related to issues concerning the company's tax regime.
The copies of court judgments or studies and articles used as the basis for
tax choices.
After reviewing and consulting the permanent tax file, the tax auditor is required to
define the tax regime of the audited company (in the absence of a tax manual) before
implement the validation procedures. This tax framework varies according to various criteria including
notably, and in order of importance:

The sector of activity of the company.

Le marché de l’entreprise (local ou étranger) et la typologie de la clientèle (Etat,
public organizations and companies, beneficiaries of the benefits scheme
fiscal such as totally exporting companies, large enterprises or
final consumers).
The tax benefits granted to the sector in which the company operates.
The tax benefits granted to the company due to its establishment
geographical (economic activity parks, regional development areas, etc.).
The willingness of social leaders to integrate tax management into the system
d’information pour la prise de décision.
The legal form of the company.
The definition of the tax regime allows for the clarification of the tax obligations to which the company is subject.
is subject to and the tax optimization policy exercised through the evaluation of choices
company's tax matters.
 a. Les obligations fiscales :

The definition of tax obligations consists of specifying:

The taxes and duties owed by the company, specifying the modalities of their
liquidation (base, rate, triggering event, exemptions, suspensions, etc.) as well as the
terms of their declaration (frequency, forms to use, documents to attach,
documents to keep to justify and explain the declared amounts, etc.).
The substantive or formal obligations placed on the company under the
dispositions fiscales en vigueur.

b. Tax management:
The tax framework of the audited company must be established in such a way that the company
support the minimum tax legally. This is not an attempt at fraud or
of tax evasion but of a sound management of the company also referred to as fiscal skill.
Indeed, it is legitimate for any company to save within the limits of the law its
interests. At this level, the mission of the tax auditor requires both a perfect
knowledge of regulations and tax doctrine and an ability to manage the
different alternatives offered to the company in order to benefit from the opportunities and
potential advantages. As a precaution, controversial questions and those not resolved by taking positions
the position (commonly shared notes or positions) will be subject to consultations to be addressed to
the DGELF or the General Directorate of Taxes.
For exceptional facts and operations, tax risk is not managed by the procedures.
internal control currents but by implementing specific procedures. The expert-
The accountant must therefore understand and analyze these operations. He is therefore looking to see if the entity
carry out or plan to carry out such operations, and it is through the consultation of the
internal company documentation such as the minutes of the general meetings and
management reports. It studies the applicable tax regime for these operations. The expert-
accountant carries out the reconciliation of the tax complexity of these transactions at the level of
competence of the people dealing with these issues in order to examine whether there is not any
marked disproportion, and consequently a risk of poor management of the problem. In
in this case, the risk is indeed double, as it involves both a risk of inefficiency
fiscal but also of irregularity. The attention of the accountant is focused on certain
points, not by the importance of the obligations incumbent on the company but by the fact that
certain operations are particularly scrutinized during a tax audit and
are therefore important risk factors, even if their treatment does not raise any
major difficulties.

II. Examination of the Internal Control system and the information system:
The internal 'fiscal' control is intended to provide 'reasonable assurance' regarding the
realization and optimization of operations, the reliability of financial information and the
compliance with current laws and regulations. The establishment of an internal control
effective fiscal leads to considering it both as a means of verification but also
as a means of controlling the activity. Internal control is part of the approach by the
risks and must integrate the way in which the activity is structured and the risks associated with it,
evaluate them in relation to the strategy and then arbitrate them to better control them. The approach
The international COSO framework goes far beyond accounting and financial reporting.
It allows us to consider internal control not only as a framework of procedures
but also as a tool for the performance of the company. Since 1992, the COSO constitutes the
International framework for internal control; it provides the following definition: "the control
internal is a process implemented by the board of directors, the executives and the
personnel of an organization, intended to provide reasonable assurance regarding the achievement
of objectives falling into the following categories:
Execution and optimization of operations.
Reliability of financial information.
Compliance with applicable laws and regulations.

COSO published a new conceptual framework on management in September 2004.

risks. The underlying idea of this new approach is to consider a close link between
the objectives that the company has previously set from a strategic point of view,
profitability, communication, and compliance with laws and regulations, and the risks associated with them
attached due to the sector of activity or the organization. These risks must be put in
relationship with those that the entity is willing to accept and that lead it to the implementation of
procedures. Risks and procedures are then studied for each process and are the subject
of ongoing monitoring. This new approach to risk places management and the system of
flow of information at the very heart of the internal control system put in place.
Before proceeding with the evaluation of internal control and the tax information system, there is
instead of defining these two concepts. Then, the accountant proceeds to evaluate the system
of tax internal control.

1. Definition of internal control and the tax information system:

The definition of a fiscal internal control system allows for better management and control.
tax risk. The tax information system appears as an essential component of
internal tax control system.

2. Definition of tax internal control:

Mastering tax regularity is an essential prerequisite for any willingness.
tax optimization. Its prevention requires constant vigilance, as any
the operation of the company has a tax impact. Such work falls under the competence of
the fiscal function of the company. This prevention requires a comprehensive assessment of
fiscal process in order to optimize the fiscal management of the organization. The organization must
regularly review your tax process to adapt to a regulatory environment
constantly evolving and therefore its operational methods. A regular tax audit for
assess the relevance of the company's fiscal choices based on its situation and
its structure finds all its interest in evaluating its tax performance, just as it is
possible to assess its financial performance. In this context, the tax audit mission has
précisément pour objectif d'examiner la situation fiscale de l'entreprise, en s'intéressant à la
how the company approaches taxation, its way of integrating the parameter
fiscal in its decisions and choices whether they are tactical or strategic and
naturally his level of tax risk. The tax auditor will first ensure of
compliance with tax obligations, through a regularity control of which the
results will highlight any errors made as well as the
risks they generate. In a second step, it will be necessary to assess the ability of
the company to manage as best as possible its interests the possibilities allowed by tax rules that
they themselves create a real margin of maneuver that can optimize the situation
fiscal. The gathering of information on the nature and extent of the risk incurred allows for this
dual examination of regularity and efficiency, to establish a fiscal health assessment, a diagnosis
fiscal, element of general diagnosis of the organization. The approach can present two
objectifs : l'un offensif pour éviter une surimposition, l'autre défensif pour détecter et anticiper
les risques fiscaux, surtout s'ils découlent de dispositifs hasardeux ou tout au moins
audacious. The chosen approach ultimately leads to the establishment of a chain of
tax internal control. This chain includes specific internal control procedures
established from a mapping of tax risk that has become useful not only at the level of
the tax direction of the entity but also of its governing bodies (board of directors)
and audit and risk committees). The establishment of such a mapping is in itself a
véritable instrument de pilotage fiscal pour l’entreprise qui s'en doute. Globalement, le
internal tax control allows for:
Ensure compliance with current tax laws and regulations (mastery of the
tax technique.
Produce quality tax information in relation to the tax administration.
Ensure effective tax management of the company through the implementation of indicators
of fiscal performance (fiscal dashboard and TEI.
Ensure the reliability, efficiency, and traceability of operations and documentation.
in order to certify the reliability of the tax figures: calculation of the tax, of the provisions for
tax, monitoring of intragroup flows according to intergroup pricing policies
(adaptation of the accounting organization to tax needs).
Secure the computer tool with rigorous control of the information system
fiscal while advocating for an infrastructure that facilitates the spread of knowledge
fiscal authorities within the organization itself. The IT tool must therefore be able to
to capture developments and monitor the selected tax methods.

In this context, tax internal control provides real added value, to the extent that
where, by integrating risk anticipation, it is not limited to avoidance
malfunctions. The tax information system appears as an essential component
of the fiscal internal control system. It allows for more effective control of the process.
fiscal, to implement the tools for formatting and interpreting the
data and to ensure an adequate reporting of the control results.

3. Definition of the tax information system

The existence of a tax information system conditions the quality of performance.
fiscal. According to the reference definition by Davis and Olson (1985), an information system
is a set of elements (humans, materials, software) allowing to create, to process and to
communicate information; he assists men, within an organization, in
execution, management, and decision-making functions. It therefore includes
technical and organizational measures to capture, store, process and
transmitting information. To identify it, it is possible to retain the representation
systemic with the operations system, the decision system, and the information system
which acts as an interface between the two previous ones with a threefold purpose: assistance to
operations, decision support, and communication support. The system provides the information
useful for their piloting mission and, finally, ensures parity in the exchange of information
the inside of the company and between the company and its environment. According to Mr. Chadefaux and
J.L. Rossignol, the tax information system is situated in this perspective at the heart of
four concerns: compliance with tax regulations, the functioning of the organization
internal taxation within the entity or the group, computer science and naturally human activity
related to the creation and use of tax information. The tax information system
constitutes a component of the company's global information system with which it must
to communicate, just as fiscal policy is a component of general policy
of the company that it feeds and influences. It contains both a tax monitoring system,
a preventive alert system as well as a tax reporting system likely to put in place
highlight any potential failures. The implementation of blank tax controls can
reveal the need to update the documentation of the internal tax control process on the
basis of the study of the relevance, appropriateness, and efficiency of the decisions made and thus
optimize the use of the resources implemented. This setup allows in particular to
check the organization's ability to restore its data and present it to the administration
tax, if necessary, documents with probative force.
necessary formalization to secure the company's memory regarding its files
Tax authorities constitute a useful tool for better analysis of the process and for attesting.
as a result of the interest in the establishment of warning and surveillance systems related to the
mapping of identified risks. The need to provide more financial communication
efficiency associated with the generalization of integrated management software strengthens the interest in a
true fiscal governance for better efficiency and compels companies to submit
to streamline their tax information system in order to have consistent and reliable information
on their tax situation, and particularly the tax frictions that could be reduced or
even avoided. It effectively gives the fiscal function a central role, just like the
financiers. It is actually appropriate to precisely analyze the tax process within
the organization by associating all external as well as internal stakeholders of the system.
The more systematic association of the fiscal function with the decisions of the general management
makes it easier to appreciate its scope but also the associated costs and fiscal risks.
present and future. The need for greater external communication also leads to
influence more effectively the process of creating or modifying tax standards,
by seeking to develop a more partnership-based relationship with the tax administration, which
simultaneously displays a willingness for dialogue and transparency. The analysis of the process
fiscal is conditioned but also actually conditions the quality of the fiscal information of
the organization. The dissemination of quality tax information depends on both the objectives
that the entity gives and its fiscal ethics in its rendering to the administration. It depends
of course also depends on the quality of the tax standard. The quality and understanding of
Tax information is assessed based on its reliability, its verifiability, its
compliance with the rules, its comparability, and generally its clarity. The guarantee of this
quality and this understanding therefore implies respect for tax rules
naturally, but also an organization that meets the control requirements and
verification as well as the implementation of tax reporting procedures for better
tax and general decision-making (steering and regulation actions).

4. Evaluation of internal control and the tax information system:

The next step in the accountant's approach should allow him to assess
the effectiveness of the internal control system and the information and communication system
of the company. The accountant must study and examine the procedures to detect the
tax deficiencies that they contain and propose additional instructions for
take into account the tax parameter. This examination of the general processes can be done by the
consultation of certain company documents, such as the quality procedures manual or
the manual of administrative and commercial procedures. The accountant can also
use other techniques such as interviews with management members and the
personnel and the internal control assessment questionnaires. This review concerns all
business processes, particularly those in which participants manage issues
fiscal, such as procurement processes, the business process, cash management,
etc. Thus, the accountant observes, for example, that the selection of the supplier is based on
account of the tax and customs regime for items or services to be ordered. The management
procurement therefore transmits the request to the finance department for analysis of the
tax and customs regime of the product (purchase in suspension or exempt from duties and
taxes, privileged tax regime, etc.). When consulting suppliers, requests for
Prices for subcontracting services include specific requirements regarding
tax situation of the subcontractor, it being specified that the fiscally transparent company chooses
suitable partners for its requirements. When placing orders, for business
benefiting from special tax privileges (exemption from VAT, customs duties,
etc.), the purchasing manager implements all necessary steps
in order to realize the tax advantage as quickly as possible. To this end, he is accompanied
the purchase order submitted to the technical management along with all the required documents for
the establishment of technical privilege files (pro forma invoice, etc.). The verification
Invoices and credits, during their recording, require the verification of their regularity.
fiscal invoices. In addition to the general procedures for internal control, the accountant
must appreciate the specific internal control procedures in the tax area. "In terms of
fiscal, internal control is defined as the control over the processes leading to the
formation of fiscal impacts in the accounts.
The accountant should also ensure the existence of an efficient information system.
by the establishment or not of alert and surveillance means. Thus, the existence of a software
of integrated management allowing to reconstruct the company's sales for a period from
The results of the physical inventory and accounting data serve as a warning signal.
effective. Thus, and for each stock item, the company's information system must
allow to return the following equation: Initial stock (stock at the beginning of the period) +
Purchases for the period - Losses and other justified outputs - final stock (inventoried stock) =
Sales for the period The discrepancies attributable notably to losses, rejections, donations, deteriorations,
damages must be explained by supporting evidence (example: notary’s report,
etc.) To this end, the accountant must pay particular attention to the method of processing
reserved for tax issues within the company. These investigations lead him to
highlighting flaws that generate tax risk. It focuses its examination on the
specific methods for addressing tax issues. It can evaluate, in particular:

The tax function.

The evaluation of tax procedures.
The adaptation of the accounting organization to tax needs.
La documentation.
Archiving.
Tax monitoring.
The level of maturity of the company's tax management system.

a. The fiscal function:

The auditor's investigations may thus focus on the material and human resources of which
The company is set to address tax issues. The auditor will question about
the existence of a tax service and if applicable its organization and position in
the company's organizational chart. Failing that, the auditor must determine the individuals who make
in charge of tax issues and assess their level of qualification. He can, in
complement, enumerate the methods that allow these individuals to maintain and improve
their knowledge: nature of the documentation used, training internships, etc.

Whether it is represented in large companies by tax directors or in the

Managed by the financial directors, the tax function must fulfill the following two objectives:
Mastering tax risks by implementing, for example, procedures for
prevention of tax risks.
Mastering the overall tax burden through the implementation of a tax dashboard
and by the determination of the TEI.

b. The assessment of tax procedures

It is established that the fiscal and accounting function of the company actively manages 25% of the
tax risk. The remaining 75% is managed in other operational services and
company officials; the tax and accounting functions only manage them afterwards and
are exposed to the risk of being acted upon by the responsible services. The tax fact is not
but then it becomes the issue of all tax technicians
stakeholders. Consequently, operational procedures should integrate the
tax imperatives. Thus, the sales procedures will systematically incorporate the
regulation regarding value-added tax (rates, base, etc.). The tax concern
must not be limited to ensuring proper application of tax law by minimizing the
material errors. It must also ensure perfect traceability of operations
regarding the company and likely to have a tax impact. Moreover, the importance of
the activities of a company, the sensitivity or complexity of its tax file may
involve the establishment of a specific organization of tasks related to
the establishment and submission of tax declarations by imposing specific procedures
adapted to the specifics of the company. The tax auditor must ensure that the procedures of
verification and control used by the company allow for presentation in a timely manner
time for accurate, complete, and clear statements. Beyond tax statements,
the accountant can thus effectively ensure that the procedures implemented
establishing a rigorous organization aimed at obtaining sufficient assurance that the
tax obligations of form should always be respected.

c. The adaptation of the accounting organization to tax needs:

Accounting, as a tool for centralization, synthesis, and tax base, constitutes the
main basis of tax control and, consequently, of discovering tax failures.
Accounting also embodies the tax choices made by management, such as tax reliefs.
physical or financial, the methods of depreciation, etc. Effective procedures for seizure and
of imputation, analysis and accounting justifications and accounting reconciliations
taxation is likely to reduce accounting-related tax risks. The prevention of
Tax risk implies a systematic reconciliation of accounting with the databases.
declared. This reconciliation concerns:

The revenue declared for VAT alongside the recorded revenue.

 The declared salary base for withholding tax on wages, of the TFP and of
FOPROLOS, at the level of quarterly declarations of the CNSS and the declaration
from the employer with the gross salaries recorded in the accounting.
The withholding taxes reported in the monthly declarations with the
withholdings at source included at the level of the employer's declaration.
To ensure effective reconciliation, the preparation of tax returns must rely on
on accounting. Furthermore, the adaptation of the company's accounting plan to the needs
tax measures can provide an appropriate response to certain tax audits. In this regard, the
creation of certain sub-accounts for expenses or revenues intended to house the
operations that impact the determination of taxable income allow for acceleration
the inventory of adjustments to be made at the level of the determination table of
tax result.
Du fait que le souci majeur de nombreuses petites et moyennes entreprises est de réussir tout
tax audit, the tax auditor could propose to the company the implementation of a plan
tax-oriented accountant. Before implementing the validation procedures (tests of
compliance and opportunity), the tax auditor must ensure the relevance of the procedures
that is to say of their reassuring character to produce reliable information. As for
regarding the establishment of tax declarations, the tax auditor considers that the
procedures provide security when statements are established from the data
recorded in accounting, as the audit trail can be easily identified and the
data verification can be better controlled. However, the establishment of declarations
Fiscal policies that are implemented in an off-the-books manner always sow doubt about completeness and reliability.
declared data and is often the source of discrepancies that need to be justified (and sometimes do not
cannot be). The examination of the adaptation of the accounting organization to fiscal needs
allows the tax auditor to:

Know whether tax declarations are established from accounting data (this
assuming that the accounting is constantly up to date) or off-balance sheet (and that
suppose a posteriori confrontation of the declared data with the data
accounted for).
Identify the sources of data to be audited (accounting or non-accounting data)
or both at the same time, depending on the specificities of the society and the taxes to
auditor).
Detect anomalies or deficiencies in the establishment procedures.
tax declarations and obviously to issue recommendations
of improving these procedures.

d. The documentation:
Whether it is a specific social or tax declaration, or more generally the accounts
annually, a company must be able to locate a document and justify it
content. This exercise that is prepared daily must be able to be carried out over periods
unprescribed pasts. The documentation thus appears as an exercise in anticipation.
who prepares daily and without waiting for a possible inspection.
The description of the work carried out and the accessibility of the document that originated the information
aim to anticipate the questions that a person outside the context, a controller
fiscal for example, would arise within the framework of a given intervention. For illustration,
given the gap between the preparation of a declaration or the accounting
of an operation and its eventual control, and therefore the risks of forgetting, the establishment of
annual tax files summarizing primarily the tax returns filed and the
pieces and documents having a tax impact allows for quickly finding all of the
elements concerning a tax issue. In the absence of documentation procedures and
In terms of archiving, the tax auditor should report these weaknesses and recommend them at the level of
his improvement plan. The creation of such a file is often useful because, in practice,
it proves to be very difficult to provide all the necessary details that will be requested during
of a tax audit and to justify certain specific or exceptional operations
several years after their completion. The purpose of the tax working file is to gather
all the information related to a specific accounting or tax issue. Depending on the size
and the company's activity, the volumes processed, the complexity of the operations, the content of a
the file will be very variable and more or less detailed. The approach when compiling a
The working file often comes from an analytical approach where every aspect of a problem
is detailed and broken down into sub-problems addressed successively.
In the absence of this documentation, the accountant should recommend the establishment
from this documentation since it allows:
To respond quickly, precisely, and accurately to the auditor's questions;
To give him a positive image of the precision and rigor of management
taxpayer accountant.

e. Archiving
The ability to respond correctly and promptly during a tax audit depends on
part of the quality and speed of information and documentation retrieval
archived. It is therefore essential that the archiving is carried out rigorously. Although
companies remain very free regarding the archiving methods due to the fact that regulation
focusing more on the requirements for return than on the archiving methodology,
the accountant should recommend a high level of rigor in the archiving process and
in the formalization of the work (clear and precise inscriptions on the archived boxes, list
archived boxes communicated to a manager). The tax auditor should also ensure
what specific precautions must be taken regarding computer archiving in order to
to be able to meet the administration's requirements for control (presentation
data, documentation), but also on a material level (preservation of
saved in fireproof cabinets, preservation of software allowing for a review).
Documents can only be kept in their original form, which excludes keeping them...
archiving on microfilms or magnetic tapes. As for the deadlines, the regulations
limit itself to providing a retention period of ten years for documents and items
Accountants. A longer retention period is required when depreciation
deferred tax credits during loss periods or tax credits date back more than ten years.
The tax auditor may recommend, for this purpose, the establishment of a computer database of
tax data (BIDF) containing a summary of the taxes and duties that have been declared during
at least the last ten exercises.
f. Tax vigilance (stay awake):
Tax matter is in perpetual motion. Those responsible for taxation must
continuously update their knowledge and benefit from tax monitoring systems
allowing for the rapid and timely tracking of the evolution of legislation,
regulation, doctrine and administrative practices and to inform all of them
people involved in the company's tax management. This tracking is a factor
determining in prevention and tax optimization. For example, a change
of a rate not applied on time or a reversal of the administrative doctrine not taken into account
accounts can have detrimental consequences. The tax auditor must ensure that
The tax monitoring activity encompasses all coordinated actions of research,
collection of texts that govern the company's activities, analysis and dissemination of
the information useful to the various units of the company. Indeed, because of the taxation
Tunisian taxation is a practical essence, the tax auditor must ensure that the company
collect, in addition to legal texts, the administrative doctrine, namely the common notes and the
positions taken. The collected regulatory texts must be classified by date, theme and
by source of law and archived in a manner that allows for quick accessibility. In the absence of
collection, the tax auditor must ensure that the company has access to this documentation. Thus
a good tax monitoring seems essential for the establishment of an effective system of
management of tax risks.

g. The maturity level of the company's tax management system:

After assessing the tax characteristics in the first phase of its intervention
the company, the auditor is led to highlight the level of maturity of management
tax risk of the company. The level of maturity thus determined conditions the nature,
calendar and the scope of additional audit procedures.
Based on the various observations made, it will then be up to him to determine
the direction he must give to the continuation of his work, particularly within the framework of the controls
of proper regularity. Indeed, the maturity scale of tax risk management is
composed of six levels:
Level 0, non-existent management: the company is not even aware that there is a
tax risk to manage, positive or negative.
Level 1, initialized management: the company is aware that there is a tax risk
(positive or negative) that she manages in a reactive and improvised manner according to the individuals.
Level 2, non-formalized management: the management process is designed and transferable.
but remains unofficial. Although the people involved with taxation use
procedures that contribute to tax risk management, there is no training
organized, nor written procedures (risk management manual). The responsibility
is left to the individual whose behavior may escape correction by the
system.
Level 3, standardized process: risk management procedures are defined,
documented and communicated through a structured training. However, few
control allows to observe and correct deviations. The system remains standard and
innovate little.
Level 4, managed process: it is possible to observe and measure compliance
practices to the designed and formalized system and to act when processes do not
do not work properly. Processes are continuously improving in
drawing on best practices. The system effectively develops
self-assessments and aims for optimization.
Level 5, optimized process: the processes have reached the level of the best.
practices following a constant improvement dynamic. The optimization and the
tax planning is global and operates in strict compliance with the criteria of
compliance. The system is governed by a logic of continuous improvement,
development and use of high and ethical skills.
Section II: the elements of the tax audit
The tax audit aims at two complementary objectives:

The compliance audit that ensures the company's adherence

the applicable tax regulations. It also highlights the main
causes of failure of the company in terms of tax compliance and to adopt, in
As a consequence, the measures aimed at addressing the deficiencies noted at the level of
procedures, or also regarding the organization and functioning of the tax service. In
thus, the tax audit ensures a mission of detection and prevention; it operates in that direction
a greater fiscal security of the company and contributes to the improvement of the level of
maturity of tax management.

The opportunity audit that ensures that tax management is optimized in

notably checking that the audited company has been able to take advantage of all opportunities and
all the benefits offered by tax legislation. The role of the accountant in the
The purpose of the tax audit mission is precisely to highlight the deficiencies that result from a
passive behavior or reporting errors related to prior choices made in
knowledge of the cause. The tax efficiency audit should thus raise awareness
the company emphasizes the gap between potential tax efficiency and
the tax efficiency achieved.
In this way, the company must adopt measures that will enable it to strive
towards optimizing its tax choices, gradually improving its tax efficiency.

I. Compliance audit:
By compliance audit, we mean:

The examination of the society's compliance with all its formal tax obligations

Since accounting is the main basis for tax control and, by

consequently, in discovering tax failures, the most rational approach seems to be
the one that involves carrying out accounting checks for tax purposes
This accounting verification guide for fiscal purposes allows for a presentation in a manner
synthetic main themes on which the listener should focus on the subject
corporate tax
Sometimes, VAT is not addressed in our report as the analysis of
Risks in this area require a very detailed examination of the flows and invoices that cannot
to be carried out only as part of a specific VAT audit mission.

1. The audit of compliance with formal obligations:

In many cases, adjustments are made due to non-compliance with the rules of
form without there being a deficiency in terms of the base.
The sanctions for failures to comply with formal rules, which appear in the eyes
of those who support them as always being inequitable, can yet be
financially heavy.
The auditor must necessarily conduct an examination of the risks related to the form and deadlines.
Considering the importance of these issues in the tax field.

a. The control of the rules relating to form

Clearly, in a declarative tax system, issues related to form take up a
important place. In fact, the tax auditor may need to, depending on the objectives of the mission,
perform a significant number of checks. The auditor will also make sure that for example
the company does indeed submit the various required declarations and that it uses for
this the appropriate printed materials and statements. On the declarations themselves, the auditor must
naturally check that they are properly filled out and do not have
arithmetic inconsistencies.
Similarly, it is necessary to seek correlations with accounting information.
and more generally, to study whether the company is able to justify afterwards the
sums or indications stated on the filed declarations.
For this, the auditor can check if the company uses transition tables or tables.
of conformity between the different accounting books or documents and the tax returns
and, if so, verify the relevance of these documents. The auditor can also
to question the existence and, if applicable, the frequency of corrective statements
addressed to the administration. Indeed, even if they are supposed to reduce the risk
fiscal by correcting previously made errors, they can supply it by giving
to the tax services a feeling of approximation and uncertainty in the processing of
tax-related questions within the company 217.
The auditor must finally ascertain that the various documents are addressed to the tax authorities.
competent and, of course, within the prescribed deadlines.
Following the assessment of internal control and the tax information system which determine whether
the control mechanisms (studied in the first chapter) are indeed effective and
applied correctly, the auditor plans restricted control tests account
given that the risk related to control is low.

b. The control of rules relating to deadlines:

The controls related to deadlines occupy an important place in the work of

the auditor insofar as the penalties due for failure or delay in the production of
Declarations and tax payments can be financially burdensome.
The most appropriate tool for the company is the establishment of a tax schedule, document
on which the company records all its obligations in terms of taxation, whether they are related to
dates for submitting tax returns or dates for payment of various taxes and duties.
The auditor's job here is to first verify the existence of this tax schedule.
puis sa qualité et enfin son utilisation effective par l'entreprise. L'auditeur peut ainsi s'assurer
that this schedule is both complete, updated and that it is being disseminated to
all the people involved. Accordingly, the auditor can ensure the absence
of late penalties in accounting for late submission of declarations, and in
the contrary hypothesis, to get its origin explained: poor coordination between services,
negligences, difficulties in submitting the declarations on time.
Finally, and always depending on the objectives of the mission, the auditor may have to, after having
ensured the content of tax declarations, proceed with a reconciliation of the different
monthly declarations and the employer's statement in order to verify their
homogeneity.
In terms of implementation, the controls that must be carried out by the auditor are divided.
in two categories, depending on the control tool to be used. Compliance with a number
Important tax provisions can indeed be verified using the traditional tool of
the audit which is the questionnaire. However, it does not adapt to the control of all the
tax rules, the auditor is required to resort to various complementary checks to
to successfully complete its mission.

c. Controls based on the use of the tax audit questionnaire.

The control of tax compliance relies largely on the results of the operation of the
tax audit questionnaire. An essential step in the auditor's process, the questionnaire
must inform about the company's ability to comply with substantive provisions but also
in terms of form and deadline to which it is subject. To achieve such an objective, it is important
however, the design of the questionnaire should be as rational as possible in order to
allow the listener to review the various risk factors taking into account the
constraints of the mission, whether regarding the modalities of accessing information or
time limitation of the auditor's intervention.

The objectives of control by questionnaire.

The structure of the tax audit questionnaire.

2. Accounting verifications for tax purposes:

The accounting checks with a tax purpose aim to validate the charge of
the tax of the audited entity as well as the identification and quantification of tax risks
to which this entity may be exposed due to non-compliance with tax regulations.
Although the annual audit work is of a nature
essentially accounting, tax being just one element in the determination of the result
accounting for the period, or a liability whose amount must be validated, the complexity
tax rules lead companies considering a transparency policy to do
appeal to an accountant to conduct an assessment of tax practices of
the entity and to establish a diagnosis of the tax risks that may be incurred.
The accounting verification works for tax purposes concern the balance sheet accounts and
class-by-class management.

a. Permanent capital

In order to be able to carry out the most accurate examination possible of the financing structure of
the audited entity, the auditor must analyze a certain number of documents.
Thus, the main documents to analyze are as follows:

The financial statements, particularly the statement of changes in equity

The general balance of the accounts for each audited financial year.
The minutes of the general meetings held during the period
audited.
The general report and the special report of the auditor for each
audited exercise.
The general report and the special report of the auditor for each
audited exercise.
The loan contracts from the audited period.

From a tax perspective, equity should draw the auditor's attention to the points
following essentials:
 Ensure that the company is incorporated in accordance with the provisions of the CSC.
Indeed, a limited liability company (SARL) formed contrary to the provisions of the CSC is considered,
according to administrative doctrine, a de facto company;
Ensure that the tax rules for accounting for grant share allocations are followed.
equipment defined by Article 11-IV of the Income Tax and Corporate Tax Code have been
respected.

b. Intangible assets:

There is no tax definition of intangible assets. The accounting rules, which

constitute the only reference in the matter, define them as non-monetary assets
without physical substance intended to sustainably serve the activity of the company.
The main difficulty regarding the identification of intangible assets lies in the fact that they do not
are not all immobilized. However, the analysis of tax risks requires consideration of
all these assets, whether or not valued on the balance sheet.
The main documents to analyze are:

The monthly statements

A detailed statement of depreciation attached to the annual corporate tax return.
The table for determining the taxable result.
The general balance.
The details of certain accounts if necessary.
The financial statements.
The annexes to the financial statements.

Intangible assets are mentioned in the balance sheet. The balance sheet must align with the
table of fixed assets and depreciation attached to the annual corporate tax declaration.
These elements are not sufficiently detailed to allow for the exhaustive identification of
intangible assets held by the company. Additional information
are therefore necessary. They can be found in the general account balance, which allows
to identify the assets at least by major category (trademarks, patents, software…). For more
In detail, it is necessary to delve into the content of each account, which implies formulating some
specific requests for the attention of the company's accounting department.
The auditor must verify that the amortizable intangible assets are subject to
depreciation.
The general balance of accounts allows for reconciling the variations of the accounts.
depreciations and provisions from the balance sheet with the allocations of the fiscal year (account 68111
for the amortizations, 68161 for the provisions).
The income statement also helps to identify the movements that have affected the accounts.
631 for expenses and 731 for income, revealing royalty flows. The auditor must
imperatively request the copy of all contracts justifying these flows.
The notes to the financial statements may contain useful information regarding the principles
retentions concerning depreciation and provisions.
By exploiting these documents and the answers to any additional questions he may ask,
the auditor has relatively comprehensive information on the fixed assets
intangible assets on the balance sheet, those that are amortized, those that are subject to amortization
derogatory and those that have been provisioned.
To stop an audit process, it is necessary to keep in mind the main issues.
taxes on the holding of intangible assets. Given that this is a complex subject, a method
A more in-depth audit is offered on a case-by-case basis.
In the context of an audit of intangible assets, the auditor must, to the extent possible,
adopt the following approach:

Identify as precisely as possible all the intangible rights used by

the company and determine under what title it holds it, whether in
quality of owner or of simple user as may be the case with a
license agreement. As part of this initial step, each flow affecting the
intangible elements must be identified as part of detailed investigations
performed from accounts 631 and 731 and their subdivisions.
Determine if the expenses that contributed to the acquisition of these intangible rights
constitute charges or fixed assets (Identification and Evaluation of the risk
related to non-compliance with the asset registration rules: appendix 2).
When the rights used constitute fixed assets, check that the conditions
the depreciation assessments have been respected (Identification and Evaluation of
risks related to non-compliance with depreciation and provisions rules: Appendix 2).
Other issues that have not been mentioned in this chapter arise.
also: the flows related to intangible assets must be analyzed under
the angle of international conventions, in regard to the withholding taxes required and
from the perspective of transfer pricing.

The techniques for assessing tax risks associated with intangible assets
are developed at the level of the accounting verification guide for tax purposes
(annexe2)

c. Tangible assets

The accounting and tax regime for the depreciation of tangible assets has been
profoundly modified by decree no. 2008-492 of February 25, 2008.
Tangible assets can be identified from the following documents:

A detailed statement of depreciation attached to the annual corporate tax declaration.

The table for determining the tax result.
The general balance of the accounts for each audited fiscal year.
The financial statements.
The appendices to the financial statements.

Whether created or acquired by the company, all tangible fixed assets

must be recorded as assets on the balance sheet and are therefore easily identifiable. For an audit
In detail, it is necessary to rely on the precise information provided by the detailed balance sheet or
eventually the general balance of accounts.
The tax result determination table allows to verify that the entity has correctly reintegrated
non-deductible depreciation related to passenger vehicles of a power
superior to nine horses, airplanes, pleasure boats, and secondary residences.
Tax non-deductible provisions subject to extra-accounting reintegration
can be identified. The reversals of non-deductible provisions for tax purposes are
deducted off the books.
Finally, the notes to the financial statements provide detailed information on the methods.
of evaluation applied to fixed assets, on the methods of depreciation and
depreciation applied, as well as on the movements made in the accounts
of amortization and provisions.
The analysis of tax risks related to tangible fixed assets can prove to be very complex.
given the deep divergences that exist between accounting and tax rules.
The auditor will therefore be required to adapt their investigations based on the time available and the
significant characteristics of the tangible fixed assets identified in the entity's balance sheet
audited, keeping in mind that tangible assets are mostly
amortizable, which has the consequence of limiting, in many cases, fiscal risks
identified as facing "timing" risks, the consequences of which are primarily measured in
cash cost and late penalties.
From a fiscal standpoint, tangible asset components must draw the auditor's attention to three
essential points. Firstly, the auditor must verify the correct application by the entity
audited the definition of tangible assets and the criteria that differentiate them from
charges, in order to be able to verify the nature of the expenses recorded as assets, being
it should also be noted that it is during the review of the income statement that
the auditor will be required to verify that expenses classified as fixed assets have not
not been unduly charged (Identification and Evaluation of the risk related to non-compliance
registration rules for assets: appendix 2). He will also need to carefully examine the
depreciations and provisions established (Identification and Evaluation of risks related to
non-compliance with the depreciation rules: annex 2) as well as the formal obligations
related to tangible assets (Identification and Evaluation of the risk associated with a
unjustified disappearance: appendix 2).
The techniques for assessing tax risks associated with tangible assets are
developed at the level of the accounting verification guide for tax purposes (annex 2)

d. Stock accounts:

In accounting, inventory is an asset held for sale in the ordinary course of business.
the activity or in the course of production or intended to be consumed in the process of
production or service provision that will take place later.
Unlike fixed assets, inventories do not constitute means of operation and
are not intended to remain permanently in the company; they are the very subject of
the activity of the latter and are therefore intended to be sold or consumed.
If the entity exclusively holds inventory of goods, it generally engages in
exclusively for a marketing activity, which must result in a figure
business. If the company holds stocks of raw materials, intermediate products or
finished products, it must logically engage in a production activity, the existence of which must
to be corroborated by the existence on the balance sheet of industrial equipment and facilities.
The audited entity may have improperly recorded certain assets of a stock nature in
fixed asset accounts. It may, for example, refer to buildings held by a company.
real estate (Qualification error: appendix 2).
The main accounting and tax issue related to inventory concerns provisions. Also, the auditor
he must obtain a precise detail of the provisions made for stocks.
He must be aware of the specific justifications for these provisions and obtain them.
explanations about the methodology chosen for their determination.
The tax auditor must verify that the stocks that can be the subject of deductible provisions
are made up of products intended for sale. This therefore concerns the stocks of finished products.
held by the company to be sold as part of the achievement of its corporate purpose.
The provisions for inventory impairment should draw the auditor's attention to three
following points :

Non-deductibility of provisions for depreciation of stocks not intended for sale.

Non-application of the capping mechanism: The amount of deductible provisions is
conditioned by two limits:
The limit of deductible provisions in relation to the cost price of goods:
50% of the cost price.
The limit on deductible provisions in relation to taxable profit: 50% of the
taxable profit.
Non-compliance with formal obligations:
Default in producing the statement of provisions for inventory depreciation.
Unjustified destruction of a stock of goods.

The techniques for assessing fiscal risks are developed at the guide level.
accounting verifications for tax purposes (appendix 2).
The documents that allow for the identification and validation of operations concerning inventory.
are as follows:
The monthly tax returns for each audited fiscal year.
The general balance of accounts for each audited fiscal year.
The annexes to the financial statements for each audited financial year.
Schedule of provisions for inventory depreciation attached to the annual declaration.
Minutes of destruction of a stock of goods.
The auditor is able to examine the consistency of the inventory categories held by the entity.
with the activity of the latter, as it was described to him by his client (case of a
annual audit, for example) or as it is presented in the documents of
presentation issued by the assignor as part of an acquisition process. This first
analysis conducted in addition to the examination of the revenue structure allows to
the auditor to target the investigations to be conducted as part of the audit of the result
of exploitation.

e. Operating charges - Suppliers

Operating expenses are a very important issue in determining the

tax result, as they reduce the taxable base and thus generate a
permanent tax savings.
The analysis of operating costs is the central and essential subject of the audit.
Because the accounting entries related to expenses are very numerous, it is
advised the listener to first identify the most significant positions
significant and the most sensitive, that is to say those whose object or nature could allow
the granting of a benefit to a company or to a related individual. Of course, these
sensitive positions vary according to the organization, legal structure, and size of the entity. In
In the context of a small and medium-sized enterprise owned by individuals, the auditor must be attentive to
charges that may have been incurred by the entity in the interest of the operator or
leaders. As part of a larger group, the risks may concern relationships
with leaders, but also and especially intergroup relations.
The main risks related to the deduction of expenses in the context of relationships with
related companies are studied in depth in the section on flows
intragroup (Group companies and partners).
The purchase control is carried out in parallel with the verification of stock plausibility.
and the margin on material cost or the gross commercial margin.
The comparison of the gross commercial margin or the margin on material cost allows for
the tax auditor to assess whether the consumption for the period is plausible by reference
to the company's standards in previous periods, to industry standards and to
the evolution of purchase costs and selling prices practiced.
The main tax issue related to operating expenses concerns the non-deductibility of
charges. The non-deductible expenses for tax purposes are:

Remuneration of majority managing partners (SARL).

Excess gifts and reception fees.
Commissions, fees, commercial or non-commercial rebates, payments
occasional or accidental outside of the main activity and fees not
declared.
Charges related to second homes, aircraft, and pleasure boats that do not
not the subject of exploitation.
Charges related to passenger vehicles with a power rating exceeding nine
horses.
Withholding taxes supported in place of non-resident persons
established in Tunisia under the fees.
Excess expenses incurred for the spin-off.
Travel tax.
Excess interest on associated current accounts.
Transactions, fines, confiscations, and penalties of all kinds.
Excess or undeclared donations and grants.
Established provisions.
Non-deductible depreciation.
Deficits of establishments located abroad.
Corporate tax.
Techniques for identifying and assessing tax risks associated with expenses
operational guidelines are developed at the level of the accounting verification guide intended
fiscale (annexe 2).

f. Operating products - Clients

Operating products can be identified from the following documents:
The monthly statements of each audited fiscal year.
The general balance of accounts for each audited fiscal year.
Status of terminated or canceled affairs attached to the monthly declaration.
Employer's declaration (the rebates must be reported on the declaration of
the employer for them to be deductible from the taxable income. The same applies, according to a
new administrative doctrine for discounts and rebates outside invoices and the
discounts).
Financial statements.
Appendices to the financial statements.
The turnover is the main component of operating products and the one that must
capture the listener's full attention.
In the context of an audit, information on revenue is primarily of interest.
in general, especially when the auditor has little information about the entity
audited. The amount and structure of revenue provide initial elements
very useful about the nature of the company's activity.
In the absence of a table of concordance between declared turnover and figures
business accounted for by the tax function, the verification of operating income
is carried out by establishing a reconciliation table between:

The revenue declared in the sales tax returns

(plates, rates and amounts).
The revenue shown in the income statement as well as the tax accounts
collected (plates, rates, and amounts).

Apart from the general interest it presents, the composition of the revenue of
the company is important in the context of the tax audit since the attachment rules of the
Revenue and taxable income differ depending on whether the activity conducted consists of
in the sale of goods or the provision of services. Furthermore, the auditor must inquire about
the existence of contracts whose execution spans multiple fiscal years. This information
does not appear directly in the income statement, but it should in principle be
mentioned in the sales contracts established.
In addition to the actual revenue, the auditor must carefully consider the others
products. The latter, recorded in account 73, correspond to operating income
which are not included in the calculation of added value, being not considered as a
element of the company's production. It mainly concerns products, revenues from
properties not allocated to professional activities (account 732), attendance fees and
compensation of directors (account 733). The analysis of these items can notably
to identify flows with companies or individuals linked to the entity
audited.
The auditor will also check for the existence of operating grants that are
subsidies intended to compensate for the shortfall of certain operating products or of
address certain operational costs. The auditor will thus need to identify their source,
notably to determine if they involve particular tax risks.
The other components of operating products are stored production, production
frozen and the transfer of charges. These accounts reflect 'technical' entries
regularization that should in principle not entail any tax risk if the related rules on
the registration of goods produced by the company as inventory or fixed assets is
correctly applied.
The variation in stocks, whether positive or negative, is recorded in account 71 and is
included in the exercise results. The fixed assets production is recorded as income.
for its production cost (account 72). The expense transfer account (account 79) allows
to technically cancel the charges initially recorded.
Similarly, beyond the efforts related to operating products, the tax auditor must
focus their work on the following points:

Risks related to the recognition of provisions for impairment of customer receivables

(annex 2).
 Risks related to the non-implementation of the capping system (The provisions for
depreciation of doubtful receivables meeting the conditions for deductibility are
deductible up to 50% of the taxable profit: appendix 2).
Risks associated with non-compliance with formal obligations (Appendix 2).
Risks related to the evaluation of foreign currency receivables (Annex 2).

Tax risk assessment techniques are developed at the level of the guide of
accounting checks for tax purposes.
II. Opportunity Audit

In terms of compliance control, the tax audit allows for the assessment of conformity or not to the
tax rule of operations or decisions examined and therefore a review of the flaws and
existing irregularities.
On the other hand, for the control of tax efficiency, the approach is more complex due to the fact that
the tax auditor will have to reveal the omissions made by the company, particularly for the
favorable regimes that she could have benefited from
Likewise, this second part of the tax audit mission must highlight the operations
that the company could or could have handled tax matters more opportunely.
Thus, this assessment is necessarily relative due to such dependency on
conditions specific to the facts examined and the particular context in which it is found
the audited company.
Tax efficiency seems to be a fairly fluctuating concept, resulting from a balance between the
legal and tax resources of each company.
The auditor will first perform the review of the framework of tax efficiency and then
in a second phase, the control of tax choices.

1. Control of the framework for tax efficiency

The goal of this step in the mission is to examine the company's tax system.
allowing for tax efficiency.
The verification of the framework of tax efficiency is primarily based on the examination:
From the tax dashboard (a).
The effective tax rate (b).

a. Tax dashboard
Organizations aware of the importance of monitoring their tax performance can
to provide a true tax dashboard for better efficiency, depending on
needs and the importance of the tax burden supported. Bouquin (1988) defines the table of
dashboard: "decision-making and forecasting tool, the dashboard is a set
a small number of indicators (five to ten) designed to enable managers to make
knowledge of the state and evolution of the systems they manage and to identify trends
who will influence them within a horizon consistent with the nature of their functions.
In general, a dashboard offers the advantage of enabling better management on a daily basis.
thanks to better readability of the activity through the integration of political dimensions,
administrative and technical within a quality approach. It should allow for the anticipation of
events through a combined analysis of different types of information. The implementation
A tax dashboard that will come from management must be part of a perspective of
the internal tax organization. The tax dashboard, like any dashboard, must
to be a flexible dialogue tool for better organizational responsiveness. As a
as a management tool, it should allow for better coordination within the company
that a rapid, simple, and dynamic communication of the tax information it groups together and
vehicle in a synthetic manner. It thus ensures operational monitoring, control and a
evaluation of the organization's tax management in the short term but also in the medium and long term
Term. Decision support tool, the tax dashboard must serve as a support for decision-making.
collective present and future, by providing information feeds intended for the
decision-makers, at all levels, and not just limit themselves to observing situations. Its effectiveness can at
remaining to be measured both by the number of decisions and corrective actions taken and by
the number of dysfunctions observed thanks to its implementation. The competence of
Members of the tax function are a key lever in this regard.
Fiscal performance indicators can take the form of ratios integrated into a
tableau de bord fiscal permettant le suivi de la réalisation et l'optimisation des opérations. Il
it is about ensuring the achievement of the set objectives in terms of performance, profitability and
respect for tax management policies and consequently the general policy. Its
elaboration requires prior definition of a real methodology, in order to identify
clearly the used concepts, ensuring their follow-up and controlling their coherence and relevance.
The recognition and selection of useful and relevant indicators for decision-making
constitutes without a doubt a crucial step, even if the dashboard will necessarily
the object of later adaptations. This is a key step that conditions subsequent use
even the table by the leaders; thus the indicator must classically be reliable (data
controlled and validated), quality (reasonable turnaround time), clear (readability), evocative
(to facilitate dialogue), updated, complete and faithful. The validity of the tax dashboard
depends, therefore, largely on the quality of the internal procedures implemented,
taking into account the operational constraints and the organizational context in the
preparatory process for the development of the tool. This consideration is essential for
mobilize all the stakeholders who must be fully involved in the reflection. A
full and complete understanding of the entity's tax policy, its success factors
and its implementation is therefore necessary for this purpose.
This table can specifically include the effective tax rate as an indicator. The
The dashboard also allows for calculating and explaining margin variations over time.
and in space by economic and verifiable elements, in order to prevent the risk of
resort to analytical methods and assumptions.
The tax dashboard ensures a relative homogeneity of the basic indicators and
to prevent and avoid drastic fluctuations.
In the absence of a tax dashboard to present indicators
On alert about fiscal risks, the tax auditor will have to recommend the implementation of this
tool.

b. The effective tax rate (ETR)

The concept of tax performance of the audited entity can be evaluated notably by the rate.
tax rate (TEI).
The effective tax rate is a financial indicator that measures the company's ability to
optimizing its tax base; it is determined by the ratio of the sum of payable taxes
and deferred items recorded by the audited entity and the accounting result before tax of the latter.
The effective tax rate (ETR) allows the auditor to assess in advance the quality of the
fiscal performance of the audited entity due to the TEI reflecting the tax impact of decisions
of the company.
The information related to the TEI is sensitive, an increase in net income per share of 1.5 to
2% can be obtained by reducing the TEI by 1%, while a 10% increase in the figure
Business is generally necessary to achieve an equivalent goal.
Significant variations in TEI from one year to the next are perceived as the
consequence of a lack of control over tax risks and a possibility of
ignorance of tax benefits.
The TEI ratio can allow the auditor to assess whether the company has utilized all levers.
possible to reduce one's tax result and thus engage in comparative studies
sectoral; it also allows for measuring the level of risk but also the quality of the strategy
adopted tax. It is a true vector of tax communication.

2. Control of tax choices

Efficiency results from 'an intelligent use of taxation'. That's why the company
must be able to adapt a more dynamic behavior towards the tax parameter
by making more or less wise tax choices and consequently modulating the
tax burden it bears. The tax auditor will therefore have to rule on the effectiveness of
the company both in terms of tactical choices (a) and strategic choices (b).

a. The control of tactical choices

After having previously carried out a general understanding of the company,

the auditor has all the necessary information; if applicable, proceeds by
additional questions and consequently establishes a comprehensive list of schemes
incentive or favor from which it can theoretically benefit. Compared to reality, it puts
highlight the provisions that have been omitted or ignored; thus, the contribution of the tax audit is to
raise awareness in the company about the importance of the gap between potential tax efficiency and
the achieved tax efficiency.
As for the control of options, the auditor can take the same systematic approach.
used in the evaluation of preferential schemes and consequently identify a
reconciliation. He appreciates the validity of the options exercised. In other words, he is looking to see if
they are carried out according to relevant and appropriate criteria. Likewise, it determines the
neglected options and subsequently assess the loss of earnings.
If the audited entity carries out VAT-exempt operations and the auditor notes from the
phase of the general knowledge that the products exempt from VAT are intended for
for export and/or to supply other persons subject to VAT, the option for
l'assujettissement notamment partiel des produits exonérés présente un intérêt surtout lorsque
the circuit is not fully exempt and therefore includes inputs (representing
a significant portion) subject to VAT.
In the absence of exercising this VAT option, the tax auditor will have to recommend it at the level
of his improvement plan. Indeed, he will need to clarify in his audit report the
avantages fiscaux de l'exercice de l'option pour l'assujettissement des produits et opérations
exempt from VAT.
The benefits arising from the exercise of this option can be enumerated by the tax auditor at
the level of his audit report is:

To benefit the taxable client from the right to deduction and to consequently be more
competitive regarding this type of client.
Reduce the cost of management fees and fixed assets of the VAT that burden them.
 Avoid the 25% increase applicable to imports.
Be more competitive in exports.
To be able to sell VAT-exempt to authorized persons.
Be more competitive for businesses, where the profit margin is lower than
25%, for products subject to the 25% increase for non-taxable persons.
Prevent a parent company from being subject to VAT on the sale price of the
subsidiary not subject and not on the sale price of the parent company to the subsidiary. In this case,
the option for the subsidiary's taxation prevents the parent from being subject to a tax base
constituted by the sale price of the subsidiary and allows the latter to recover the
VAT incurred on its purchases and to pass the VAT on to its taxable customers.
The control of tactical choices is a simple control that uses traditional tools.
the audit notably the questionnaires, the interviews, the direct examination of the accounts and the
company documents.
The control of tactical choices is not limited to the sole examination of the relevance of the choices or
exercised options and the detection of any overlooked choices. But it must also evaluate the
risk associated with this choice?
It should not be overlooked that issues of tax choices or options are associated with
the fulfillment of certain conditions, which means that the company's scope of action is
limited. It is in this context that improper use of these choices and options does not contribute
more to tax efficiency but to develop risk in the tax field as well as in
other non-tax areas and more particularly accounting.
The tax choices and options are subject to compliance with conditions and limits related to
taxable profit, related to the nature of the activity, to the submission of an investment declaration, to the
deadline, etc.
The auditor is required to verify that the company has complied with these conditions, otherwise he must
measure the resulting risk.
If it turns out that the company does not meet the required conditions or ceases to meet them, it
risks the forfeiture of the option and is exposed to adjustments and potentially
fines. To this end, in order to validate a physical tax relief that the company has benefited from,
the auditor must ensure:

That the physical relief was the subject of an investment declaration filing at
the API.
That the financing scheme for the investment respected the minimum funds
property set by decree No. 94-489 of February 21, 1994, as amended and supplemented
by the subsequent texts.
That the physical relief was the subject of a separate presentation at the balance sheet.
special investment account
The amount recorded in the special investment account has indeed been incorporated into
capital at the latest by the end of the year of the establishment of the reserve.
That the acquired assets in the context of the investment must not be
ceded for at least one year from the effective date of entry into production.
That the capital must not be reduced during the five years following the date of
the incorporation of profits and invested revenues, except in the case of reduction for
absorption of losses.
That the corporate tax declaration must be accompanied by the program
of the investment to be made and the commitment to make the investment no later than
the end of the year of the establishment of the reserve.
The tax audit not only aims to verify the validity of the choices made, but
it also has a role in monitoring the options or choices made; it ensures that the effectiveness
taxation is not in itself a source of tax risk. The multidisciplinary expertise of
The tax auditor must also allow him not to limit himself to highlighting.
des risques fiscaux, mais de la même façon, de mettre en lumière les choix fiscaux dont
the exercise is likely to generate a risk in the accounting field.
The tax auditor is required to assess that the choices made are not in contradiction with
the accounting rules and methods, and that the search for fiscal optimization is done in
concordance with the sincerity and reliability of financial information.
At the end of the examination of tactical choices, the auditor is able to express an opinion on
the company's ability to use the tax options and choices available to it but especially to
to propose to the audited company recommendations that allow it to improve its level
of tax efficiency.
On this point, the audit should not be limited to listing what the company could have done and by
consequently the advantages she could have gained. Such an approach is indeed
necessarily limited. On the other hand, the audit must highlight the reasons that have
caused the omissions noted and recommend measures intended to avoid their
renewal in the future.
The audit report must express an opinion on the methods and criteria chosen by the company.
to exercise tax choices. The auditor can specifically make suggestions on the
modifications that must be made to the existing procedures.

b. The control of strategic choices

In terms of strategic choices, there is an opposition between the control of choices.
past taxes and the anticipated tax choices.
Thus, for past strategic choices, the auditor should not limit themselves to highlighting the
shortcomings observed in the past but, on the contrary, it must illuminate the audited society
on the modifications that could be made and that are likely to improve the
level of tax efficiency.
For the strategic choices considered, the auditor must assess whether the tax solutions are the
mieux adaptées et vérifier qu'il n’y a pas d'autres alternatives fiscales plus adéquates et si
The audited entity has perceived all the parameters related to the choice.
The auditor's approach in the context of monitoring tactical choices is to conduct a
general awareness of the audited entity followed by an examination of the effectiveness framework
fiscal (Evaluation of the tax information system through the effective tax rate
and the tax dashboard) and finally to a proper control of fiscal choices. In the
in the domain of strategic choices, the auditor will give a privileged place to the first and
the third phase. He must undergo a thorough examination of the choices made, but without
just as much neglect the phase of general awareness, given the reference
permanent in the assessment of the opportunity of choices, to the situation of the company and to its
general policy objectives.
As for the study of strategic choices, the auditor can only ensure the validity of the
approach followed by the company to make the choice in question.
The tax auditor aims to control the proper assessment of the benefits and constraints associated with
choice exercised or considered.
The advantages and disadvantages are assessed based on the criteria of tax efficiency.
to know in particular the financial criterion, but also the auditor can check the consistency
of choice, as well as its simplicity, flexibility, and security.
The tax choice must be financially suitable.
The tax choice must be a coherent choice.
The tax choice must be simple and flexible.
The tax choice must be simple and flexible.
 CONCLUSION

In the face of the multiplicity of existing taxes and levies in Tunisia and, consequently,
complexity of the tax system, it was not possible to present a complete description of
two elements of the tax audit: Compliance audit and opportunity audit.
The control of regularity borrows in its approach the traditional tools of auditing and
reveals potential synergies with financial auditing. The approach of control
tax efficiency seems to indicate, on the other hand, that the control of certain types of choices, and
in particular strategic choices, order to prioritize a case-by-case approach to
spending on more systematic forms of control.
There are also obstacles and limitations in the implementation of the audit that impose on
do not consider this mission as a cure for all the fiscal ills that suffer
the company. That is why it is appropriate not to give the auditor more powers than he
not to expect from him an infallible diagnosis and therapy
 CHAPTER 3: The tasks performed and the
conducting a tax audit within
SORIAC

INTRODUCTION :
Rachadi Industrial Automobile and Body Company (SORIAC) is a company that
limited liability company (S.A.R.L) with a capital of 32,000,000 DH. It is located in the
leading position in the industrial vehicle manufacturing market. The company SORIAC has been
founded by Mohammed RACHADI on 31/12/1989.
In 1990, she obtained the assembly approval in Morocco and the exclusive representation.
industrial of the SCANIA SWEDEN brand. Its activity was centered around importation,
the assembly, marketing, and provision of after-sales service. During the same
year, SORIAC changed its legal form from a public limited company to a limited company.
limited liability. 27 "Seeking an explanation before knowing all the facts is a
capital error. The judgment is distorted. » In 1995, SORIAC signed a contract of
sale with an option to buy back after three years, under which SCANIA SWEDEN would be entitled to 68
% of SORIAC shares. In 1997, Mr. RACHADI repurchased the said share.
becomes once again the owner of 100% of the shares of SORIAC. In the same year,
SORIAC has become a subcontractor of SCANIA Morocco, which is controlled by SCANIA.
SUEDE. In 2009, SORIAC signed a partnership with CAETANOBUS MOROCCO, a
Portuguese public limited company, with a capital of 40,000,000 DH.

The fact sheet:

Business name : SORAIC

Legal form: Limited Liability Company

Creation date: 1989

Head office : Industrial zone, Marrakech road, BP: 156

Berrechid

President : M. Chafik RACHADI

General Manager: M. Hassan RACHADI

E-mail : Info@[Link]

Patent : 40720057

SORIAC performs the following operations:

The assembly: SORAIC proceeds to assemble vehicles of the brand (HINO,
HYUNDAI, JAC) and the assembly of utility vehicles for ASIAN HALL
(small and medium trucks, tractors, buses and coaches) within its
workshop. First of all, it receives spare parts either completely
detached or partially detached. Then, it performs the assembly. At the end
of the assembly process, SORAIC controls the quality of the finished product before its
delivery to customers;
 The painting: SORIAC has set up harnesses for painting and the
treatment of aeronautical elements. Its good paint quality allowed it to be
certified by Dassault Aviation;
The bodywork: It manufactures bodywork of all types, for coaches, buses,
tractors, etc.

I. The tasks performed and the problems detected:

[Link] tasks performed:
a. The classification of supporting documents:
The classification of accounting supporting documents that characterize activities and the
daily operations of the company are carried out through chronological binders, that is to say by
chronological order according to the nature of the document.
And in order to facilitate the passing of accounting entries and the search for a document in case
as needed, we organize the files into homogeneous subfolders: sales file, file
purchase, bank file, cash file, etc.

b. The recording of accounting entries:

The accounting of supporting documents is done on a daily basis. It is carried out
as follows:
Purchase journal: the posting is done by referring to the invoice. We debit a
account of charge 61102 and an account of recoverable VAT on this charge 34552 by
a supplier account 44110. Sometimes, there are certain invoices that are not
subject to VAT, the accounting is done as follows: we credit a
supplier account and we debit an expense account.
Sales journal: the posting is made according to the invoice, we credit an account of
client 34210 by crediting a product account 71110 and a billed VAT account
44550.
Bank journal: accounting entries are made directly from the statement.
bank or any bank document. However, a bank reconciliation statement must
to be established with the aim of reconciling the bank balance with that of the bank journal.
Cash journal: transactions are conducted in cash. This may involve either a payment
supplier, whether for purchases, employee compensation, or cash inflows in
species, etc.
c. The account verification:
If the previous task involves recording accounting entries from documents, this one involves
in drawing from the pre-established journals and the recovery of the files they represent.
The objective of account verification is to ensure the proper use of accounts.
appropriate and the respect of the dates appearing on the invoices.
During this verification, errors on the margins of the different newspapers must be identified and
make the necessary corrections. This process ensures accuracy.
operations and update the pre-entered logs.
d. The entry of accounting records:
After a manual accounting of the accounting documents, we proceed with the entry of the
the help of an accounting software called 'Sage Saari Accounting'. The data entry is done
in a simple way with the possibility of correction in case of a potential error. This
software, adapted to the financial management system, includes four modules:

Accounting module;
Commercial management module;
Payroll module;
Human resources management module.

The use of Sage Saari indeed relies on the documentation and information provided.
by the accounting department.
e. The analysis of the accounts:

The analysis of accounts proves to be a very important task after data entry. It is an analysis
situation accounts; for example, the supplier account, the customer account, the account
bank, the cash account, etc.
The analysis allows one to pronounce on the account situation and to qualify it as either debtor.
be a creditor. Based on this assessment, the company decides on the nature of the action to
to implement -for example-, either the company owes money or it has to pay
money.
2. The identified problems:
a. First problem:
The company SORIAC is encountering a problem with analytical accounting after the
end of the partnership. During our internship, we made some recommendations for
to address this problem. Before choosing the appropriate method, one must adhere to the constraints
following.

Nature of the company's activity: SORIAC, the industrial company, will seek
first of all to detect the activities and centers that are at the origin of the largest part
important charges. She will focus more on the charges affecting each
produced or consumed by each section or by each work center.
Management nature of SORIAC: The company SORIAC has just chosen a mode of
more decentralized management. The shift towards this management mode requires, in our
opinions, a prospective management, budgeting, and an analysis of expenses and products
by center of responsibility. This justifies our choice by principle.
The cost of implementation: In order to control the costs of products and
services, it would be foolish to ignore the cost criterion for the implementation of the
operational analytical accounting. These explain the rejection of the method of the
activity-based accounting which promises to be very costly.
The company SORIAC therefore needs a processing system tailored to its requirements.
specific. In other words, a less expensive and more flexible system while respecting
the philosophy of management control.
The choice of the method will primarily depend on the objectives pursued by the
cost analysis system. And to understand the consumption by
 productive work center and by product, the company must necessarily go through
the adoption of the full cost method.
However, the difficulty of dividing the company into homogeneous sections without multiplying them
the number, the calculations that need to be implemented are often difficult, the analysis
late qualification of costs and the neglect of the impact of activity variation on the
coûts, constituent tous les limites de notre démarche pour la méthode des coûts
complete.
[Link] problem:
We noticed during our internship that the accounting department lacked rigor.
regarding the VAT declarations and turnover. This raises questions about their validation.
subsequent.
It was suggested to the accounting department to use preparatory tables for VAT and the
turnover. The first table consists of a summary of the VAT accounts.
It includes both the invoiced VAT and the recoverable VAT.

II. The realization of the tax audit within SORIAC:

Periodically, the company SORIAC conducts tax audits to assess the risk.
to which she is exposed and to implement a tax risk management program.

1. The realization of the audit:

a. The preliminary phase:

The preliminary phase is a diagnosis that determines the terms of the mission in terms of
feasibility, deadline, cost, and objective. The mission is possible within a timeframe set at 10 days and the
expenses amount to 35,000 DH.
The objective of a tax audit is to obtain sufficient assurance regarding the accuracy of the statement.
expenses and revenues in accordance with the common slides of the tax law. The
The verification will focus on tax returns, accounting documents that have an impact.
on taxation and the procedures used. To this end, the tax auditor must verify all the
operations according to criteria defined in the mission letter.
b. The general awareness of the tax issue of SORIAC:

A range of information and documents has been provided to the audit team,
what allowed an understanding of SORIAC's activity. Nevertheless, there remains to
to know and understand certain tax specifics of the company in order to identify and detect the
areas of fiscal risks. In this regard, several recommendations have been suggested:
The collections from the sales of the company SORIAC are made at approximately 60% in
species.
The company makes both local and foreign sales;
The company has several partners. Work needs to be done in the
measure to validate the tax treatment of its operations.

c. The study of internal control related to the tax function of SORIAC:

A manipulation of the files and conclusions was carried out by the tax audit team, in
the framework for an evaluation of SORIAC's internal control. It is an apprehension of the
organizational quality of the company through an examination of the main procedures
(purchase, sale, inventory, fixed assets, cash flow, etc.).
In other words, it is a general assessment of internal control conducted at the accounting level.
at the fiscal level. It is generally a thorough assessment of the tax field.
At this level, an additional summary note can be prepared, determining the strengths
and the weaknesses of the current system of the SORIAC company.
d. The control of SORIAC's tax operations:
The tax questionnaire:
The tax questionnaire in Appendix No. 3 is completed with the collaboration of
the auditor and the tax service. The responses to this questionnaire contributed to the development of
work schedule.

The tax declarations of SORIAC:

The entire set of tax documents from SORIAC has undergone thorough examination for
detect a potential risk that may arise from either a:
bad declaration;
declaration filed late;
absence of tax or duty payment.
In this context, the review of SORIAC's tax statements revealed that the
remunerations allocated to third parties required by article 151 of the general tax code (CGI), has not
not been filled out correctly. As a result, the company is exposed to a fine of 25%
of the amount corresponding to the missing information by applying Article 194 of the CGI.
In addition, the company SORIAC has not submitted the annual summary declarations of
withholding at source applicable to the payments for services provided abroad, such as
it is provided for by Article 154 of the CGI. Thus, SORIAC is liable to a fine of 15%
applied to this amount.

e. The tax audit report of SORIAC:

The engagement letter specifies the terms under which the tax auditor should
communicate the conclusions of one's work. The communicated conclusions are the inventory
of the various irregularities encountered, accompanied by an estimate of the tax impact in
taking into account the increases and penalties incurred. For the company SORAIC, the various
The irregularities raised are:

Cash receipts exceed 60%:

The company SORIAC collects about 60% of its revenue in cash. Consequently,
elle s’expose à une amende de 6% pour les factures qui dépassent 20 000DH encaissées par
species.
In this regard, Article 193 of the CGI states that: "independently of other sanctions
fiscal, any settlement of a transaction with an amount equal to or greater than 20,000 DH,
carried out other than by non-endorsable crossed check, bill of exchange, means
magnetic or electronic payment method or bank transfer gives rise to
the application against the selling company or verified service provider of a
a fine of 6% of the amount of the transaction made...
The estimation of fines related to cash collections over the three years
previously amounts to 9,347 DH.

Provisions for inventory depreciation:

SORIAC considers provisions for stock depreciation as deductible expenses.
a rate of 100% for products with low turnover. Even if their probability of being
sale is very important.
In addition, forecasts are calculated in a general way without reference to details.
applying article 8 of the CGI, the company SORIAC faces the risk of integration of
These provisions. The estimate of this risk amounts to 38,270 DH.

Receipt stamps on cash collections:

The company SORAIC does not submit cash sales invoices to the stamp duty.
receipts. In this regard, article 8 of the stamp states that the absence of stamps exposes the
company received a fine.
The risk estimate regarding stamp duties is in the order of 51,607 DH.
Provisions for doubtful debts:
The company SORIAC considers provisions for depreciation among its deductible expenses.
customer receivables that are older than 6 months. Indeed, the provision is
calculated in a global manner without any details established for each client.
These forecasts as calculated do not meet the conditions for deductibility.
required by the tax administration, because they are not detailed by client and make
the subject of a legal appeal, as provided for by article 10 of the CGI.
The company SORAIC is then faced with the risk of integrating these provisions.
The estimated risk related to this provision is around 88160 DH.

The value added tax (VAT) on service charges invoiced on

foreign suppliers:
The company SORIAC relies on foreign suppliers for various services.
service.
To do this, suppliers are required to appoint a representative residing at
Morocco, in order to subscribe to their declarations of taxable turnover and consequently be
subject to the applicable tax. Furthermore, the value-added tax and the associated penalties
are at the buyer's risks and perils.
These services were not subject to the Moroccan value-added tax of the company.
So, the estimate of the risks of VAT refunds for the three years
The previous amount is around 152,207 DH.
The treatment of compensation for income tax:
The company SORIAC grants its staff during the holiday period, allowances of
representation18, without subjecting them to income tax.
Considering them exempt from income tax, SORIAC ignores the benefits and does not
does not take into account in the calculation of income tax.
On the other hand, the administration can refuse the non-taxation of these allowances even if they
are granted during staff leave. The estimate related to this risk is around 2
932 284 DH.

Conclusion:
The use of tax control is the direct and logical counterpart of the declarative system.
who wants the tax to be established based on the taxpayer's declarations, and is the subject of a
subsequent control by the tax administration.
This possibility poses a formidable and unavoidable threat if the company does not know
not her rights and her tax obligations or if she does not implement measures to address the
tax risks.
The necessity of tax management is emphasized by Maurice COZIAN: 'Everyone recognizes the
necessity of good financial management, good commercial management, good
social management, they condition the development, or even the survival of companies. We
doubt, on the other hand, that there can be good fiscal management, some reject it in the name
some endorse fiscal fatalism; others disapprove of it, confusing it with tax cheating. The most
the informed practice it, who are neither fatalists nor cheaters, but good managers.
However, good tax risk management necessarily involves an audit and a
diagnosis of taxation within the company. The audit then allows for the assessment and evaluation of
strengths and weaknesses in order to highlight the potential tax risks involved
about the company. It helps to shed light on uncertainties, tax questions regarding
the entity and then facilitate decision making. The recommendations and advice resulting from
this diagnosis contributes to the fiscal security of the company and participates in the improvement of its
tax management. This measurement procedure remains useful and necessary to avoid or
to anticipate tax audits.