Tax Audit Framework clean copy -merged

TAX AUDIT FRAMEWORK Tax Audit Framework  TABLE OF CONTENTS Page No. 1) Introduction 3 2) Tax Audit Concept 5 3) Statement of Additional Information 9 4) Contents of Engagement Letter for Audit under Section 177(8) 12 of the Income Tax Ordinance, 2001, Section 32A of the Sales Tax Act 1990 and Section 46(4) of Federal Excise Act 2005 5) Audit Report 17 6) The Process of Tax Audit 20 7) Exclusions/ Exceptions 23 8) Fees 25 9) Procedures for Tax Audit 27 10) Selection of Auditors and Auditees for Tax Audit 30 11) Annexures A – Independence Declaration by Tax Auditor 34 B - Engagement Letter 35 C - Auditors’ Report to the Commissioner of Income Tax 39 D - Auditors’ Report to the Collector of Sales Tax 40 Model statements of additional information for: E Manufacturing 41 F - Services 59 G Banking 75 H- Oil & Gas Exploration 91 I - Insurance 110 J- Sales Tax & Federal Excise 124 1  Tax Audit Framework TAX AUDIT –DEFINITIONS AND ABBREVIATIONS TAX AUDIT Audit of Tax Statements TAXPAYER Assessee who is required to get his Tax Statements audited by Tax Auditor under Tax Audit Framework TAX LAWS Income Tax Ordinance, 2001, Sales Tax Act, 1990 and Federal Excise Act 2005 TAX AUDIT REPORT ...