Undertaking a tax department implies facing a whole complex taxation system. Facing the tax authorities is a constant challenge. And an inattention to standardized procedures can lead to problems with tax authorities.
Unfortunately, complying with all tax legislation and always behaving focused on lawful activities can be difficult tasks to balance.
In this scenario, accounting audit procedures in a compliance structure allow the legal adequacy of its activities and shielding from illicit processes.
Through critical diagnostic activities that cover the entire operational and legal structure of your company, it is important to consider audit processes in your tax compliance structure.
But what is tax compliance and what is the importance of corporate auditing firms in this context?
In this article we will address the concepts of compliance and accounting auditing, indicating the importance of auditing and taxation services in the structure of your company.
What is Tax Compliance?
Tax Compliance represents a set of actions to frame and adapt the legalized functioning of companies, from the regulatory and tax point of view.
In literal translation, the concept of compliance is similar to that of obedience to the regulations and tax rules in force in a given country.
These measures are, on the one hand, preventive and, on the other hand, proactive. They avoid actions that may generate legal damages to companies, especially under the tax aspect. At the same time, they ensure regular and safe operation.
That is, they act both in preventing illegal actions, as well as ensuring a certain operational and corporate credibility of the company.
From a managerial point of view, tax compliance represents a useful tool that allows greater security in the operation of the company. And, for this reason, the larger the structure, the more intense the need for judicious processes.
Some benefits of tax compliance
- Greater credibility in the market;
- Regulatory-tax security;
- Operational shielding against deviations or misconduct;
- Tax planning and risk management.
It is worth noting that, as such strategies are adopted and continuously implemented, greater profitability may emerge as a complementary result.
Bearing in mind the careful assumptions of tax compliance regarding the adequacy and legal framework, this set of actions ensures, in parallel, reliability, sustainability, and longevity of the business. This set of tax compliance activities includes accounting audit processes.
This specific field carries out the detailed examination of accounting records, documents, and other elements that prove the adequacy of accounting principles and, above all, the control of the company’s assets. But what is the importance of accounting audit in Tax Compliance processes?
Understand the importance of accounting audit in tax compliance
While tax compliance is understood as managerial conduct in the face of the legality of a company’s tax structure accounting audit is seen as a means to achieve compliance objectives.
In this way, the accounting audit demonstrates its importance as a structured and assertive methodology aimed, above all, at guaranteeing the legality of the accounting operations and tax situation of a company.
As a process, it allows tax compliance objectives to be effectively achieved. Likewise, understood cyclically and continuously, the accounting audit shares the same objective of a good tax compliance structure.
- Diagnose the structure;
- Ensure tax security;
- Mitigate or avoid risks;
- Optimize and correct processes.
In other words, the accounting audit actively participates in a tax compliance structure. As a result, in recurring scenarios of audit processes, the organization acquires a certain accounting vitality.
If your company wants to establish an efficient tax compliance structure, count on Accounting Audit Service.
This content is meant for information only and should not be considered as an advice or legal opinion, or otherwise. AKGVG & Associates does not intend to advertise its services through this.