02.1 Taxes PRA
2
Any Company 17 18 Process Risk Analysis (PRA) Prepared by Reviewed by Decreases 1 Increases 0 ●Tax fling ●Tax calcu E&O C R&O V&A P&D ● ● 5 5 7 Risk Number R-02.1.1 R-02.1.2 Process Description H H H H 2007 2008 Reason for Change ------------------ Net Change in Key Controls Existence and Occurrence Completeness Rights and Obligations Valuation and Allocation Presentation and Disclosure Tax flings incorrect. Tax calculation error resulting in exposure. Control # Control Activity Test Procedures Control Activity Short Key Control Totals 6 5 (1) 5 5 5 5 1 5 10 2.1.01 The annual state and federal tax returns are prepared by Outside Party accordance with their annual tax engagement. The return is reviewed and approved by senior financial management prior to signing and filing. Obtain tax returns and cover letter prepared by Outside Party : 1. Confirm that the return prepared by Outside Party was signed by senior financial management prior to filing. Third party expert provides advice and prepares and files Federal and State returns. KEY KEY X X X X H H 2.1.02 On a quarterly basis, a tax completion checklist is used and signed by tTax Manager and the Financial Controller. Confirm that the quarterly tax completion checklist has been completed and signed by the Tax Manager and Financial Controller Quarterly tax completion checklist used. KEY KEY X X X X M 2.1.03 On an annual basis, the Tax Manager performs a "true up". Reconciling the tax returns as processed with the accounting records. Review the annual True up journal entry and agree to supporting documentation and ensure it is appropriately authorized. Annual reconciliation of tax return with accounting records. KEY KEY X X X X M H 2.1.04 An off the shelf tax application package is used to complete tax calculations on an annual basis. Retired 2008 KEY Rtd Other X X X 2.1.05 On a annual basis, a tax completion checklist is used and signed by the Tax Manager and the Financial Controller. Confirm that the annual tax completion checklist has been completed and signed by the Tax Manager and Financial Controller Annual tax completion checklist used. KEY KEY X X X X M 2.1.06 Parallel run of new FAS TRAC 109 and the prior Excel spreadsheets used for tax calculations, for the June Quarter Retired 2008 Std Rtd Other 2.1.07 Tax Manager segregated from any GL input initiation or authorization. This test should be done in conjunction with testing of control # 1.4.04 since it uses the same test documents. Confirm that the Manager Tax does not have access to General Ledger for data entry Tax Manager cannot approve or book an entry to G/L KEY KEY X X X X X Describes activities required to accurately and completely calculate and records the tax provision and tax assets/liabilities in accordance with generally accepted accounting principles, SEC, federal, state and local tax regulations. This process includes the calculation of the tax liability for federal and state. Assertions 02 Taxes 02.1 Taxes Key Control Changes Control Level 02.1 Taxes PRA.xls 2/11/2009 1:03 PM PRA 1 of 2
description
PRA for taxes
Transcript of 02.1 Taxes PRA
Any Company 17 18
Process Risk Analysis (PRA) Prepared by
Reviewed by
Decreases 1
Increases 0 ●Tax fling ●Tax calcuE&O C R&O V&A P&D ● ●
5 5 7 Risk Number R-02.1.1 R-02.1.2
Process Description
H HH H
2007 2008
Reason for Change
------------------
Net Change in Key Controls
Exi
sten
ce a
nd O
ccur
renc
e
Com
plet
enes
s
Rig
hts a
nd O
blig
atio
ns
Val
uatio
n an
d A
lloca
tion
Pres
enta
tion
and
Dis
clos
ure
Tax
flin
gs in
corr
ect.
Tax
cal
cula
tion
erro
r re
sulti
ng in
expo
sure
.
Control # Control Activity Test Procedures Control Activity Short
Key Control Totals 6 5 (1) 5 5 5 5 1 5 102.1.01 The annual state and federal tax returns are prepared by Outside Party
accordance with their annual tax engagement. The return is reviewed and approved by senior financial management prior to signing and filing.
Obtain tax returns and cover letter prepared by Outside Party :
1. Confirm that the return prepared by Outside Party was signed by senior financial management prior to filing.
Third party expert provides advice and prepares and files Federal and State returns.
KEY KEY X X X X H H
2.1.02 On a quarterly basis, a tax completion checklist is used and signed by thTax Manager and the Financial Controller.
Confirm that the quarterly tax completion checklist has been completed and signed by the Tax Manager and Financial Controller
Quarterly tax completion checklist used. KEY KEY X X X X M
2.1.03 On an annual basis, the Tax Manager performs a "true up". Reconciling the tax returns as processed with the accounting records.
Review the annual True up journal entry and agree to supporting documentation and ensure it is appropriately authorized.
Annual reconciliation of tax return with accounting records.
KEY KEY X X X X M H
2.1.04 An off the shelf tax application package is used to complete tax calculations on an annual basis.
Retired 2008 KEY Rtd Other X X X
2.1.05 On a annual basis, a tax completion checklist is used and signed by the Tax Manager and the Financial Controller.
Confirm that the annual tax completion checklist has been completed and signed by the Tax Manager and Financial Controller
Annual tax completion checklist used. KEY KEY X X X X M
2.1.06 Parallel run of new FAS TRAC 109 and the prior Excel spreadsheets used for tax calculations, for the June Quarter
Retired 2008 Std Rtd Other
2.1.07 Tax Manager segregated from any GL input initiation or authorization. This test should be done in conjunction with testing of control # 1.4.04 since it uses the same test documents. Confirm that the Manager Tax does not have access to General Ledger for data entry
Tax Manager cannot approve or book an entry to G/L
KEY KEY X X X X X
Describes activities required to accurately and completely calculate and records the tax provision and tax assets/liabilities in accordance with generally accepted accounting principles, SEC, federal, state and local tax regulations. This process includes the calculation of the tax liability for federal and state.
Assertions
02 Taxes02.1 Taxes Key Control
Changes
Control Level
02.1 Taxes PRA.xls 2/11/2009 1:03 PMPRA 1 of 2
Any CompanyProcess Risk Analysis (PRA)
5 5 7
Process Description
2007 2008
Control # Control Activity Test Procedures Control Activity Short
Key Control Totals 6 52.1.01 The annual state and federal tax returns are prepared by Outside Party
accordance with their annual tax engagement. The return is reviewed and approved by senior financial management prior to signing and filing.
Obtain tax returns and cover letter prepared by Outside Party :
1. Confirm that the return prepared by Outside Party was signed by senior financial management prior to filing.
Third party expert provides advice and prepares and files Federal and State returns.
KEY KEY
2.1.02 On a quarterly basis, a tax completion checklist is used and signed by thTax Manager and the Financial Controller.
Confirm that the quarterly tax completion checklist has been completed and signed by the Tax Manager and Financial Controller
Quarterly tax completion checklist used. KEY KEY
2.1.03 On an annual basis, the Tax Manager performs a "true up". Reconciling the tax returns as processed with the accounting records.
Review the annual True up journal entry and agree to supporting documentation and ensure it is appropriately authorized.
Annual reconciliation of tax return with accounting records.
KEY KEY
2.1.04 An off the shelf tax application package is used to complete tax calculations on an annual basis.
Retired 2008 KEY Rtd
2.1.05 On a annual basis, a tax completion checklist is used and signed by the Tax Manager and the Financial Controller.
Confirm that the annual tax completion checklist has been completed and signed by the Tax Manager and Financial Controller
Annual tax completion checklist used. KEY KEY
2.1.06 Parallel run of new FAS TRAC 109 and the prior Excel spreadsheets used for tax calculations, for the June Quarter
Retired 2008 Std Rtd
2.1.07 Tax Manager segregated from any GL input initiation or authorization. This test should be done in conjunction with testing of control # 1.4.04 since it uses the same test documents. Confirm that the Manager Tax does not have access to General Ledger for data entry
Tax Manager cannot approve or book an entry to G/L
KEY KEY
Describes activities required to accurately and completely calculate and records the tax provision and tax assets/liabilities in accordance with generally accepted accounting principles, SEC, federal, state and local tax regulations. This process includes the calculation of the tax liability for federal and state.
02 Taxes02.1 Taxes
Control Level
19
●Timing &●R-02.1.3
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02.1 Taxes PRA.xls 2/11/2009 1:03 PMPRA 2 of 2
