Case Studies
Risk-Based Audit
The Revenue Services Lesotho (RSL) decided to introduce an automated risk-based approach to their audit and compliance. Their existing system did not have such a module.
Paradox was used to:
Configure over 120 risk criteria combined in 6 risk sets.
Utilise the risk model to assess the risk posed by groups of taxpayers(e.g. large) and rank them.
Computerise standard audit workflows (e.g. VAT audit, Comprehensiveaudit, etc.) between the Audit Team Leader, Auditors and Taxpayers.
Configure 80 audit worksheets integrated to the workflows to facilitate the auditors’ work and documentation.
Report to management on progress.
Results Achieved:
Risk profile of the entire population of taxpayers automatically assessed and maintained
95% of taxpayers identified as high risk with a potential for additional revenues under VAT
Continuous (daily) referral of taxpayers to audit from the Risk Unit to the Audit Unit
Paradox integrated with the tax system – PSRM - to extract and refresh the data
Data Quality Management
Timor-Leste decided to conduct a nation-wide re-registration of all of its taxpayers because it began to be suspected that too many taxpayers had multiple TINs or had incomplete registration records. There had been more and more loss of national revenue, at times due to fiscal evasion.
The Paradox Box platform has been used to:
Identify duplicate taxpayers by de-duplicating the Tax database.
Cross-reference the Tax database with that of Customs to identify taxpayers under different identities in each system.
Cross-reference the Tax database with that of the Treasury’s vendors (taxpayers having a government contract) to associate the TINs to Vendors’ records.
Computerize the workflow between the front desk, the specialists, the data entry, and the managers
Report to management on progress.
Results Achieved:
40,000 TINs analyzed by The Paradox Box
16,000 TIN duplicates identified and cleansed
400 TINs were found active in ASYCUDA while inactive in the tax database
34,000 vendors in the Treasury’s database cross-referenced with the tax database’s TINs. TINs were associated to the corresponding vendors in the Treasury’s system to avoid payment if tax obligations were not encountered
8,000 taxpayers re-registered anew
New registration centre with 25 registration officers being using The Paradox Box
Interface of The Paradox Box with the One-Stop-Shop’s system to prevent new duplicates from appearing
