Frequent changes in the tax legislation raise many questions from entrepreneurs. Tax disputes have become an integral part of many companies, and illegal actions of inspection authorities are the norm for business nowadays. No one is immune from participating in the proceedings. Taking into account the fact that the judge and the investigator do not have expertise in the field of accounting and tax accounting, they cannot objectively and impartially consider and make a decision. The forensic economical examination is required for a comprehensive and objective study of the range of issues that are the subject of taxpayer’s disputes. Conducting such examination requires a specialist to have not only legal knowledge but also understanding of the specifics of accounting, tax accounting and a company’s activity analysis. The specialists in the field of accounting and business analysis are invited as the experts. The court expert’s report is one of the types of evidence in all types of legal processes (civil, economic, criminal and administrative).
Economic examination is an examination of the documents of accounting, tax accounting and reporting, and aims to establish an actual reflection of economic transactions in a definite period. The subject of any economic examination is the actual data of the state of the case, to be established by means of special knowledge. To do this, the forensic and investigative authorities form the outstanding issues to be addressed to a judicial expert. The general concept of the subject of forensic economical examination is determined by knowledge of accounting and tax accounting for the settlement of questions arisen in the forensic and investigative practice.
Forensic economical examination shall be performed by an expert-economist with the special knowledge of economic sciences:
- Taxes and taxation
- Analysis of financial & economic activity.
- Principles of examination:
The main tasks of the examination of accounting documents, tax accounting and reporting are:
- To determine the documentary reasonability of the size of shortage or surplus of material and monetary assets, time and place of their occurrence
- To determine the documentary reasonability of transactions on receipt, storage, manufacture, sale of material assets, including monetary, fixed assets, provision of services
- To determine the documentary reasonability of funds and securities represented in accounting
- To determine the documentary reasonability of transactions on payroll calculation and distribution represented in accounting
- To establish the compliance of representation of income and expenses for business transactions in tax accounting, that are subject to income tax, with the current legislation
- To determine the compliance of representation of tax liabilities and tax credit for value-added tax in tax accounting with the current legislation.
The range of issues resolved during the examination:
- The expenses for a business trip are reimbursed reasonably (in what amount).
- The reduction of tax base for the period stated in the act of the State Taxation Administration(STA) and additional charges for payment of taxes and mandatory fees to the budget are confirmed by documents.
- The revenues (expenses) for the period determined and declared by a company are in accordance with the primary documents and the requirements of the Tax Code of Ukraine.
- The Company’s expenses for the period forming the cost of goods sold, work performed and services rendered are confirmed.
- The accrual of depreciation is confirmed documentarily and normatively in tax accounting of a company.
- The conclusions of the STA’s act on the claimed amount of VAT budget repayment for the period overstated by a company are confirmed.
- Whether the reasonable application of zero VAT rate on export operations under the contract is confirmed or not?
The examination involves a thorough research conducted by an expert on the basis of special knowledge of material objects which contains information about the state of the case of the preliminary investigation or trial. The court expert’s report is often the primary justification of the case, and an objective professional opinion of a specialist is the guarantee of a fair and legal court decision, as it is based only on the facts, documents, data appearing in accounting and tax accounting. The examination will be a reliable tool in your business protection arsenal.
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