The majority of senior accounting officers (SAOs) stated that they were still unsure as to the nature of issues to be reported within the SAO certificate, according to a recent survey by Protiviti. In response to this uncertainty, Protiviti have created a short FAQ to support the SAO in providing an adequate certificate to HMRC. The deadline for filing of the SAO Certificates is 30 September 2011.
Who Should be Submitting the Certificate?
The SOA of a qualifying company is responsible for providing HMRC with a certificate. Companies subject to Schedule 46 have to notify HMRC of the name of the person(s) acting as SAO for each financial year. Notification will normally be made to the customer relationship manager (CRM) and should be filed within the period under Companies House requirements.
When to Submit the Certificate?
The certificate should be provided to the CRM for the company or companies covered and must be submitted no later than the end of the period for filing the accounts for the financial year. To ensure that no notification or filing dates are inadvertently missed, it is recommended that the SAO discusses a potential extension with the CRM in advance.
The Format of the Certificate
The HMRC guidance provides a suggested format and wording for the certificate, as follows:
“I… as Senior Accounting Officer of the qualifying company/companies listed below, hereby certify that to the best of my knowledge and belief throughout the company’s or companies’ financial year ended […] the company/companies had appropriate tax accounting arrangements or to the extent it/they did not, an explanation is provided below.”
What to Disclose
There are three main issues that should be disclosed within the certificate:
- Weaknesses or deficiencies within the current control framework that are likely to result in material inaccuracies being reported to HMRC. These weaknesses have not yet been resolved and therefore the SAO has not been able to identify adequate compensating control to mitigate the risk.
- Weaknesses or deficiencies within the current control framework that are likely to result in material inaccuracies being reported to HMRC for which adequate compensating controls have been identified.
- Weakness or deficiencies identified throughout the year: – In addition the SOA should prepare a list of weaknesses or deficiencies that are not deemed to be material and for which adequate ‘compensating controls’ or remediation plans are in place to prevent an error. This list should not form part of the certificate but ought to be discussed with the CRM.
Review of the Certificate by the CRM
The SAO certificate will form part of the overall information that will be used by HMRC to risk assess a business. The content of the certificate will help the CRM to focus corporate compliance activity. HMRC does not foresee the CRM specifically undertaking work to verify the accuracy of the certificate. It is therefore not envisaged that the CRM will undertake an in-depth audit review in order to cover all taxes in scope. Typically the CRM’s will build up an understanding of the systems and governance through real time discussions with the business and normal risk-based compliance checks.
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