Tax audits are conducted when the ATO deems that a more extensive examination of an issue is necessary. These audits can be conducted on a fairly basic level or they can be much more in-depth and analytical.
In most cases, there will be a review which then leads to an audit, but this isn’t always necessary. A review may not be deemed necessary in cases where fraud or evasion is suspected or there is a high risk associated with the transaction.
The ATO states that they will be transparent about the following aspects of an Audit:
Scope, periods under audit and expected completion date
ATO’s risk hypothesis and information required to assess the hypothesis
Choice of channel to provide information to ATO
How audit will be conducted (key milestones and relevant guidelines)
Advantages of, and procedures for, making voluntary disclosures
Expectations from individuals/businesses when information has been requested for records
Circumstances in which ATO can be expected to use their formal powers
Cooperating with the ATO’s requests is the ideal response. If there is a lack of cooperation, then the ATO can use their formal powers to access the information they are seeking:
Notice powers: Require you to give information, attend and give evidence or produce documents
Access powers: Give free access to the ATO to all places, books and documents and require that assistance be given to ATO’s officers to exercise their powers.
Cooperation makes this process much easier for both parties as a lack of cooperation can not only create a bad image but can be easily overcome by the ATO’s powers.
Strategic planning for businesses ensures resilience and continuity in adversity.
While businesses often focus on growth and expansion, preparing for potential disruptions and emergencies that could threaten operations is equally essential.
This is where disaster management, crisis, and continuity plans come into play.
Disaster Management Plans
Disasters can strike without warning, ranging from natural calamities like floods, earthquakes, and hurricanes to human-made incidents such as cyberattacks, data breaches, or supply chain disruptions.
Disaster management plans outline strategies and protocols for responding to and recovering from such events swiftly and effectively. These plans typically include measures for ensuring employee safety, protecting critical assets and infrastructure, and minimising downtime.
By having a comprehensive disaster management plan, businesses can mitigate the impact of disasters and expedite the recovery process.
Crisis Management Plans
While disasters are often external events beyond a business’s control, crises can arise from internal factors such as leadership failures, product recalls, or reputational issues.
Crisis management plans are designed to address these unexpected challenges and mitigate their impact on the organisation’s reputation, brand equity, and bottom line. These plans outline communication strategies, escalation procedures, and decision-making frameworks for managing crises promptly and transparently. By proactively addressing crises and demonstrating resilience, businesses can preserve stakeholder trust and emerge stronger from adversity.
Business Continuity Plans
Business continuity plans focus on maintaining essential functions and operations during and after disruptive events to ensure minimal disruption to business operations.
These plans identify critical processes, resources, dependencies, and alternative strategies for sustaining operations during a crisis or disaster.
Business continuity plans encompass remote work arrangements, data backup and recovery procedures, and alternative supply chain routes.
By prioritising continuity and preparedness, businesses can reduce downtime, protect revenue streams, and uphold their commitments to customers and stakeholders.
Benefits of Comprehensive Planning
Risk Mitigation: By anticipating potential threats and developing proactive strategies, businesses can mitigate the impact of disruptions and minimise associated risks.
Resilience and Adaptability: Comprehensive planning fosters organisational resilience, enabling businesses to adapt and respond effectively to changing circumstances and emerging challenges.
Stakeholder Confidence: Demonstrating preparedness and responsiveness instils confidence in customers, employees, investors, and other stakeholders, strengthening relationships and fostering loyalty.
Regulatory Compliance: Many industries have regulatory requirements mandating development and implementation of disaster management, crisis, and continuity plans. Compliance with these standards is essential for avoiding penalties and legal liabilities.
Competitive Advantage: Businesses prioritising resilience and preparedness gain a competitive edge by differentiating themselves as reliable partners and service providers.
Disaster management, crisis, and continuity plans are integral components of strategic planning for businesses seeking to enhance resilience and ensure continuity in the face of adversity.
By investing in comprehensive planning, businesses can mitigate risks, maintain essential operations, and safeguard their reputation and bottom line.
In today’s volatile and uncertain business environment, proactive preparedness is not just a best practice but a strategic imperative for long-term success and sustainability. Need assistance with strategic planning as we approach the end of the financial year? Speak to one of our trusted business advisors.