" WHY A COMPANY SHOULD CONSIDER
OUTSOURCING A CUSTOMS COMPLIANCE AUDIT. "

US Customs Regulations Compliance Audits
Your importing people are probably as knowledgeable about US customs regulations as your finance people are about tax regulations. Annually, you bring in an outside accounting firm to perform an audit. This is not because your staff is incompetent, but because in finance, as in customs, it is prudent to have an outside expert analyze your systems and your work. You need an expert who can verify that you are complying with all US customs regulations. An expert that has extensive experience working with both companies like yours and US customs. An expert like International Tariff Management (ITM).

The passage of the 1993 Customs Modernization Act (Title VI of Public Law 103-182), shifts the legal responsibility for declaring value, classification and rate of duty applicable to entered merchandise to the importer. It requires importers to use reasonable care to assure US Customs is provided with accurate data.  Let us shoulder that responsibility.

WHAT IS AUDITED
A customs compliance audit involves the reviewing of written procedures, records and documents, as well as interviewing of personnel responsible for various activities that affect information submitted to the U.S. Customs Service. The objective is to determine if the information is sufficient to comply with the current customs regulations. Where a low or inadequate level of compliance is uncovered, written recommendations are made to bring it to an acceptable level.

The following areas are reviewed:

     1. Management Control Environment
     2. Reporting Structure
     3. Policy and Procedures
                    a. Classification
                    b. Quantity
                    c. Valuation

     1. Relationship between buyer and seller
     2. Currency conversion rate
     3. Non-dutiable charges
     4. Additional charges (e.g. assists)
                    d. Recordkeeping
                    e. Duty Free Entries
                    f. Special Areas

     1. Quotas
     2. FTZ / Bonded Warehouses
     3. Antidumping / Countervailing Duties
     4. Transshipments

FOCUSED ASSESSMENT
U.S. Customs officially implemented the Focused Assessment Program on October 31, 2001.  This program reviews the import-related controls that a business has in place to meet the legal customs regulations compliance requirements 

The customs compliance audit conducted by ITM will identify the "risk factors" your company has and suggest changes necessary to become compliant with the customs regulations.  This will allow you to preempt the actual focused assessment review by U.S. Customs and have in place, prior to their audit, a compliant internal control system.