New ANAO Report Gives Customs' Compliance A Tick

New ANAO Report Gives Customs' Compliance A Tick

While teething problems with its new Integrated Cargo Shipping (ICS) system may have wreaked havoc on the wharves last month, an audit report has given the Australian Customs Services' Customs Compliance Assurance Strategy (CCAS) a qualified tick.

Despite noting a range of data integrity problems and a lack of a national database system, the Australian National Audit Office report has found Customs has well-developed systems and processes for risk assessing and targeting cargo consignments.

Customs implemented its compliance improvement strategy for cargo reporting in the first half of 2003, after identifying a need to improve the timeliness of reporting. The strategy, which seeks to achieve timely, accurate reporting, involves determining the level of non-compliance by individuals and as well as the overall education of industry. CCAS is an intelligence-driven program designed to deliver an international trading environment by high levels of self-regulated compliance with government requirements. The strategy operates on several levels through assessment and analysis of the level and nature of industry compliance with statutory requirements.

It is intended to focus resources and activities on areas of risk, with a management and planning structure that is driven by intelligence and analysis. Specifically, the CCAS aims to provide the Government and the community with confidence that:

+ reporting of all cargo and vessels entering or leaving Australia is accurate and timely; + licence and permit requirements, prohibitions and restrictions in relation to imported and exported goods are complied with; + the correct amount of revenue is paid or identified for collection or consideration; + community protection programs related to imported and exported goods are effectively implemented; and + accurate and reliable data on trade statistics is provided to Customs.

The ANAO report concludes Australia's international trading environment is complex, involves multiple industry participants and is largely self-regulated.

"Customs adopts an appropriate risk management approach and has developed and implemented systems and processes to risk assess and target high-risk consignments and non-compliant behaviour. Customs also monitors and, where necessary, enforces compliance with legislative requirements through the compliance activities of the CCAS. These compliance activities are undertaken in a real time and post transaction context. Intervention strategies to address non-compliance are tailored to the nature and extent of the risk involved," it says.

On the other hand, the report found Customs' ability to target non-compliance is undermined by a lack of systematic analysis of risks and emerging trends. It also concludes the intelligence support being provided to the CCAS is also reduced by inadequate feedback mechanisms and information sharing. It suggests Customs intelligence capacity would be enhanced if compliance activities were evaluated and the results of these activities fed into intelligence assessments.

Meanwhile the report also highlighted significant data capture and data integrity problems. The audit determined a lack of readily available accurate and reliable compliance data and to evaluate the effectiveness of CCAS compliance activities or as a basis for management decision-making.

However it found Customs was putting in place a number of initiatives to strengthen its targeting and risk identification strategies.

"For example, the environmental risk analysis project is designed to identify and assess risks within the international cargo environment. Improved intelligence and information sharing arrangements are also being developed. Customs is working to address its data integrity issues so that it can properly evaluate compliance activities and provide assurance that the CCAS is meeting its objectives," it says.

The ANAO has made nine recommendations aimed at improving the operational and administrative effectiveness of the CCAS.

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