Neftaly Internal Audit: Customs Compliance in Holdings

Objective:
The internal audit for customs compliance aims to ensure that Neftaly Holdings and its subsidiaries adhere fully to international and local customs laws, regulations, and best practices. This audit safeguards the organization from legal, financial, and reputational risks associated with improper import/export processes and customs reporting.

Scope:

• All subsidiaries and business units engaged in international trade, import/export, and cross-border transactions.
• Review of customs documentation, declarations, and classification of goods.
• Evaluation of internal controls, risk management, and compliance procedures related to customs.
• Assessment of alignment with international standards, including WTO rules, Free Trade Agreements, and local regulatory requirements.

Key Audit Areas:

1. Documentation and Record-Keeping
   • Verification of import/export declarations, invoices, packing lists, and certificates of origin.
   • Examination of record retention practices to ensure compliance with statutory requirements.
   • Assessment of digital systems used for customs reporting and record management.
2. Tariff Classification and Valuation
   • Review of product classification under the Harmonized System (HS) codes.
   • Verification of declared customs values and assessment of potential under- or over-valuation.
   • Assessment of procedures for determining preferential tariff eligibility under trade agreements.
3. Duty, Tax, and Fee Compliance
   • Confirmation of correct calculation and timely payment of customs duties, VAT, excise, and other applicable fees.
   • Evaluation of internal controls to prevent misreporting or underpayment.
   • Examination of historical payments to identify potential liabilities or discrepancies.
4. Licenses, Permits, and Regulatory Approvals
   • Review of import/export licenses and permits for restricted or controlled goods.
   • Verification of adherence to sanctions, embargoes, and restricted-party screening procedures.
   • Assessment of compliance with hazardous materials, environmental, and trade-specific regulations.
5. Risk Management and Internal Controls
   • Evaluation of policies and procedures designed to mitigate customs compliance risks.
   • Review of employee training programs on customs regulations and responsibilities.
   • Assessment of periodic internal monitoring and self-assessment mechanisms.
6. Audit Reporting and Follow-Up
   • Identification and documentation of gaps, non-compliance issues, and control weaknesses.
   • Recommendations for corrective actions, process improvements, and enhanced compliance monitoring.
   • Follow-up procedures to ensure timely remediation of identified issues.

Outcome:
The internal audit provides management and the board with a comprehensive understanding of customs compliance risks, adherence to regulatory requirements, and areas for operational improvement. It supports Neftaly Holdings’ commitment to legal compliance, operational efficiency, and risk mitigation in international trade.

Conclusion:
Through rigorous internal auditing of customs compliance, Neftaly Holdings ensures transparency, accountability, and sustained alignment with international trade standards, ultimately protecting the company from financial penalties and reputational damage while facilitating efficient cross-border operations.