Evaluation of Internal Control over Financial Reporting Designed on Tax Receivable Management: A Case Study on Tax Receivable Management Cycle at the Directorate General of Taxes

摘要

The purposes of this research are to assess the adequacy of the control design and to propose improvements to Internal Control over Financial Reporting that can be utilized by the Directorate General of Taxes as a manager of tax receivable in support of transparency and accountability of the government financial statements. This research used a qualitative method with a case study approach to the Directorate General of Taxes as the unit analysis. The results show that the control design in the recording of tax receivable has not been fully effective. There are risks identified and gaps in the control which could lead to potential misstatements, whether overstatement or understatement of tax receivable. Weaknesses are also found in the tax receivable accounting policies that do not fully comply with the accrual principle, the issuance of Tax Letter and Tax Bill that still could be done manually, and the absence of data exchange portal between the Directorate General of Taxes and the Tax Court. To improve the condition, the researcher suggested the Directorate General of Taxes to revise the accounting policy of tax receivable, using the application from the determination to the settlement of receivable, and to develop the application with the Tax Court as the data exchange portal.