Education Industry Partnership Minutes - Meeting 13 - 16 October 2002

7. Compliance update - Walter Hadeed

Walter advised that a significant proportion of adjustments made within the sector are as a result of a lack of internal controls or human error. Common errors detected or voluntarily disclosed include incorrect apportionment of supplies where input taxed entities were involved, student accommodation, donations, sponsorships, mis-classification of courses, grants and appropriations, non-monetary consideration, FBT, transposition of figures and no activity statement reconciliation.

The university and TAFE sectors appear to have less problems than are apparent in the school and pre-school areas. A main cause identified is that the staff or individuals responsible for activity statement preparation have little or no accounting or tax awareness. They also appear to have little understanding of accounting software they are using and it is apparent from the compliance reviews that a significant number of staff at schools had not undertaken any further training in GST or activity statement matters.

Members were encouraged to ensure ongoing training is provided to cover staff turnover and give them a better understanding of their accounting packages, and to provide them with greater support for problem resolution. Having additional training and staff support in place is a positive step for schools when the issue of penalties for errors made is being considered by the Tax Office.

The individual state Tax Office compliance representatives could assist with more specific examples for use in identifying training requirements. It is understood that training of staff does vary from state to state and sector to sector, but each body should be taking a more positive approach to active compliance. Walter is prepared to pass requests onto appropriate state representatives. His contact details are: walter.hadeed@ato.gov.au.