Review into the ATO's use of compliance risk assessment tools – Released 21 February 2014
The purpose of this review was to assess the effectiveness of the ATO’s use of compliance risk assessment tools. The terms of reference stated that the review would focus on:
- the ATO’s approach to risk management
- the relationship between the ATO’s risk assessment process and compliance activities.
There are many risk assessment tools within the ATO’s enterprise risk management framework. These tools are used to gauge risks posed by taxpayers in each market segment. Overall, the Inspector-General of Taxation (IGT) found that stakeholders were generally supportive of the ATO’s use of risk assessment tools for risk identification and to improve the targeting of our compliance activities. Feedback suggested the ATO could improve their approaches. The recommendations made by the IGT relate to five broad themes:
- improving the understanding of, and confidence in, our risk approach (better communication with community and taxpayers)
- improving processes for risk categorisation, including more guidance for taxpayers and for ATO staff
- consulting with the community in relation to risk categorisation processes
- improving risk assessment processes and capability
- cost of compliance.