Risk Analysis/Screening

Screening is a form of classification or filtering of declarations (for example tax returns, import/export declarations, or any other form of structured information such as claims for subsidies and exemptions) submitted to the revenue authority. Screening can be performed either solely on the basis of the information in the declaration (which, in ESKORT terminology, is referred to as the analysis object) or on the basis of all supplementary information about the taxpayer or trader than can be associated with the declaration or tax return, and which might have relevance for the analysis of the declaration.

The objective of a screening system is essentially to classify incoming declarations/returns into two or more categories dependent on what kind of processing action needs to be taken in relation of the declaration.

In the context of VAT or tax returns, the simplest example involves classification into two categories - one comprising those returns requiring manual intervention before the assessment can be finalised (i.e. where the returns exhibit a tendency to be incorrect) and the other comprising those that can be finalised directly (i.e. where there is a low risk that the returns are incorrect). For those tax returns which require manual intervention, the system can provide indications (observations) as to the extent of the error and what corrective action should be taken before the raising of an assessment is possible.

In the context of Customs, screening is generally a "real-time" process where declarations (e.g. import/export declarations) are received directly on input to the production system (i.e. the clearance system) and are then analysed and classified into a number of categories – most typically a high risk category (should be inspected), a low risk category (can be released immediately) and a medium category (a customs officer must decide if an inspection is required).
The screening system returns the analysis results and supporting information (classification category and supporting observations from the analysis) to the production system (the clearance system, the tax processing system etc., as the case may be) which then directs the subsequent flow of processing, based on these results.

Benefits

The key benefits of the ESKORT Risk Analysis/Screening System include:

  • It can be configured for use in a wide variety of different risk analysis situations;
  • It can be used in real-time mode facilitiating decision making in complex, time-critical situations;
  • It increases efficiency and efficacy of subsequent actions by only allocating resources to high potential risk areas and ensuring that these resources have the necessary information for their actions;
  • It requires limited training to use and no specialist IT knowledge or programming skills to operate and maintain (reconfigure the knowledge content of) the system;
  • It offers extreme flexibility in terms of ease of modifying the risk criteria which form the basis of the risk analysis (which allows the system to be responsive to a rapidly changing business environment);
  • It is far more powerful than normal financial score-carding techniques and systems, in terms of the complexity of the risk model that can be developed – essentially it allows for any level of sophistication to be built into the risk rules, both in terms of the ability to model extremely complex, multi-dimensional data environments (which include such diverse information as returns history for the relevant trader or taxpayer, data from other tax areas, tome series data, payment information and even third party information) and in terms of the capability of developing multi-dimensional risk models that enable risk to be considered from a number of different view points.

ESKORT Customs Clearance Risk Analysis
ESKORT Customs Clearance Risk Analysis 855 KB