Tax Refunds and Phishing Fraud

“Dear Taxpayer,

You have been approved an income tax refund of Rs. 15,490/-, the amount will be credited to your account shortly. Please verify your account number 5XXXXXXX6755. If this is not correct, please update your bank account information by visiting the link below. https:// bit. Ly /3535wpyhalK87”

The above email is not from the FBR authority but it’s too late if you already clicked the provided link in the email and provided your true personal and financial information.

In the uproar and fear of taxes and accountability by Federal Board of Revenue (FBR) on the non-filling of returns, keeping benami assets (doing benami transactions) and tax evasions. Phishers are active in tricking and trapping tax payers and fillers. Although emails and mobile messages for notices, penalties and tax refunds scams are not new, it is trapping taxpayers since FBR has eased the return filling procedure and launched IRIS portal. It’s amplitude in the last two months has increased and many tax payers fallen in this trap. These emails request your personal and financial information by luring you in the name of tax refunds or scaring you by possible imposition of tax penalty.

IRIS Inbox First of all, ‘’Never expect a tax refund message by FBR, FBR hasn’t and till date has no SOP to communicate tax refunds by mobile messages or emails”. Now coming on the emails, FBR do send emails registered for your accounts on IRIS portal and just communicate if you have received any notice in the inbox of your IRIS account, just to be sure that taxpayer is notified that he has received a notice from FBR, even full text is not shared on email and taxpayer must view his inbox on IRIS portal to read what is about.

Phishing is not new, remember “Jeeto Pakistan WhatsApp messages” of congratulating recipient for winning gold just to obtain recipient personal and banking information and login credentials. It is very important for recipients of such messages and email, without getting excited or panic just verify such messages from the authority or organization it is mentioning.

Tips for identifying and avoiding being preyed of phisher and phishing emails.

Number and Email address
- Phishing emails and messages do not have proper or inconsistent email address. Albeit they keep email address to imitate original organization but if they are keenly observed then one can identify them.
They will not specifically address you
- Instead they will use general greetings and will address with “Dear Taxpayers”, “Dear Sir/Ma’am” or “Dear Recipient”.
Compare the email address with the actual website domain of the organization.
- Remember FBR has domain of “fbr.gov.pk” and FBR do not use any other address.
Never click on any link provided in the Email
- FBR will never ask you to click any link neither will ask you to provide your login credentials of any account whether it be IRIS or you bank account.
Consult an advisor or consultant
- They have awareness of the changes and recent developments in the industry.

What you should do once you are sure that it’s a trap?

Report it, report it to the authority and report it to Google so that these traps can be removed from the online web.

Report to Google through following link:

https://safebrowsing.google.com/safebrowsing/report_phish/?hl=en

Report it to National Response Center for Cyber Crime through following link:

http://www.nr3c.gov.pk/creport.php

Or at least forwards that email to FBR on:

sec.website@fbr.gov.pk

FBR already took serious action against these email frauds and trying to aware people through press releases.

Some phishing email samples that FBR issued in relation to this fraud are below kindly be safe and aware your friends and family.

For any business/tax consultation you can write to me through contact me.

Corporate Governance

“Corporate governance is a mechanism, system and relations by which companies are directed, administered and control.”

Following the collapse of major companies such as Enron, worldcom and other big financial scandals during 1980s and 1990s in which accounting frauds were largely involved has shaken the confidence of investors. Corporate governance is of paramount importance to a company, it’s adoption mitigate the chances of financial frauds and big corporate scandals and can maintain investor’s confidence.

It is not a law

Corporate governance is not a law, but are set of principles which can direct companies in their affairs in a more transparent way. There is a misconception about corporate governance that it is some kind of law, instead it is a principle base approach to direct companies and not a law which is a rule base approach to regulate society or an entity.

Objective of Corporate Governance

The main objective of corporate governance is to maintain and enhance the confidence of the shareholders. It helps the decision making at the strategic level of the company, it segregate the duties and power and provide the base to main integrity. It explain to the board of directors (both executive and non-executive), management and shareholders their rights and duties and in particular, a role in running a company.

Content of Corporate Governance

Risk Management
Internal control
Fairness
Openness and transparency
Independence
Integrity
Accountability

Why it is so important

Shareholders or investors has a level of confidence connected with the management of a company. They have entrusted management with their wealth, to maintain their confidence corporate governance plays a vital role. Nowadays investors consider the corporate governance as a big factor to investment decisions. It maintains investor’s confidence which can help to raise finance for further growth of a company. It can be said the good corporate governance can speed up the process of growth in a company.

Introduction to Audit

Companies are of two types public listed companies and private companies. Public listed companies means companies owned by government and private companies are those that are owned by individual or group of people, family or related people. Sole trader, partnership and limited liability companies (Ltd) are types of private (pvt) business/companies. Audit necessity, importance and meaning can be understood by looking at the structure of the companies. Companies are financed by financiers (shareholders) but are run by directors/management meaning director and shareholder has a relationship due to which directors are able to use the wealth of shareholders and to act on their behalf this relationship is known as agency (i.e directors acts as agents of shareholder). As the wealth of shareholders is now control and authorised to used by directors of the company therefore they (directors) also play the role of steward, who has the responsibility to protect and safeguard the wealth of shareholders as well, this concept is known own as stewardship. Because, the company is run by directors/management other than shareholders and directors (i.e agents & stewards) are given complete autonomy (authority) so, it is highly unlike that they will trust the financial statements prepared by agents and stewards (It is like asking the performer, how you performed or asking the caretaker, were you successful in taking care of the possessions). So, in order to verify they will appoint an independent, honest and recognised person having a command on subject matter (financial statements) to give them assurance that the financial statements prepared are not false. The person who will be appointed to perform the above mention task and to give assurance to shareholders (stakeholders in broad) is known as auditor and the task is called as audit.

Audit can be define as,

Audit is an independent examination (not preparation) of financial statement which enables auditor to express an opinion (only assurance and not a guarantee) on whether the financial statements are prepared in all material respects, in accordance with an applicable financial reporting framework and whether they presents true and fair view.