Amending Certain Provisions of Revenue Memorandum Order (RMO) No. 25-94 Prescribing the Use of BIR Form 1717 Series (Revenue Officer's Audit Report), Providing the Necessary Guidelines and Instructions for Their Use and Processing of BIR Forms 1717/0500 Series

February 20, 1997 REVENUE MEMORANDUM ORDER NO. 08-97 SUBJECT : Amending Certain Provisions of Revenue Memorandum Order (RMO) No. 25-94 Prescribing the Use of BIR Form 1717 Series (Revenue Officer's Audit Report), Providing the Necessary Guidelines and Instructions for Their Use and Processing of BIR Forms 1717/0500 Series TO : All Revenue Officers and Officials Concerned I. OBJECTIVES 1. To provide for more detailed guidelines in the accomplishment and submission of Revenue Officer's Audit Report, BIR Form 1717 Series for Non-ITS Revenue District Offices (RDOs) and Forms 0500 Series for ITS RDOs. 2. To ensure proper accomplishment of BIR Forms 1717/0500. 3. To reflect usage of Third Party Information in the investigation/assessment of deficiency taxes in the BIR Form 1717/0500 Series Reports. 4. To facilitate processing of date for management information purposes. II. GUIDELINES AND PROCEDURES A. Paragraphs 1 and 2, Sec. II of RMO No. 25-94 are hereby amended to read as follows: 1. Revenue Officers shall complete the required form in duplicate. The accomplished forms shall be attached to the docket when the case is submitted by the Revenue District Office (RDO) to the Revenue Regional Assessment Division. The duplicate BIR Forms 1717/0500 shall upon receipt of the dockets, be detached and batched by the Assessment Division and submitted every Monday directly to the Audit Data Bank Division, Assessment Service at the National Office. 2. If changes are made to the Audit Report upon reinvestigation or review, a new BIR Form 1717/0500 shall be completed by the Revenue District Office or the Assessment Division, as the case may be. The new BIR Form 1717/0500 shall expressly indicate on its face whether or not the changes were made as a result of a reinvestigation by the RDO or as a result of the review findings by the Assessment Division. In case of the latter, a copy of the old BIR Form 1717/0500 report as accomplished by the RDO shall be attached to the BIR Form 1717/0500 prepared by the Assessment Division The BIR Form 1717/0500 shall prominently bear the word "REVISED" on the right hand corner of the form. LLphil The new BIR Form 1717/0500 shall be forwarded to the Audit Data Bank Division as indicated in item 1 above. B. Sec. II of RMO No. 25-94 is hereby amended by adding new paragraphs thereto: 12. Reports that were returned to the originating office for correction and/or completion must be acted upon and sent back to the Audit Data Bank Division within seven (7) days from receipt thereof by the concerned office. 13. In the preparation of BIR Form 1717/0500, the Revenue Officers must observe the following guidelines: a. All blanks in the BIR Form 1717/0500 must be clearly and accurately filled-up. Omissions and/or incorrect accomplishment of any portion of BIR Form 1717/0500, including any erroneous computation, shall result in the return of the same to the originating office. b. The term Industry/Profession Code refers to the Philippine Standard Industrial Classification (PSIC) Code (Annex. "A") set the National Economic and Development Authority (NEDA). c. Cases not covered by Letters of Authority (LAs) must cite the reasons for the conduct of the audit in the boxes allotted for LA No. and date of LA. d. The box, "Total Assets of the Business as of the End of the Period," refers to the adjusted figure of the assets. e. No. of hours to complete audit is the actual time spent in auditing the return. A summary of the actual log may be attached to the report. f. Case classification refers to the classification after the completion of audit. g. The Selection Code must be added as a footnote to the bottom left hand corner of the report to facilitate the monitoring of the compliance by individual RDOs to their Annual Audit Program. 14. Group Supervisors of the Revenue Officers conducting audit shall: a. Exercise extra care before affixing any initial and/or signature on the BIR Form 1717/0500 Series reports. b. Exert extra effort in checking the computations done by the Revenue Officers. c. Encircle the time reported to note that a thorough review was made and the actual time consumed by the Revenue Officer was commensurate to the requirements complied while handling the case. d. Note use of Third Party Information by scoring the figures involved by signing the notation. cdpr e. See to it that the date the report was actually submitted should tally with the date of the narrative report submitted by the Revenue Officer. 15. Unless the BIR Form 1717/0500 and the other requirements on report making as prescribed in the approved Handbook on Audit Procedures and Techniques are attached to the docket of the case, no Authority to Accept Payment (ATAP) shall be signed by the Revenue District Officer of non-ITS RDOs and no Payment Form shall be issued to the taxpayer by the Revenue District Officer of ITS RDOs. III. PROCESSING of BIR Forms 1717/0500 in the NATIONAL OFFICE A. The Audit Data Bank Division (ADBD), Assessment Service shall perform the following: a. Receive the clear duplicate copies of the BIR Form 1717/0500 Series reports every Monday from the Assessment Division endorsed either by the Assistant Regional Director or Regional Director. b. Review the completeness and accuracy of the documents received. BIR Form 1717/0500 that do not comply with the requirements of RMO No. 25-94 will be returned to the originating office for correction. c. Notice of the returned BIR Forms 1717/0500 will be provided to the Regional Director Concerned and the Performance Monitoring Service at the National Office. d. Batch the reviewed forms into 100 or less by form type and by tax year per RDO and Assessment Division. e. Forward the batched BIR Forms 1717/0500 to Information Systems Operations Service. B. The Document Processing Division (DPD), Information Systems Operations Service (ISOS) shall perform the following: a. Receive/screen batches of BIR Forms 1717/0500. Incompletely filled-up forms should be returned to ADBD. b. Transcribe information into BIR Form 1717/0500 data entry sheets. c. Transmit data entry sheets to Network Systems Operations Division (NSOD) C. The Network Systems Operations Division (NSOD), ISOS shall perform the following: a. Encode information on BIR Form 1717/0500 data entry sheets. b. Generate outputs in diskettes. c. Transmit output diskettes to DPD for release to ADBD. IV. REPEALING CLAUSE The provisions of RMO No. 25-94, RAO No. 5-95 and all other revenue issuances and/or provisions thereof inconsistent herewith are hereby modified and/or repealed accordingly. dctai V. EFFECTIVITY This Order takes effect immediately. LIWAYWAY VINZONS-CHATO Commissioner