Australia: Changes to Top 1,000 combined assurance program
Taxpayers will be divided into two categories—significant taxpayers and general pool taxpayers.
The Australian Taxation Office (ATO) has announced changes to its combined assurance review (CAR) program’s Top 1,000 assurance program.
According to the ATO release (26 March 2024), the changes will:
- Recalibrate the metrics used to determine whether an economic group is in scope of the Top 1,000 to focus on the largest 1,000 taxpayers from the largest economic groups
- Differentiate its assurance approach and tailor its engagement regarding its understanding of those taxpayers from prior engagements and the assurance already attained
The recalibrated Top 1,000 metrics have identified the largest 1,000 entities from approximately 850 economic groups, which generally have a total business income of over $350 million.
Other factors for the Top 1,000 are also taken into consideration, such as the industry of a taxpayer, and whether any significant transactions or risks have come to the ATO’s attention that are best reviewed in a CAR.
Entities outside of the largest 1,000 entities will be considered by the ATO’s risk treatment approaches, including the “medium and emerging strategy,” and may be selected for a specific review of identified tax issues and risks.
As for its differentiated assurance approach, taxpayers will be divided into two categories—significant taxpayers and general pool taxpayers—with the assurance approach differing depending on the pool that the taxpayer is in and other factors such as their previous assurance rating.