202. SOLUTIONS FOR DEVELOPING TAX CONSULTANCY SERVICES FOR TRADING BUSINESS ENTERPRISES AT AAGROUP CONSULTANT AUDIT COMPANY LIMITED

LIST OF TABLES AND FIGURETable 2.1 The number of customers doing audit - Accounting - Consulting services at AAGROUP Consulting Auditing Company Limited increased over the years 47 Tab

MINISTRY OF FINANCE ACADEMY OF FINANCE

 Khuất Duy Lộc Grade: CQ54/02.02GRADUATION THESIS

First of all, I would like to express my profound gratitude to mysupervisor Assoc Prof Phd Vuong Thi Thu Hien who has continuously helpedand encouraged me to develop the understanding of the subject I could notcomplete my graduation thesis without his enthusiastic instructions, advice andcorrection From bottom of my heart, I honestly wish him the best heath and hishappiness in her life

Besides, I truly appreciate the internship opportunity at the AAGROUPAuditing Consulting Co., Ltd They gave me a chance to corporate at work and togain more not only knowledge but also experience

Last but not least, I wish to express my gratitude toward my belovedparents for their passionate love and whole hearted cultivation throughout myschool life Sincerely thank!

CATEGORY

LIST OF ABBREVIATIONS

VAT : added value tax

PIT : personal income tax

CIT : corporate income tax

AFTA : ASEAN Free Trade Area

ASEAN : Association of Southeast Asian Nations

GDVC : General Department of Vietnam Customs

ICT : Information and Communication Technology

IT : Information Technology

RKC : Revised Kyoto Convention

NICIS : Nigeria Integrated Customs System

NCS : Nigeria Customs System

DTI : Direct Trader Input

WCO : World Customs Organization

OIIL : The Office of Intelligence and Investigative Liaison CBP : US Customs and Border Protection

LIST OF TABLES AND FIGURE

Table 2.1 The number of customers doing audit - Accounting - Consulting

services at AAGROUP Consulting Auditing Company Limited

increased over the years

47

Table 2.2 Operating revenue of AAGROUP Auditing Consulting Company

Table 2.3 Performance of tax obligations of AAGROUP Auditing and

Consulting Co., Ltd for the period of 2016 - 2019 49Table 2.4 Summary table of the number of commercial businesses doing

tax advisory services at AAGROUP Auditing and Consulting

Co., Ltd for the period of 2016-2019

52

Table 2.6 Revenue from tax advisory services for commercial enterprises

Table 2.7 Revenue of tax advisory services for commercial businesses at

AAGROUP Auditing and Consulting Co., Ltd during 2016-2019 69Table 2.8 Turnover for each type of advisory service for commercial

enterprises at AAGROUP Auditing and Consulting Co., Ltd.

during the period of 2016-2019

Figure of percentage of revenue structure of each service type for

enterprises in the manufacturing sector in 2019 73

INTRODUCTION

1 The necessity of the thesis

Facing the current development of the market economy, in addition toforeign-invested enterprises like before, more and more Vietnamese companies

such as joint stock companies as well as groups of large companies are involvedwishing to use the Tax Consulting service In addition, there has been a boom indemand for assistance and guidance on tax-related procedures (from businessregistration procedures, tax registration procedures, invoice purchase, taxdeclaration and finalization) of private businesses, business owners, independentpractitioners because most of these companies lack experience or do notarrange staff and build Accounting - Tax division right in the company Thaturgent need led to the birth of a series of tax Consulting companies in ourcountry After more than 10 years of the establishment and development of theVietnam Tax Advisory Council, tax advisory services have become popular andplay an important role in the country's socio-economic development Performing

a good role as a bridge between businesses and tax authorities, businessorganizations providing tax consultancy services are increasing in both quantityand quality Along with the strong process of international economic integration,the tax consultancy service has been joined by foreign organizations andenterprises, signaling a strong competition in the specialized service market Thisbusiness with domestic enterprises in the near future

Currently, Tax Consulting is a very large array of services that businessesoperating in the fields of finance, accounting and auditing are interested in.Large audit firms often have a strong Tax Consulting division and annuallyrecruit a large number of fresh graduates from the finance, accounting and taxindustries With the increasing recruitment demand in the field of TaxConsulting, students will have many job opportunities after graduation such asworking at big 4 or working at about 300 auditing companies - Other TaxConsultants in Vietnam Male So what needs to be done to capture this potential

audience, create their competitive advantage and contribute to the development

of domestic tax consultancy? Therefore, through the process of learning and

practicing students select the topic " SOLUTIONS FOR DEVELOPMENT OF TAX CONSULTANCY SERVICES FOR TRADING BUSINESS ENTERPRISES AT AAGROUP CONSULTING AUDITING CO., LTD" as the

topic graduating

2 Overview of research projects related to the dissertation topic

In the world, there have been many researches on tax advisory services atenterprises as well as issues related to tax inspection and examination that taxauthorities are always interested in enterprises, such as: :

From January to March 2015, International Tax Review conducted a

field survey in several countries in South America about " How tax services are changing" The purpose of this survey is to find out the change and strong

development of Tax services in general in South American countries Thanks tothis survey, researchers at the International Tax Review have found adevelopment direction for tax services and drew a perfect picture for long-termdevelopment, a development strategy Tax services in the future

European Commission (EC) (2010), Guidance on managing compliance

risk in tax administration (original in English: Compliance risk management guide for tax administration) This document introduces the theoretical

framework of the compliance risk management model in tax administration withbasic issues such as: the taxpayer's compliance risk management environment;The basics of risk management processes such as risk identification, risk

analysis, risk assessment and risk handling In particular, this document hasintroduced the experience of applying management risk management in taxadministration and tax inspections in over 20 countries around the world withthorough descriptions of how to apply, achieved results and key issues drawnfrom real cases see off.

Muwer Sultan Khwaja, Rajul Awasthi and Jan Loeprick (2011),

Inspection on the basis of risk management: Approaches and experiences of some countries (English original: risk-based audit: Approaches and countries experiences The book provides a quite comprehensive and comprehensive

theoretical framework on application of risk management techniques in taxinspection, from basic concepts to analysis techniques, specific contents andprocesses To apply risk management to tax inspection activities, the mostimportant things drawn from the book are useful for studying the application ofrisk management in tax inspection activities: (i) To improve the efficiency ofapplication of risk management techniques, the information about taxpayers isthe most important factor to get information The information must be based oninformation from third parties on the basis of assessing the conformity with thetaxpayer's reliable declaration database; (ii) The tax inspection must be based onrisk analysis is new to high efficiency; (iii) To apply risk management ineffective tax inspection, it is necessary to standardize standards and requirementsfor enterprise accounting; (iv) It is necessary to create a comprehensive legalcorridor to uniformly apply tax inspection processes and procedures; (v) Ensuretimely, complete and accurate information for tax administration decisions andtax policy finalization

In Vietnam today, in the context of the trend of globalization ofinternational integration, our country participates in many international tradeorganizations, there are a lot of doctoral and master thesis, yearbooks, magazinesrelated to tax consultancy services in general and tax consultancy services atenterprises in particular, which are posted on the websites of GeneralDepartment of Taxation, financial magazines may include: Research paper:

"

Developing private tax services in Vietnam" by Master Nguyen Cam Tam,

Financial Academy Article published on Finance magazine No 12/2012

The seminar " Development of electronic tax services and electronic customs services in Vietnam", held on November 8, organized by the Department

of Tax and Customs (Academy of Finance), was published in the FinancialTimes of November / 2019

Doctoral thesis: " Developing tax services in Vietnam in the current period"

by Master Nguyen Cam Tam, Academy of Finance, conducted in 2013

Master's thesis: “Studying factors affecting enterprises' satisfaction on

the quality of propaganda services to support taxpayers at the Thu Duc District Tax Department HCM” by PhD student Luong Ngoc Long in 2016.

Document: " Tax consulting services at Deloitte Vietnam Co., Ltd." by

Deloitte Vietnam Co., Ltd implemented in 2010

The doctoral, master, scientific and research theses, articles in financialjournals have provided theoretical basis for knowledge of tax advisory services

in enterprises, thereby providing directions for developing tax consultingservices at commercial enterprises, perfecting tools to ensure healthy

competition in accordance with commitments and protection policies ofcountries based on agreements of international trade organizations (WTO).However, there has not been any in-depth study of specific tax advisory services

in commercial enterprises in Vietnam The selection of graduate thesis topic isnot completely overlapping with published research works

3 Research objectives of the thesis

- Clarify the role of tax consultants for businesses today

- Systematize and clarify some theoretical issues about tax consultancyand tax advisory services for commercial enterprises

- Analysis, evaluation of advantages and limitations of tax advisoryservices in the field of commercial business at Auditing Consulting Co., Ltd.AAGROUP

- Provide appropriate solutions and recommendations to develop taxadvisory services in the field of commercial business at AAGROUP ConsultingAuditing Co., Ltd

4 Research subject and scope of the thesis

- The object of the study is tax consultancy activities for companies in thefield of commercial business at AAGROUP Auditing Consulting Co., Ltd

- The scope of the research is tax advisory activities for companies in thefield of commercial business at AAGROUP Consulting Auditing Co., Ltd in theperiod of 2016-2019.

5 Research method of the thesis

Applying dialectical materialism, historical materialism combined with themethod of synthesis, analysis, comparison and illustration

6 The structure of the thesis

Chapter 1: Overview of tax consultancy and tax advisory services for

commercial businesses

Chapter 2: Actual situation of consulting services for commercial

businesses at AAGROUP Auditing Consulting Co., Ltd

Chapter 3: Solutions to develop tax advisory services for commercial

businesses at AAGROUP Auditing Consulting Co., Ltd

CHAPTER 1 OVERVIEW OF TAX ADVISION AND TAX CONSULTANCY SERVICES FOR COMMERCIAL ENTERPRISES

1.1 Tax advisory service

1.1.1 The concept of tax consulting and tax advisory services

a) Definition of tax consultancy and consultancy

Consulting concept and consulting profession

According to the Vietnamese dictionary, "Consultation is to give opinionsabout the questions that are asked but there is no right to decide" (Vietnamesedictionary - Institute of Linguistics, Da Nang Publishing House)

"Counseling" in the original sense is handling questions The word

"consult" here means processing, while the word "Query" means the question InEnglish people use the word Consultancy to refer to the consultation.Consultancy is formed from the Latin word "Consultus", which means "Legalexpert", a narrower meaning than the modern Consultancy The term

"Consultancy" can mean a lot of things, bringing together the main idea of giving business advice [1]

Consulting profession

Advice is everywhere In work and life, everyone needs counseling to helpfind solutions to a difficult problem Because consulting is everywhere, it isdifficult to become a profession, a professional service in society

Consulting is a service industry that does not have a fixed definition Themarket for this service is also very flexible Consulting services are activities inwhich professionals conduct selective and provide information, knowledge,solutions or action plans to help clients make the right decision Consulting is

divided into several types: management consultancy, commercial consultancy,legal advice, technical advice - technology, policy advice, etc In each specificcase, the consultant usually has to perform many roles: role of information andknowledge guarantor; management assistant role (such as planning, helpingcontrol over a project); role of research facilitator (survey, collecting, processinginformation, helping to propose solutions ); role of suggestive, objective critic;additional trainers' role, helping to improve skills; the role of mediator incooperative relationships, partnerships, joint ventures, etc.

b) Definition of tax advisory and tax advisory service

Taxes consultant

Tax consultancy is a tax-related consultancy activity for businesses(customers); solve problems and issues related to taxes and give opinions onfeasible measures and help customers comply with and comply with current taxregulations An industry that requires specialized tax knowledge but a taxconsultant is not necessarily a tax officer A tax advisor can be a legal expert or afinancial expert with experience in tax and other socio-economic matters.Customers' tax issues are sometimes related not only to tax laws but also to manyother laws such as corporate law, commercial law, economic contractordinances, even civil law, It is the content not responsible tax advice Thisrequires a broad understanding in many aspects of the consultant, can beconsidered quite difficult That is why professional tax advisors will advise oneach tax segment, which will help them to be able to gain more focusedknowledge of the tax issues they have advisory [1]

Tax advisory service

Tax advisory services are services that companies provide customers with

a wide range of issues including tax policy advice, procedures for initial taxfiling, advice on tax reporting and settlement tax At the same time supportcompliance with value-added tax, corporate income, personal income, Regularly update the latest changes of tax policies and advise customers onsolutions effective in organizing activities, giving warnings as soon as possibleand helping to cope with risks

1.1.2 Subjects of tax consultancy

Tax advisors are taxpayers who may be an individual or an organizationhaving difficulties and difficulties in need of advice on a certain field related totax law

Tax advisors with knowledge and in-depth understanding of their tax lawswill provide the most professional advice and solutions to their tax issues Theyprovide the right direction and explanation of tax laws so that taxpayers can usethem most effectively, minimize the amount of tax payable and ensurecompliance with the law Specialists will review all aspects of taxation to ensureproviding the best tax strategy for the customer's future financial activities aswell as performing tax obligations on behalf of the customer country

An industry that requires specialized tax knowledge but a tax consultant isnot necessarily a tax officer A tax advisor can be a legal expert or a financialexpert with experience in tax and other socio-economic matters Customers' taxissues are sometimes related not only to tax laws but also to many other laws

such as corporate law, commercial law, economic contract ordinances, even civillaw, The is the content not responsible tax advice This requires a broadunderstanding in many aspects of the consultant, can be considered quitedifficult That is why professional tax advisors will advise on each tax segment,which will help them to be able to gain more focused knowledge of the taxissues they have advisory In developed countries, professional tax consultancy

is a profession that requires certification and is strictly regulated by the law onterms of practice, working principles as well as customer responsibilities It isalso a model that Vietnam looks forward to in the future

1.1.3 The role of tax advisory services in the market economy

a) The role of tax advisory services in tax administration

Through tax consultancy activities, tax advisory services have contributed

to strengthening the tax administration, in particular:

Firstly, the tax consulting company is a channel to provide information to

tax authorities about tax problems arising in the process of production andbusiness of enterprises In the course of financial advisory, in addition to thefunction of advising and explaining to enterprises the understanding of taxpolicy, the tax consulting company also plays a role of synthesizing andanalyzing tax policy inadequacies in the process perform The problems andrecommendations on tax of enterprises provided by consulting companies areoften aggregated from many businesses, which have been analyzed, evaluatedand grounded so they are highly persuasive This has helped state agencies tobetter understand the business practices of enterprises, the inadequacies of

current tax policies and from there, there may be more complete tax policyreforms [1]

Secondly, the tax consulting firm represents businesses that propose tax

policies that are suitable to Vietnam's economic development situation in eachperiod and in line with international practices Although the tax policy ofVietnam has recently been reformed in a positive direction, the current tax policy

is still in the process of reform, transformation and gradually completing to suit

In accordance with the situation of Vietnam's economic development as well asthe process of international economic integration, it is inevitable that obstaclesand heterogeneities will occur As a tax advisor, consulting firms, especiallymultinational tax consulting firms, have acted as consultants, providinginformation, international practices and sharing experiences with planningagencies tax policies when these agencies issued a new tax policy or amended orsupplemented tax policy Therefore, the tax consulting firm also contributes a lot

in helping the tax policy-making agency create a tax legal framework that isbecoming more transparent, clear and consistent

Thirdly, the tax advisory firm has helped taxpayers improve their

understanding and compliance with tax laws through tax advice for businesses.Through regular seminars with customers, publishing monthly newsletters, orusing the website as well as through direct audits, financial and tax advice forbusinesses, consulting companies The tax has regularly helped businesses updateinformation related to the tax field, changes of legal documents, so thatbusinesses can promptly capture information as well as timely orientations getthe business strategy of your business Staff of the financial and tax consulting

company are specialized trained professionals with extensive knowledge ofeconomics, finance, accounting, auditing, good at tax profession, with manypractical experience Therefore, the effect of propaganda and explanation is hugeand enterprises are more receptive to, and understandable, than the presentation

of the tax authorities Therefore, tax consulting companies have helped taxpayersenhance their understanding and compliance with tax laws and act as a bridgebetween tax authorities and enterprises in implementing policies and laws abouttax [2]

Fourthly, the tax consulting company has contributed to preventing fraud,

tax evasion and tax debt Tax consulting companies are often very responsiblefor the tax advisory services they provide to clients Therefore, the company isalways proactive and responsible for guiding taxpayers to comply with currenttax laws On the other hand, in terms of legal and business reputation, the taxconsulting company will have to bear many risks if advising its customers tocomply with tax law Therefore, the activities of tax consulting companies havecontributed to alleviating tax evasion, tax fraud and tax arrears

Fifthly, tax advisory services indirectly reduce lawsuits and avoid

collateral between businesses and tax authorities Through the provision of taxadvisory services, tax advisory firms have contributed significantly to helpingtaxpayers enhance their understanding and compliance with tax laws, preventingtax fraud and tax evasion, tax arrears It is this that indirectly reduces lawsuitsand tax disputes between businesses and tax authorities

b) The role of tax advisory services to taxpayers

The support of tax advisory services for businesses in compliance with taxlaws is essential, helping businesses to timely grasp policies and policies,thereby raising the autonomy in production activities doing business and beingproactive in fulfilling its obligations towards the State According to the GeneralDepartment of Taxation, if businesses are knowledgeable and proficient in taxoperations, they can save tax and create competitive advantages in business Theability of a business to reduce taxes to a minimum depends greatly on devising aproactive tax-saving strategy based on compliance with the law.

Tax consulting services help businesses can identify the right taxes and taxamounts payable to the State to proactively declare and pay tax correctly, canknow and complete the necessary procedures related to tax declaration, taxexemption and reduction, timely tax finalization In addition, businesses cancontrol and detect mistakes, estimate the amount of tax payable for their basicactivities on the basis of which are appropriate decisions for future projects To acertain extent, knowing the tax regime can also help business executives find theoptimal operating solution with the lowest payable tax amount therebyincreasing profit after tax

The role of tax consulting firms is not just to provide start-up companiesthrough services such as consulting on the declaration of taxes, providingguidance on the contents of tax laws, and making final reports payment ofcorporate income tax and personal income tax; advice on international tax laws;tax savings planning scheme; answering questions in the field of taxation butalso providing tax services to companies that have operated in Vietnam becausethey want to have a solid understanding of tax laws, cost savings for businesses

if there is a risk of tax penalties or very high costs for tax experienced staff.Especially for multinational companies, tax advisory services in addition tohelping these companies comply with tax laws to increase business reputation inthe global market also helps businesses take initiative your tax payment in eachcountry As the scale of operations of businesses grows, investors hire businessmanagers, they always require accounting books to be transparent, risks of legalviolations must be controlled and Restricted to the lowest level This is also thereason that these companies require the use of tax advisory services.

For taxpayers being individuals, under the Law on Personal Income Tax,every citizen with taxable income must submit a tax return Most of the incomepreviously exempt or not subject to tax will now be taxable as income frominheritance; trading securities; income from real estate Each income hasdifferent ways of calculating taxes and tax rates as well as taxpayers' deductionsfor family allowances; The partially progressive tax formula is quitecomplicated Tax advisory services will assume this responsibility Taxpayerswill receive advice before receiving any income to see if it is taxable Similarly,when paying a certain cost, see if it can be deducted From there, taxpayers will

be advised on their own spending plan and income plan for tax savings, as well

as full declaration of relevant revenues and expenditures [1]

1.2 Types of tax advisory services

1.2.1 Tax advisory services according to current tax laws

This is the job of advising businesses on compliance with their taxobligations during the operation and declare their tax liability to the taxauthorities of the state It is the advice on current tax policies that apply todifferent taxes for different businesses such as:

- Consulting on issues related to VAT, corporate income tax, PIT, importand export tax, consultancy to carry out contractor tax procedures

- Advice on how to determine the taxable income, taxable income of thetaxpayer, from which, advise the tax rate that the taxpayer must pay to thecompetent state agency;

- Advice on current laws and regulations on cases that are not subject tocorporate income tax, export tax, import tax, personal income tax, and othertaxes;

- Consult cases of tax exemption or reduction according to regulations;

- Current legal advice on the registration of personal tax codes, tax codedependents, business tax code;

- Consult the current law provisions on tax in each specific case of eachindividual, enterprise, agency, organization, Vietnamese residing abroad,foreigners residing in Vietnam , foreigners who do not reside in Vietnam buthave incurred tax obligations in Vietnam;

- Advice on current tax regulations to deal with difficulties, problems, orcomplaints and denunciations of violations of competent state agencies;

- Advice on the levels of sanctioning administrative violations on invoicesand taxes in accordance with the current law;

- Advice on tax law violations that are eligible for criminal prosecution,penalty frames, aggravating circumstances, extenuating circumstances ofcriminal liability for specific cases of customers

1.2.2 Tax consulting services required by tax procedures

This is the job to support businesses on tax procedures during theestablishment and operation process including:

- Advice on registration, issuance of MST

- Advice on vouchers and invoices

- Advice on tax declaration, tax reporting

- Advice on conditions, procedures for tax refund, tax exemption, taxcomplaint

- Consulting tax settlement

- Advise, guide tax declaration procedure when newly establishedenterprises, newly established individual business households, cooperatives,declare to pay tax online, pay tax monthly, quarterly;

- Advice on procedures for certification of information related to taxagencies or competent state agencies that issue decisions and notices on taxpayment to taxpayers according to regulations;

- Advice on the process, records, accompanying documents, proceduresand time for tax finalization, tax refund, tax deduction as prescribed;

- Advice on supporting working with tax authorities in the process ofinspection and examination; consult and / or request an official letter about theviews of the tax / customs authority on issues that are not clearly regulated bytax laws

1.2.3 Tax accounting consulting services

Consulting on tax accounting is the job to help businesses ensure theiraccounting records, tax finalization reports are compliant with tax law, tax costsare reduced to a minimum as follows:

- Consultancy to open accounting records and books for enterprisesaccording to current law provisions

- Consulting how to calculate costs for businesses

- Providing general consultancy for enterprises' preliminary knowledgerelated to the issuance and storage of accounting vouchers, salary regimes, andpayment of social insurance premiums for personnel of enterprises

- Declare and submit all kinds of reports, taxes monthly, quarterly andyearly, settling taxes for businesses

- Prepare and submit financial statements and annual tax settlements

- Prepare and complete a system of accounting books for businesses inaccordance with the current law

- Hand over the voucher book service after the service to the enterprisekept at the company's headquarters

- Guide and advise accounting staff of enterprises to update accountingknowledge and skills in accordance with current regulations

1.2.4 Tax advisory services related to the establishment and development of businesses

This is the job involved in giving tax solutions, advice and explanationsfor future transactions of customers; Help customers get the most tax savingsoperation plan Tax planning, building an effective business structure for taxpurposes, tax complaints can be classified in this category

1.3 Tax consultancy services for businesses doing business

1.3.1 Basic concepts and characteristics of businesses in the field of commercial business

Commercial business enterprise concept

A commercial enterprise is a business unit legally established, with theaim of carrying out business activities in the field of commerce, established withthe purpose of carrying out activities in trade and business activities purchaseand sale of goods with a view to making a profit " Thus, an economicorganization considered a commercial enterprise must meet the following twoconditions:

• Must be established in accordance with the law;

• Must perform a commercial function directly for the purpose of making

a profit

Basic characteristics of commercial business enterprises

Laborers of commercial enterprises are complete or relatively completegoods products The task of commercial enterprises is not to create value of useand new value, but to realize the value of the goods, bringing the goods to theend consumer This is a very different point between commercial enterprises andother businesses

The operation of a commercial enterprise is customer-oriented, so theassignment of specialization within each enterprise as well as among commercialenterprises is much more limited than that of manufacturing enterprises

The "indispensable" connection between commercial enterprises to formthe economic - technical industry, from a relatively loose but very coherent andstrict technical perspective of commercial activities

All of the above characteristics create characteristics of CommercialEnterprises But the growing trend is that commercial enterprises have very closerelationship to enter production enterprises and service enterprises in the form ofcapital investment for the form of capital investment for production order withproduction combined export and after-sales service These are all for consumers

to satisfy their needs to help them have a good impression and depend on theircommercial enterprises Thereby commercial enterprises increasingly beneficial

1.3.2 The role of enterprises in the field of commercial business

Business enterprises Trade is an integral part of the economy, it was borndue to the process of social division of labor In a multi-component marketeconomy, the presence of trading companies will make the speed of goods flowfaster, regulating goods from redundant to deficient places, the needs ofconsumers are always meet and satisfy, stimulate production development,promote product development and improve people's lives.

Serving consumer demand: Commercial enterprises through tradeactivities and services provide goods quantity to meet demand, location andtime Commercial enterprises make goods brought from surplus to shortage is forthe needs of consumers always satisfied

- Stimulating production and development: A commercial enterprisepurchases products of a manufacturing enterprise to facilitate production toquickly recover capital, concentrate capital and manpower for production andcontinue its production cycle Commercial enterprises also provide input servicesfor production to boost production development Commercial enterprisesrespond to demands that arise in the market so that production can quickly meetnew needs and develop new markets

- Promote the development of science and technology: A commercialenterprise purchases products of a manufacturing enterprise to facilitateproduction to quickly recover capital, concentrate capital and manpower forproduction and continue its production cycle Commercial enterprises alsoprovide input services for production to boost production development.Commercial enterprises respond to demands that arise in the market so thatproduction can quickly meet new needs and develop new markets

- Expanding international economic relations: commercial enterprisesthrough trading activities has made goods exported to foreign countries orimported goods from abroad thereby creating new international relationship tobenefit both sides.

- Creating accruals: commercial enterprises invests capital and labor toconduct business, so it can also benefit, from this profit commercial enterprisescan increase accumulation to contribute to the national budget

1.3.3 The need to develop tax advisory services for commercial businesses

a) Regarding theory

As we all know, taxes are always a concern of and a focus of allbusinesses in general and commercial enterprises in particular, because tocontrol risks and tax settlement appropriately businesses often spend a lot of timeand money That is why tax advisory services in businesses were born and at thesame time is one of the extremely important legal services of the business.Moreover, tax advisory services support businesses to fully solve all tax riskswith the most economical costs, giving businesses the long-term developmentdirection in the future In particular, the current tax situation in Vietnam such as:

The constant change of tax policy: Vietnam is in the process of

integration and development, making the business environment always changing

As appropriate, tax laws also need to change in order to align with the actualbusiness situation However, not all Business Owners are always proactive inupdating tax law innovations if they do not have good tax consultants or

accountants Tax advisory services will support updating tax information quicklyand suggest effective solutions for businesses.

Complicated tax documents: Reading and knowing the changes of tax

laws is one thing that applying that tax law to each specific practical case isanother matter There are many related tax documents regulating every problemthat occurs in reality If you are not a tax expert, not updated enough andknowledgeable about this issue, even if you are penalized, you will not knowwhat you did wrong This has led many businesses to face tax risks and sufferheavy losses when tax authorities come to inspect

The initial tax procedure is troublesome: For start-up businesses, the

large amount of work leaves many business owners with little time to payattention to the tax issue However, there are many tax procedures that newlyestablished businesses must do; especially for foreign-invested enterprises Whatbusinesses need to do and avoid doing to limit tax risk in the future? Taxadvisory services will help clarify this matter for you

Tax risks and arising situations: All tax risks and violations must be paid

in cash and sometimes a lot of money Besides, in the course of business, youwill not know which situation you will face Therefore, thanks to the taxadvisory service, many businesses have been "conserved" in arising taxsituations, minimizing tax risks and saving costs effectively

For businesses that enforce tax laws, each arising economic activity may

involve one or more taxes Moreover, a very basic point to consider the impact

of taxes on the arising business is the tax policy, procedures applied and the

attached invoice and voucher Therefore, in the implementation process,businesses may be excluded by tax authorities from taxable expenses, revenue,

or tax due to their failure to fully understand relevant regulations andrequirements Enterprises have incurred economic and international tradeoperations that Vietnam has not encountered, resulting in the lack of clear andspecific instructions Moreover, many operations must be handled in accordancewith the law on investment, trade, finance and accounting, so they must workseparately through discussions with tax authorities and related ministries andbranches In addition, the interpretation of current tax regulations in somelocalities is different, so tax advisory services will help businesses apply andexplain the viewpoint of dealing with tax authorities in a harmonious manner, toensure that enterprises comply with their obligations fully without affecting thebenefits they enjoy

b) Regarding practice

It is a fact that not only exists in Vietnam but also in many countriesaround the world that many businesses have gone into business, generatedrevenue but have not built an organization for accounting and regulation taxfinalization inspection process In particular, this situation often occurs for smalland medium-sized enterprises because the business owners do not know the legalprovisions on taxes, do not timely update the changes of the regime plus thelevel of personnel new math fledgling The fact that businesses do not pay muchattention to building a professional and effective accounting and accountingcontrol organization from the beginning has led to many potential risks for thebusiness Specifically, after 3 to 5 years, when inspecting and examining the tax

finalization, the enterprise does not guarantee the data, insufficient documents,vouchers and accounting books to explain, resulting in being traced collectinglots of tax money at the same time.

On the other hand, there are many businesses still having difficulty inapplying new invoices such as although the turnover is large, the number ofinvoices issued is small (Example: real estate enterprises), or the revenue is notmuch but invoices are issued continuously (For example, commercial businesses

or supermarkets) In addition to some of the above problems, businesses nowalso have difficulty placing orders because the printer overloads the order.Although the Ministry of Finance also allows businesses to use unused invoicesuntil March 31, 2011, businesses also need to have appropriate plans to ordernew invoices to use

Since then, tax advisory services have become the most effective choicefor businesses operating in this field Become an effective bridge betweenbusinesses and tax authorities, tax consultants help businesses comply with theirtax obligations, avoid waste, tax evasion and tax arrears

1.3.4 Factors affecting tax advisory services for commercial businesses

1.3.4.1 The subjective factor

a) Qualifications of tax consultants

Organizing the apparatus of tax advisers and officers has a decisive role tothe quality of tax consultancy services at the enterprise itself The allocation ofhuman resources for counselors in a reasonable way, in order to build a system

of staff of scientific departments, departments, which is appropriate, ensuringconsistency, fully and effectively implementing improve the quality andefficiency of tax consultancy activities Appropriate allocation of tax consultancyresources, covering potential risk subjects and frauds and errors will maximizethe effectiveness of risk management, thereby providing a direction for advicespecific and professional In contrast, inappropriate allocation of resources toadvisors: cumbersome, unprofessional, unclear assignment of responsibilitiesamong departments, tasks of each group of employees will reduce the quality ofanalysis risk and reduce consulting solutions to solve problems for customers

Therefore, the human element is very important, determining the quality

of tax advisory services Without professional and specialized human resources,with extensive knowledge of tax, accounting, analytical skills, problem synthesisand good ethical qualities, even if the business has Modern facilities, largeinvestment costs in equipment and technical infrastructure of the company,effective marketing quality to attract more customers, it is difficult to havepositive tax consulting results Therefore, the human resources of the officialsand consultants recruited and trained in-depth and professionally are veryimportant factors, directly affecting the tax consultancy results for customers

b) Processes, procedures and methods of tax consultancy

Tax consulting processes and procedures have a great influence on themanagement and risk analysis of errors in the tax consultancy process: Scientific

and reasonable consultancy processes and procedures will make steps forwardsimple implementation, ensuring legal advice, saving time and money,convenient for the Company to perform independent consulting services andcustomer businesses The process, procedures for scientific consulting, in-depthand professional risk analysis will help the tax consultancy activities betransparent and clear On the contrary, the process of consulting and analysis iscumbersome, too many forms, many procedures cause the consulting time to beprolonged, causing trouble for customers Therefore, improving the tax advisoryprocess will significantly improve the quality and efficiency of analyzing theissues, thereby making it the best tax advisory direction for businesses.

The consulting method also significantly affects the analysis andmanagement of tax risks during the tax consultancy process If choosing themethod of analyzing, managing risks, summarizing inappropriate matters,enterprises providing consulting services will not achieve the effectiveness of taxconsultancy according to the analysis and management of tax risks as expectedwant If businesses providing consulting services only use a single method ofanalysis, management and synthesis in the tax consultancy process, they willproduce incomplete results, but must use many combination methods If it is notbased on the situation, production and business characteristics, businesscharacteristics of each customer enterprise that applies the consulting method inthe order that will lead to omission, unsuccessful, incorrect and There will beinsufficient time to analyze and synthesize critical customer errors, resulting inlow quality and low consulting effectiveness Therefore, in order to provide taxadvice based on the results of analysis, risk management and generalization ofissues to achieve quality and efficiency, tax consultants and staff should consider

and discuss carefully the method of distribution analyzing and synthesizingissues in the tax consulting process at the customer businesses accordingly,scientifically, avoiding the reaction of the customer business but still achievingthe highest results.

Through analyzing enterprise information, the consulting department willspecifically propose the content, object and scope of analysis and evaluation;generalize these proposals in the advisory decision and specify in the outline,plan for conducting the consultancy and analysis, and submit it to the taxconsulting team for decision and approval Performing the task well in this stage

is a very important requirement in ensuring the implementation of focused andfocused consultancy and analysis, avoiding the spread of content and not beingdelayed in time while ensuring the fulfillment of requirements set forth in theconsultation process

c) Facilities and equipment of tax consultancy enterprises

In the modern tax consulting process, all tax inspection jobs from riskidentification analysis, risk ranking, risk checking to post-consultationconsultancy and monitoring at the enterprise must with the support of computertechnology The level of success of tax consultancy is based on risk analysis,review and finding out tax violations in the course of business activities of thebusiness depends mainly on the level of Application of computer technology fortax consultancy

The facilities (equipment, technology) invested in the tax advisory processalso make an important contribution to the quality, productivity, and

effectiveness of risk analysis, review, and detection of violations in tax advice.Poor and outdated equipment makes the company's staff and consultants facedifficulties in the process of reviewing, analyzing, summarizing, time of riskanalysis, review will be pulled In the long run, the risk analysis results will beinaccurate and the total problematic errors committed by the client company lackverification grounds and are easily clarified by tax authorities.

d) Quality of supervisory activities after tax risk analysis

The effectiveness of analyzing and managing the risk of mistakes after taxconsultancy depends greatly on the handling of the results after tax consultancy

to ensure that tax amounts are remitted into the state budget fully and promptly,enterprises Customers rectify violations Monitoring of post-consultancyanalysis results not only assesses the compliance of the client's business with taxauthorities' inspection conclusions, but also evaluates the effectiveness of theconsultancy tax On the one hand, after-consulting supervision at the client'senterprise, on the one hand, it is possible to re-test the forecasts about potentialsigns at the consultancy planning stage, helping the consultancy planning stage

to be closer At the same time, it will detect the deficiencies of the risk analysisand management stages before and during the consultation and take correctivemeasures to improve the quality and effectiveness of the analysis, managementand evaluation Price risk in tax consultancy activities

1.3.4.2 The objective factors

a) The current system of tax legal documents

The process of tax consultancy based on the application of the proceduresfor analyzing, assessing and managing risks of tax related violations must bebased on current tax laws and regulations of the State country The complete taxlegal system is a solid legal basis for analysis and evaluation activities, therebyproviding the most appropriate advice for customer businesses.

Tax consultancy activities based on the application of analysis, assessmentand management of tax risks with quality and effectiveness depend largely onthe system of legal documents related to taxes and practice current tax collectionfor the state budget Tax laws, the Law on Tax Administration and the Law onInspection are the basis for adjusting the procedures for analyzing, reviewing,summarizing and evaluating the tax consultancy process Therefore, the full legaldocuments, consistent with the reality and management requirements willpromote the effective tax consultancy process On the contrary, if the current taxlaws are incomplete, inconsistent with the reality and tax managementrequirements and circumstances in businesses will negatively affect the qualityand results of the consultation tax

Having a complete and complete tax legal system suitable to the economic situation of the country will be an important legal basis for thecompliance of tax laws of enterprises into the framework at the same time helpbusinesses understand and seriously comply with the provisions of the law The tax policy system needs to be uniform, the contents of taxes need to be clearand transparent If the legal documents overlap, have conflicting content, unclearregulations that can be understood in different ways, and cumbersome regulatoryprocedures will make it difficult to analyze and evaluate wrong in the tax

socio-advisory process, therefore, will lack the persuasion of businesses, easily leading

to objections, affecting the quality and results of tax advice A consistent,unbiased tax policy for any business will create an equal business environmentfor all businesses Strict legal policies create pressure on businesses to focus onmaking business accounting more transparent and reduce the intent of non-compliance of enterprises This is also an important factor to create discipline intax administration, improve the compliance of enterprises and create conditions

to improve the efficiency of tax consultancy activities

b) Independence in the process of analyzing, assessing and managing risks in tax consultancy

Independence is one of the attributes of independent tax consulting incustomer businesses, it has an indirect effect on the quality of tax analysis,assessment and risk management in the tax consulting process

If the tax advisor cannot be independent in its operation, especially whenunder the pressure and impact of political factors, external factors, direction andarrangement of superiors, the effectiveness and results of Consulting activitiesbased on the results of analyzing, evaluating, synthesizing and managing risks oftax issues at enterprise customers will only be formal and this will lead to theconsultants not being able to meet the goals his influence Therefore, the moreindependent the authority of tax advisor in carrying out the duties, the moreobjective and transparent the results of analysis, assessment and riskmanagement

The application of risk analysis and assessment in the tax consultancyprocess is based on the scoring criteria to select subjects of annual review andanalysis, objectively assessing to help enterprises provide consulting services.Tax limits negative manifestations, harassment from a number of competentindividuals make business customers not assured business and increase theobjectivity for the tax consulting process.

c) Coordination of relevant agencies

In order to apply the procedure of analyzing, reviewing, inspecting,assessing and managing risks in matters of tax consultancy activities with highefficiency, in the course of operation, it is necessary to coordinate with agencies.Relevant functions such as policies, customs, treasury, banks, police agencies,consulted enterprise management agencies and third parties (customers, partners

of enterprises) Without the cooperation of these agencies, businesses providingconsulting services will not be able to collect all relevant information toconclude the tax advisory process accurately, objectively and easily overlookedviolations At the same time, sharing, exchanging and learning experiences indealing with related issues, supporting each other in solving jobs helps reducecosts, time and effort in the analysis activities price and summary from whichoffers the best consulting strategy for customer businesses

d) Factors affecting from the business

The level and self-awareness of businesses directly affect the compliance

of businesses and affect risk management in tax advice, affecting the efficiency

of tax consulting activities The higher the level of enterprises, the betterunderstanding of tax laws as well as the self-compliance of enterprises, becausethey understand their rights, benefits and responsibilities when complying or notcomplying with the law tax On the contrary, because of inadequate knowledge

of tax laws, some businesses intentionally evade increasingly sophisticated taxevasion tricks, making it difficult for businesses to provide consultancy servicespresent fraud through risk assessment analysis, thus reducing the effect,effectiveness of analysis, assessment and risk management of errors during andafter tax advice

e) Sources of information and data provided by the customer enterprise

Centralized database is an important information platform that helpsbusinesses providing consulting services to gather a complete and convenientdata system for risk analysis, consultancy planning, and help giving counselorsconvenient access, retrieving and reviewing important data during theconsultation operation Modern business process of tax consulting applies theconsulting method based on analyzing and assessing risks from the maininformation system about enterprise customers of consulting service enterprises.The requirement of the centralized information and data sources is to ensure thatthe relevant departments are exploited and used to understand the customerbusiness, understand the entire process of production and business activities, thesituation of submission tax and compliance history, inspection history of the taxauthority for customer businesses The consulting department will collect and

classify customer businesses in its consulting plan according to the level of taxrisks and the level of trust of customers in fulfilling tax obligations to the State

Information is the basis for managing customer enterprises in the State andcontributes to the forecast analysis of socio-economic development trends,revenue sources, and the impact of tax policies on economic growth On thebasis of capturing information about customer businesses, overcoming thesituation of widespread inspection and review, causing trouble for customerbusinesses, especially for those enterprises that strictly abide by tax laws.Therefore, it can be affirmed that information about customer businesses is animportant factor affecting tax advisory results Without information, full data ofconsulting service providers will face many difficulties in consulting process atcustomers' businesses

CHAPTER 2

CURRENT SITUATION OF TAX CONSULTANCY SERVICES ACTIVITIES FOR COMMERCIAL BUSINESSES AT AAGROUP

CONSULTANT AUDIT COMPANY LIMITED 2.1 Overview of AAGROUP Auditing Consulting Co., Ltd.

2.1.1 The establishment and development of the company

- Company name: AAGROUP CONSULTANT AUDIT COMPANYLIMITED

- English name: AAGROUP AUDITTING CONSUTLTING COMPANYLIMITED

- Abbreviated name: AAGROUP CO., LTD

- Address: AAGROUP Building, 140 La Casta, Urban Area, Van Phu, HaDong, Hanoi