950816

FPCCI for staggering

IT return filing dates

KARACHI: Iftikhar Ali Malik, Acting President FPCCI has strongly opposed the CBR decision whereby all firms/companies, whether private or public, with a few exceptions, are required to file Income Tax returns on a uniform date of 30th June, 1995.

In a statement issued to the Press the Acting President FPCCI said that by withdrawing the option available to the various categories of assessees to observe income year to suit their requirements, the government will be putting the firms/companies and also the Chartered Accountants and internal/external auditors in serious difficulty.

He pointed out that in numerous business houses which own more than one company, each sister unit has separate accounting staff at junior level but at the group level there are only two or three senior executives who oversee and finalize the accounts of each company under the group. By declaring 30th June as the closing year, the burden on the in-house accountants, particularly at the senior level will be formidable and very taxing as they will have to simultaneously prepare the accounts of the companies falling under the same group, supervise the internal audit, deal with the external auditors and finally get the accounts ready in time.

Similar will be the condition of external auditors who have a number of companies as their clients and will be under tremendous pressure to audit the accounts of all their clients in a short time.

Iftikhar Malik said that retrospective effect of amendment in the Income Tax Ordinance will create serious problems for the assessees which were closing their accounts on 31st December and have now to close on 30th June, 1995. For example in the case of limited companies, the stocks, investments etc. have to be physically varified for which arrangements have to be made in advance, which has not been done.

Further, permission under Section 233 of the Companies Ordinance, 1984 for change of accounting year by all listed and unlisted companies is also required from the Corporate Law Authority. The AGM has to be called and all stock exchanges in Pakistan need to be informed with book closure at least for 15 days. Besides, special permission from Registrar of Companies and approval of general body meeting is essential.

The Acting President FPCCI says that if CBR is thinking to collect more revenue in the fiscal year 1995-96 since the collections under this head would be for a period greater than one year, it should not forget that this will be a one-time gain only and in 1996-97 the revenue under this head will again come down.

He therefore advised the government to avoid short term gains and pursue long term policies for the health of the national economy.