Why ANSI is a BIR Recommended CAS ?
Many Filipino business owners consider regulatory compliance to be a tedious affair. The process often involves submitting heaps of documentation and coordinating with multiple government agencies—tasks that take up valuable time and resources that could otherwise be spent on core business activities. Due to these challenges, some business owners are tempted to put their compliance matters on the back burner and revisit them at the very last minute.
But even though compliance may not be an engaging aspect of doing business, it’s still worth prioritizing. Government agencies like the Bureau of Internal Revenue (BIR), for instance, require businesses to register their computerized accounting system (CAS). According to BIR RR No. 9-2009, large taxpayers must maintain their own CAS and electronic records for tax compliance and audit integrity. A CAS must also be registered accordingly, following policies and guidelines stated in RMO No. 21-2000, and following the application and approval procedures stated in RMO No. 29-2002. Failure to comply can result in steep penalties, which can disrupt business operations and strain a company’s relationship with tax authorities.
As such, if you’re currently modernizing your business with a computerized accounting system, there’s a pressing need to ensure that you’re BIR-compliant. While the process may seem daunting, it can be navigated smoothly with proper preparation. To help you stay on track with BIR regulations, here’s a briefer on everything you need to know about the process.
Registering Your CAS at the BIR Is a Requirement
All companies that intend to use a CAS for their accounting procedures, regardless of whether they’re mandated to by law or choose to do so of their own volition, must register their CAS at the BIR. This ensures that the system used is recognized, verifiable, and compliant with the BIR’s data integrity and audit standards.
In case a major system or modification is made to an existing CAS, companies should also register anew at the BIR. These CAS enhancements and modifications encompass changes to the functionality of the system, any addition or subtraction of modules or sub-modules, and other changes that will impact major financial aspects of the system. Minor system enhancements to the CAS, like bug fixes, require a brief letter of notification to the business’s Revenue District Office (RDO). These steps are required for the BIR to maintain accurate records of the system’s setup, ensuring that all updates continue to meet compliance and audit requirements.
The Registration Process Isn’t as Difficult as it Seems
If you’re new to the process of registering your CAS, you might think it’s exceedingly complicated. However, the BIR has released a circular to help businesses adopt their own computerized accounting systems more easily.
Known as Revenue Memorandum Circular No. 5-2021, this policy simplified and streamlined the registration process for CAS users. Before this circular was issued, any company that wanted to register a CAS had to go through a system demo or pre-evaluation by BIR officers. Companies were also required to wait for a Permit to Use (PTU) before they could implement their new CAS.
As of this writing, BIR no longer requires a system demo or the issuance of a PTU. First-time CAS registrants only need to submit their documentary requirements for registration and wait three working days for an Acknowledgment Certificate before rolling out their CAS.
Your CAS Should Contain the Correct Core System Components
To stay compliant with BIR standards, your CAS must include modules that can reliably capture, process, and store all accounting and tax-related data. These components are designed to ensure consistency and transparency in your company’s financial data, making it easier to comply with audits and other regulatory requirements. According to Revenue Memorandum Order 29-2002 issued by BIR, a fully compliant CAS should contain the following components:
- A general journal, accompanied by other subsidiary records
- Accounting records such as books for sales, books for purchases, books for inventory, books for accounts payable, books for accounts receivable, payroll ledgers, and subsidiary ledgers
- Application systems that are involved in generating the subsidiary ledger and are responsible for official accounting documents, such as invoices, cash vouchers, official receipts, journal vouchers, sales tickets, and billing statements
- Application systems that are responsible for generating reports specifically required by the BIR
- Point of sale (POS) systems and other sales channels, such as e-commerce platforms or other revenue-generating systems that are linked to the CAS
While not explicitly listed as a separate component, ensuring your CAS has an audit trail functionality is also expected. This is to record all user activities, data entries, and system changes, so that any transaction can be traced and verified during a BIR audit or internal review.
Make Sure You Have the Necessary Documents for your BIR CAS Registration
A great way to streamline your CAS registration is to prepare all required documents. The BIR requires businesses to submit a list of specific forms and supporting documents, and incomplete submissions can result in processing delays or rejection. Here are the documents you’ll need to prepare:
- A duly accomplished BIR CAS registration form (BIR Form 1900)
- Documents to validate the company’s profile (e.g., BIR Certificate of Registration)
- Previously issued BIR permits
- List of branches that will use the CAS
- Map with the business headquarters location
You’ll also need the technical requirements of the CAS to be used. These include the following:
- Application name
- Proof of system ownership
- Process flow
- System flow
- Disaster and recovery plan
- Summary of the system’s features and functions
- Samples of reports and correspondence that can be issued by the CAS system, among others
For applications for system enhancements or modifications, you’ll need to pass a copy of your previous BIR Permit to Adopt CAS and a letter to the agency detailing the modification or enhancement to your CAS. These requirements may be subject to change in the future. As such, be sure to double-check with an authorized representative of the BIR before you finalize your registration.
The Benefits of Using a Fully Compliant CAS
A fully compliant CAS helps ensure that your accounting processes run smoothly and in line with BIR regulations. It provides accurate and organized financial data, making audits and reporting easier to manage. Compliance also reduces the risk of penalties and fosters greater transparency within your operations. In the long run, it strengthens your business’s credibility and supports better financial decision-making.
BIR CAS Compliance Made Easy with ANSI Information Systems
Even though BIR has simplified its CAS compliance requirements, first-time owners of a CAS may still feel overwhelmed about the process. If you’re hesitant about onboarding a new CAS and fulfilling the BIR’s requirements, don’t hesitate to contact ANSI Information Systems. Our company has been providing Filipino businesses with reliable accounting and business solutions for more than three decades, and our experience ensures that you receive expert guidance and seamless support. Call ANSI Information Systems now, and make us your partners in your BIR CAS compliance journey.
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