The Bureau of Customs' Post-Clearance Audit Group (PCAG) has the authority to audit any importer's records for up to three years after importation. What they're looking for is straightforward: do your actual imports match your declarations? Are your duty computations correct? Are your permits in order? Are your records complete and accessible?
Businesses that are audit-ready answer "yes" to all of these questions before the audit notice arrives. Businesses that aren't find out the hard way - through findings, assessments, penalties, and the operational disruption of assembling documentation under deadline pressure.
What "Audit Ready" Actually Requires
Accurate Import Entry Records
Every import entry filed by your customs broker on your behalf should be retained - including the goods declaration, supporting invoices, packing lists, and the customs release document. These records form the foundation of any audit and must reconcile with each other and with your internal accounting records.
Consistent Customs Valuation
BOC audit findings most commonly arise from customs value discrepancies - declared values that appear inconsistent with market prices or that don't include all dutiable additions (commissions, royalties, related-party pricing adjustments). Audit-ready importers have a documented, defensible methodology for customs valuation and maintain the purchase documentation to support it.
Accurate HS Code Classification
Incorrect HS classification results in incorrect duty rates - whether intentional or not. BOC auditors check classification accuracy against the Harmonized System and the applicable AHTN (ASEAN Harmonized Tariff Nomenclature). Importers who have never had their classifications independently reviewed are frequently surprised by what an audit uncovers.
Complete Permit and License Documentation
For regulated commodities, permits from BAI, BPI, FDA, DENR, and other agencies must be maintained alongside the corresponding import entries. An audit that finds imported goods without the corresponding permit - even if the goods were genuine and the import legitimate - triggers findings and penalties.
Certificate of Origin Records for FTA Claims
Every time you claim a preferential tariff rate under an FTA, the corresponding Certificate of Origin must be retained. FTA claims are a specific audit focus area - not because they're inherently suspicious, but because they represent duty revenue foregone by the government, which auditors want to verify is legitimate.
How TMG Conducts Pre-Audit Compliance Reviews
TMG's trade compliance team conducts pre-audit reviews that mirror the BOC's audit methodology: reviewing import entries from the past 1-3 years, cross-checking HS classifications, verifying permit records, and identifying valuation exposures. Findings from our review give clients the opportunity to correct issues, prepare documentation, or seek voluntary disclosure - options that are no longer available once a formal audit commences.
For importers who want to get ahead of their compliance status, contact TMG to discuss a pre-audit compliance assessment.