Customs audit-related activity and penalties are on the rise, but companies can take a number of steps before and during audits to mitigate their potential impact. U.S. Customs and Border Protection conducts audits and other professional services throughout the U.S. Audits generally have targeted objectives, involve data analysis and risk assessment procedures to determine scope, and are compliance-driven. Deping on the objective the audit may or may not include an assessment of the importer? internal controls over customs compliance. Audits also include focused assessments, which are comprehensive audits that use a risk-based approach to determine if the importer represents an accep risk to CBP. CBP also conducts risk analysis and survey assessments, which are not performed as audits but require assistance consistent with auditors?ss and expertise. RASAs allow CBP to obtain information about a company? import activities related to a specific trade area or issue. While they can be an opportunity to avoid a more intensive review, they can also result in full-blown audits or other enforcement actions if they are not taken seriously. CBP recently reported that the number of audits it completed annually decreased from 466 in FY 2020 to 417 in FY 2024. However, other audit-related activity increased during that time, including the following. - revenue collected from importer audits: from $44.6 million in FY 2020 to $117.7 million in FY 2024 (+163.9 percent) - number of trade penalties issued: from 2,035 in FY 2020 to 2,204 in FY 2024 (+8.3 percent) - number of liquidated damages: from 18,932 in FY 2020 to 22,399 in FY 2024 (+18.3 percent) - revenue collected from trade-related penalties and liquidated damages: from $21.7 million in FY 2020 to $26.3 million in FY 2024 (+22.0 percent) These statistics highlight CBP? increasing scrutiny of import compliance and the consequent need for importers to take proactive steps to maximize compliance while preparing for potential audits.
