## 3.1 Self-Assessment Tax (SAT) and Company Tax 

It was observed that BR did not submit any Self-Assessment Tax (SAT) for the year under review which is a violation of the Income Tax Act. This could result in penalties charged on the organization for non-compliance. 

In response management stated that they had sought and had been given a grace period of 21 months. Furthermore the forecast of BR performance showed that they would be making losses in the tax year ending June 2018 and therefore no taxable income was foreseen. Management had since submitted the tax returns for the financial year ended 31 March 2018 and had also submitted the Self-Assessment Tax for the 2 nd quarter. Management would ensure that going forward they submit as per BURS requirements. 

## 3.2 Tax on Non-Cash Benefits 

The Botswana Railways did not charge tax on non-cash benefits (housing, car, furniture and fittings) for two of its employees, as required by the Income Tax Act that for non-cash benefits to be included in the remuneration of employees. 

In response, management noted the finding and indicated that they were in the process of determining the values of the houses as the tax charge was calculated based on them. They further stated that they had received monthly benefit source documents for the car from Avis in June 2018 after the year end as such they did not have source documents to determine the tax chargeable on the car benefit. They further stated that the furniture was only bought in the financial year 2018. 

## 3.3 Stock Take Variances 

It was noted that the stock count for the financial year 2017/18 resulted in a net variance of P3 122 072.11 which was made up of negative and positive balances. While differences between the stock levels in the system and on the floor are likely to be found during stock counts, investigations should be carried out to help identify the cause of stock variance and measures put in place to reduce the variances to acceptable levels. The table below represents system data which is not an accurate reflection of what was actually on the shelves. 

