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Big Data Audit: Digital Transformation of the Audit Process at Ecovis in Colombia

ECOVIS Colombia has developed a machine learning model that identifies deviations or atypical behaviours in clients’ transactions. This implementation optimises the auditing and consulting processes and allows clients to react more quickly when anomalies are detected.

The analytics tools were developed by Ecovis to support auditing within the concept of data analysis using business intelligence (BI) models and the application of machine learning.

How the Project has Evolved During the Pandemic

Clients’ historical financial information was uploaded and at the same time an outlier, or anomaly detection model was developed through the construction of an algorithm using machine learning. The entire Ecovis team was trained on how to use the tool with clients.

These anomalies can be described as transactions that are outside of the normal behaviour and are identified after training the machine learning model using historical transactions. Anomalies or outliers should not be understood as errors and they should be validated with different audit tests.

With the analytics tools that we have developed, we can quickly identify critical deviations in the business processes of our clients.

Rodrigo Moreno Navarrete, CEO, ECOVIS Colombia SAS, Bogota, Colombia

The above implementation has been applied to everyday transactions and, more importantly, has enabled the Ecovis team to analyse what was almost impossible to inspect manually across the ocean of transactions reported by clients.

Such a detailed audit revision, using BI models, can provide insights into business performance and, alongside the risk matrix and internal control evaluation procedures, allows auditors to track business continuity milestones. Anomaly detection enables Ecovis to identify high impact transactions that may affect the financial statements to be reported, even if it turns out that they are within the normal process of the transaction, explain the Ecovis experts.

Ecovis has used the time during the COVID-19 crisis to develop the project on targeting audit practice. These models can certainly be used successfully in business consulting practice in post-pandemic times.

There is now greater visibility in front of clients and the opportunity to visualise risks in real time, say the Ecovis advisors.

For further information please contact:

Rodrigo Moreno Navarrete, CEO, ECOVIS Colombia SAS, Bogota, Colombia
Email: rodrigo.moreno@ecovis.co

Invest in Uruguay: Increase in Tax Benefits for Investment Projects

The Uruguayan government recently approved an increase in the tax benefits granted through the Investment Law (Law 16.906). Under this law, taxpayers could qualify for significant tax exemptions by submitting an investment project that is declared by the executive powers to be in the national interest.

Companies investing in Uruguay in the future can expect a number of tax breaks. These include, for example, new regulations for corporation tax or tax concessions in property tax, VAT and customs duties.

Corporate Income Tax Exemption

1. The tax exemption amount is limited to a percentage of the investment that is committed to being undertaken. This percentage varies according to a score that is assigned to the project based on an indicator matrix (such as job creation, increase in exports, decentralisation, and clean technologies). In addition, depending on the investment project’s sector of activity, businesses can select a sector indicator, explain the Ecovis consultants.
   The increase in tax benefits means that all investment projects executed between 1 April 2020 and 31 March 2021 can be counted as 150% of the amount invested. Furthermore, the percentage assigned by the indicator matrix will be increased by 20%. For example, if an investment of USD 1,000,000 obtained an exemption score of 30%, with the increase in the tax benefits the project can exempt up to 36% of USD 1,500,000.
   These increases to 150% and 20% only apply to projects that have effectively executed at least 75% of the total investment by 31 December 2021.
2. The tax exemption amount is limited to the effective investment carried out, as opposed to what was committed. The planned investment amount could vary and be less than was initially intended. For example, if the approved committed investment was USD 1,500,000 but the amount effectively executed ended up as USD 1,490,000, the tax benefit applies to USD 1,490,000 and not to USD 1,500,000.
3. The tax exemption in each financial year cannot exceed 60% of the tax calculated prior to the exemption. For new businesses, this can be increased to up to 80%. This means that all businesses must pay at least 20 to 40% of the corporate income tax determined for the fiscal year.

The Uruguayan government has launched a series of tax breaks for investments. This strengthens the economy and makes the country attractive to foreign investors.

Montserrat González, Tax Partner, ECOVIS Uruguay, Montevideo, Uruguay

Entitled Investments

The entitled investments include those which undertake the construction of immovable property and the acquisition of movable assets required for the operation of the promoted activity, say the Ecovis experts, who can support companies in the development and evaluation of investments.

Duration

Businesses have a minimum term of three fiscal years to account for the tax exemption.

For further information please contact:

Montserrat González, Tax Partner, ECOVIS Uruguay, Montevideo, Uruguay
Email: montserrat.gonzalez@ecovis.uy

Ecovis is now offering legal services in Argentina

Beside our existing partners ECOVIS ARGENTINA RAMOGNINO, de ALBALADEJO & ASOCIADOS our network now also offers legal services to our clients. We would like to send a warm welcome to our new partners from Estudio Peebles – Member of ECOVIS International in Argentina.

Estudio Peebles – Member of ECOVIS International started its business in October 2012. Carlos Eduardo Peebles, managing partner of the firm, leads a team of four professionals. The firm is client oriented and dedicated to the advice on business law in general including corporate matters (mergers and acquisitions, due diligence), commercial law, contracts, antitrust matters, labour, compliance and real estate law.

Welcome to the Ecovis family!