CARM | Financial Statement Changes in Release 2
An Editor's Note: The features of Release 2 mentioned in this article are now anticipated in May of 2024. Please kindly bare this in mind while reading.
Canada Border Services Agency (CBSA) Assessment and Revenue Management (CARM) is a large multi-year project which started in 2016 with the Accounts Receivable Ledger (ARL).With release 2 of CARM, changes will be made to ARL. Keep reading to learn more.
What Is ARL?
ARL changed the way importers or their customs brokers were able to see import accounting records. The monthly K84 was replaced with a Statement of Account (SOA) for both importers and third-party service providers.
CBSA under ARL combined multiple transaction types into one statement with Daily Notices (DN) and monthly SOAs. This change enabled account-level management and reconciliation which assisted importers to manage payment due dates.
Importers are eligible to receive their own DNs and SOAs electronically. The Importer simply needs to apply to the CBSA Technical Commercial Unit (TCCU).
What Is Changing With Release 2?
In CARM Release 2, which is scheduled for Spring 2022, there will be changes with the ARL Financial Statements to include:
- SOAs and DNs will be issued to importers/account holders as a PDF on the CARM Client Portal Profile (CCP) and to EDI certified account holders via EDI in XML format.
- The customs broker will have the ability to view their client’s transaction information on the CCP if this work is assigned to them and they have been delegated access.
- SOAs will be issued to importers who have incurred a financial transaction with the CBSA on their account. SOAs will summarize the transactions posted on the Importers account in CARM and for which the importer is liable to make payments.
- The SOA will no longer be transaction based and will instead be account based to provide a summary of all transactions recorded in the billing period.
- Summarized amounts per transaction type included in the SOA:
- Payments received
- Disbursements issued
- Interest and penalties
- New debit items
- New credit items
- Revenue breakdown for declaration based transactions, including customs duties, excise duties, excise tax, SIMA, GST/HST and PST.
- The SOA will be generated and posted to the CCP on the 25th of month 2 for all types:.
- The Importer and customs broker (with delegated access) will have the ability to view the SOA on the CCP as well as receive a copy via EDI if opted.
- CARM will notify the importer and authorized customs broker when the SOA is available.
- The Customs Broker Summary Statement (CBSS) will replace the Customs Broker SOA and will include accounting summaries for all importers which the Customs Broker has submitted import declarations. The CBSS will NOT provide details on the payment amount due and due date as this will only be displayed on the importer’s account. The CBSS will provide a summarized view (count and amount) of import declarations and payment transactions per importer made in the billing period:
- New declarations (count and amount)
- Corrections submitted (count and amount)
- Adjustments submitted (count and amount)
- Adjustments submitted (count and amount)
- No account balance or payment requirements.
- Customs brokers will not be required to pay for any debt associated with import declarations submitted on behalf of an importer’s BN15. Customs brokers will not be responsible to settle the account balance or payment balance for import declarations submitted on behalf of the clients/importers.
- Although CBSA will be expecting payment of the Commercial Accounting Declaration (CAD) from the BN owner on the declaration, a customs broker can still choose to make payment on behalf of their client. The authorized customs broker will need to access the importer’s CCP account to determine the payment amount. Any payment that the customs broker makes on behalf of the importer will be applied to the importer’s account balance and not to individual transactions. For example, the CBSA will use payment allocation rules which means the oldest transactions on the importer’s account will be paid first.
- The Importer/Account Holder is responsible for paying any balances owing on their account.
It is important to stay on top of CARM. Let us help you to be prepared and answer any of your questions.