1. Our Mission We are the guardians of our Nation’s borders. We are America’s frontline. We safeguard the American homeland at and beyond our borders. We protect the American public against terrorists and the instruments of terror. We steadfastly enforce the laws of the United States while fostering our nation’s economic security through lawful international trade and travel. We serve the American public with vigilance, integrity and professionalism. Our Mission We are the guardians of our Nation’s borders. We are America’s frontline. We safeguard the American homeland at and beyond our borders. We protect the American public against terrorists and the instruments of terror. We steadfastly enforce the laws of the United States while fostering our nation’s economic security through lawful international trade and travel. We serve the American public with vigilance, integrity and professionalism.

2. U.S. Customs and Border Protection Office of International Trade Partnership Programs Branch Presents *** Overview of the Importer Self-Assessment Program

3. This is a sample title.  Trade Vision  What is the Importer Self-Assessment Program?  Requirements for Participation  Benefits  Application Process  Internal Control  Risk Based Approach, Best Practice and ISA Stats Overview of Presentation

4. This is a sample title. A swift flow of legitimate imports entering the U.S. marketplace, free from harm to the U.S. economy and consumers, where: U.S. trade laws are enforced, with harmful and non-compliant cargo is intercepted & deterred. Legitimate imports are identified and rapidly admitted into commerce without disruption Compliant & secure trade is ensured & supported by mutually beneficial partnership Modernized processes and technology enable a streamlined import process Emerging risk are mitigated through the development of national trade policy Trade Vision

5. This is a sample title.Trade Volume and Trends In FY-11 Total Import Value totaled $2.267 Trillion – a 14% increase over FY 10 Estimated Duties totaled $29 Billion – a 16% increase over FY 10 Entry Summaries totaled 29.5 Million – a 10% increase over FY 10 Import ValueImport Value

6. This is a sample title. CBP partners with global industry to foster self-governance compliance programs, such as the Importer-Self Assessment (ISA) program, to help expedite the flow of legitimate shipments and achieve compliance with trade laws.  A partnership between CBP and importers to maintain a high level of trade compliance  A voluntary approach to trade compliance that allows importers to maximum control of their own CBP compliance.  Recognizes importers who are willing to assume responsibilities for self- assessment in exchange for less CBP oversight.  Built on knowledge, trust and a willingness to maintain an ongoing CBP/importer relationship.  The ISA program was announced by the Deputy Commissioner of U.S. Customs and Border Protection via General Notice in the Federal Register on June 17, 2002 (67 FR 41298). Importer Self-Assessment

7. This is a sample title. Pre-requisite:  U.S. resident importer (decentralized and physically located in the U.S.) with at least two years of importing history  Current member of C-TPAT Complete an ISA application and agree to:  Comply with all applicable Customs laws and regulations  Develop, document and implement internal controls  Perform self testing based on risk assessment  Submit an annual notification letter to include required information. Requirements for Participation

8. This is a sample title.  Make appropriate adjustments to internal controls  Maintain an audit trail from financial records to import documents  Make appropriate disclosures  Provide annual notification of continued commitment  Conduct self-testing and maintain results for three years  Comply with stipulations outlined in the MOU. Requirements for Participation

9. This is a sample title.  Exemption from comprehensive audits  Focused Assessments  Drawback and Foreign Trade Zone audits (if included in ISA application)  Less CBP intrusion  Reduced cargo exams  Faster clearance  Less post release inquires (CF-28, CF-29)  Coverage available for multiple business units  Greater business certainty  More accurate data  Company control over the process ISA Benefits

10. This is a sample title.  Enhanced Prior Disclosure  If CBP becomes aware of errors in which there is an indication of a violation of 19 U.S.C. 1592 or 1593a, CBP will provide a written notice to the importer of such errors and allow 30 days from the date of the notification for the importer to file a prior disclosure pursuant to 19 CFR 162.74  This benefit does not apply if the matter is already the subject of an ongoing CBP investigation or fraud is involved  Participation can be considered as a mitigating factor in cases of penalties or liquidated damages  National Account Manager  Proactive action  Reports with analysis  Intervention in the event of issue  Makes calls to ports to resolve issues  Familiar with your company ISA Benefits

11. This is a sample title.  Company submits ISA Application  Memorandum of Understanding  Policies & Procedures Manual  Questionnaire (with support documents)  Application Review Meeting (ARM)  Consultation  Collaborative effort between company and CBP  Trade Data (ITRAC) – Import transactions for 5 yr period  Company demonstrates readiness for program participation  Company presents its self-testing plan Application Process

12. This is a sample title. The objective of an ISA Application Review Meeting (ARM) is to assess the applicant's readiness to assume the responsibilities of the ISA program through an evaluation of its internal control for achieving compliance with CBP laws and regulations. Objective of the ARM

13. This is a sample title.  Usually 2-Day Visit  Presentation from CBP  ISA history and background information  Importer Trade Activity (I-TRAC) Data  Presentation from Importer  Demonstrate the areas using the 5 Components of Effective Internal Controls  Review of automated systems  Walk-through sample transactions (purchase order to payment)  Explain ISA Self-Testing Plan  Tour (Optional) Application Review Meeting

14. This is a sample title. Demonstrate ISA Readiness  Ensure system of internal control for Customs objectives encompass the 5 components of internal control  Illustrate self-test plan based on risk  Obtain documentation on each of the walk-through entries (from purchase order – to proof of payment) Applicant’s Presentation to CBP

15. This is a sample title. ISA Review Board  Representative from the Offices of International Trade, Field Operations, Immigration and Customs Enforcement, and Regulations and Rulings.  Makes determination to accept applicant into the ISA program.  If ISA Ready  CBP/Assistant Commissioner co-signs MOU  ISA Plaque and acceptance letter sent to applicant  Benefits begin Application Approval Process

16. This is a sample title. Annual Notification Letter (ANL) Due 13 months from the date of the ISA acceptance and every 12 months thereafter.  The ANL must include:  Summary of self-testing results and corrective actions taken  Changes to their internal controls based on test results and identified risk  Changes in the organization structure (e.g., customs compliance dept, ownership, acquisitions, Divestures, etc.) and/or personnel  Changes in import processes  Special Trade Program's  Disclosures, Post entry amendments Post Acceptance Requirements

17. This is a sample title. ISA participants are expected to:  Identify risk as it relates to CBP transactions  Conduct self-testing based on identified risk factors  Take action to mitigate risk and report non-compliance to CBP  Continuously assess internal control to determine if they are sufficient, effective, and are working a intended Post Acceptance Requirements

18. This is a sample title. Internal Control is a…  continuous built-in process that provides reasonable assurance and is affected by people  process affected by the company board of directors, management and other personnel that is designed to provide reasonable assurance that specific objectives are met. What is Internal Control?

19. This is a sample title. Resources are directed, monitored and measured to prevent and detect fraud and misuse of resources.  Reliability of reported data  Effectiveness and efficiency of operations  Compliance with applicable laws and regulations  Feedback on the achievement of operational & strategic goals Internal Controls Objectives

20. This is a sample title. 1. Control Environment 2. Risk Assessment 3. Control Activities 4. Information & Communication 5. Monitoring System of Internal Control 5 Components

21. This is a sample title.  Control Environment-The control environment sets the tone of an organization, influencing the control consciousness of its people  Risk Assessment–Every entity faces a variety of risks from external and internal sources that must be assessed both at the entity and the activity level  Control Activities–These policies and procedures help ensure management directives are carried out  Information and Communication– Pertinent information must be identified, captured and communicated in a form and timeframe that supports all other control components  Monitoring–Internal control systems need to be monitored –a process that assesses the quality of the system’s performance over time COSO Framework Committee of Sponsoring Organizations of the Treadway Commission (COSO)

22. This is a sample title. Establishes a foundation of internal control system by providing fundamental discipline and structure.  It recognizes that unexpected as well as expected events may occur.  Establishes the entity’s risk culture.  Considers all other aspects of how the organization’s actions may affect its risk culture. Internal Controls Control Environment

23. This is a sample title. Allows an entity to understand the extent to which potential events might impact objectives.  Assesses risks from two perspectives: - Likelihood - Impact/Significance  Assesses risk on both an inherent and a residual basis.  Is used to assess risks and is normally also used to measure the related objectives.  Establishes a foundation of internal control system by providing fundamental discipline and structure.  It recognizes that unexpected as well as expected events may occur.  Establishes the entity’s risk culture.  Considers all other aspects of how the organization’s actions may affect its risk culture. Internal Controls Risk Assessment

24. This is a sample title. Management’s policies, procedures & practices are applied to ensure company objectives are met, protect assets, and can measure performance  Managements review of actual performance  Establishment and review of performance measures and indicators  Proper execution of transactions  Appropriate documentation of transactions  Controls over information processing  Segregation of duties Internal Controls Control Activities

25. This is a sample title. Supports other control components by communicating control responsibilities to management and others. Ensures pertinent information is identified, captured and distributed:  to the right people,  in sufficient detail,  in the correct form, and  in a time frame that allows people to carryout out their duties. Internal Controls Information & Communication

26. This is a sample title. External oversight of internal controls by management or other parties outside the process or applied by independent methodologies like use of internal checklist by employees within the process. Use those elements to define the control objective to be audited, assess the components, and report the results to management.  Ensure that controls are adequately designed and working  Ensures appropriate criteria are considered in the review  Provides a trail to support conclusions reached. Internal Controls Monitoring

27. This is a sample title.  Are internal controls formally documented?  Are written policies and procedures approved by management?  Are policies and procedures reviewed and periodically updated?  Are internal controls periodically tested and results documented and corrective action taken?  Does company identify, analyze and manage risk related to CBP transactions? Risk Based Approach Evaluate Your Controls

28. This is a sample title.  Conduct a risk assessment and identify risk areas  Determine how many transactions to test and how often  Determine who will conduct the test  Document test results  Determine corrective action (if necessary) Develop a Self-Testing Plan

29. This is a sample title. 1.Managements Commitment 2.Create a Customs Compliance Group 3.Conduct Ongoing Risk Assessment 4.Develop and Implement Formal Policies/Procedures 5.Establish Ongoing Training Programs 6.Attend Trade Conferences/Seminar 7.Monitoring of System of Internal Control 8.Access to Executives for Needed Resources 9.Develop Compliance Requirements for Suppliers 10.Partner with CBP on other trade programs Best Practices for ISA Readiness

30. This is a sample title.ISA Value (FY-2012)

31. This is a sample title.ISA Members By Industry (FY-2012)

32. This is a sample title. For More Information Contact: Florence Constant Chief, Partnership Programs Branch florence.constant@dhs.gov (202) 863-6537 Office of International Trade Partnership Programs