Auditing CAD/B3 entries after accounting: what to check line by line

What does a post-entry audit of a CAD actually check?

A post-entry audit takes Canadian entries that have already been accounted for and paid, and checks each line against the rules that applied to that shipment. Since CARM became the CBSA's system of record on October 21, 2024, commercial goods are accounted for on the Commercial Accounting Declaration (CAD/B3), which replaced both the B3 coding form and the B2 adjustment request (CBSA Memorandum D17-2-1). Older entries are still B3s, and the checks below are the same for both.

The CAD matters more than the invoice. CBSA Memorandum D17-1-5 calls it "the official invoice" and says all corrections, adjustments, audits and appeals "are based on the data submitted on this document". If the CAD line is wrong, the duty is wrong, whatever the invoice says.

Every line carries the same set of declarations, and each one can be wrong in a way that costs you money or owes CBSA money:

The rest of this page walks through each row: what to look at, where it goes wrong, and what the law says.

Why audit from the broker's full accounting export instead of a sample?

Sampling works for estimating an error rate. It fails as a way to find and fix errors, for three reasons that are specific to Canadian rules.

First, the obligation is per declaration. Section 32.2 of the Customs Act requires you to correct each incorrect declaration of origin, tariff classification or value for duty. CBSA Memorandum D11-6-6 adds that corrections for "same and similar goods" and goods affected by the same issue must also be made within the 90 days. Finding the problem on one sampled line obliges you to fix every other line with the same problem. You cannot do that without the full set.

Second, errors repeat. A wrong tariff item in the broker's product file, a missing surtax flag or a stale exchange-rate rule hits every shipment of that product until someone changes it. Where the CBSA reports results of its targeted verifications, the error rates are high: on its trade compliance verification page, the CBSA reports 152 of 202 closed cases in error for the priority on the United States Surtax Order (2025-1), an order since repealed, and 25 of 28 closed cases in error for the third round of its bags classification priority.

Third, the refund side needs the full set too. A refund under section 74 is filed per CAD and needs supporting documents. Overpayments sit on lines a sample would skip.

The practical source is the accounting export your customs broker can produce for a period: every CAD, every line, with tariff item, tariff treatment, value for duty, duties, surtax, SIMA and GST. Pair it with the commercial invoices and you have both sides of each line.

Is the tariff classification right for the goods and the date?

Classification drives everything else on the line: the duty rate, whether a surtax order covers the good, whether SIMA applies and whether the line falls under a quota. Check three things.

1. Does the tariff item describe the goods? Compare the invoice description and product literature with the heading and the item. CBSA verification priorities are largely classification problems where similar goods sit in very different items. For frozen desserts, the CBSA says goods may be classified under tariff item 2105.00.10 instead of 2105.00.92, where rates reach 277%. For gloves, goods under headings 39.26 and 42.03 may belong in Chapters 61 or 62.
2. Was the item valid on the entry date? Tariff items are amended. A line coded to an item that changed before the release date is an error even if the goods did not change.
3. Is the same product classified the same way on every entry? Two tariff items for one part number across a year of entries means at least one set of lines is wrong.

A wrong item can go either way. If the right item carries a higher rate, you owe a correction under section 32.2(2). If it carries a lower rate, you can claim a refund under section 74(1)(e) within four years. You can check the rate on any tariff item, for any origin and date, in the free duty calculator.

Was the right tariff treatment claimed, and can you prove origin?

Tariff treatment is the rate column the line was entered under: Most-Favoured-Nation, General Tariff, CUSMA, or one of Canada's other trade agreements. Two opposite errors are common.

A preference that was available but not claimed. Goods that qualified for CUSMA, CETA, CPTPP or another agreement were entered at the MFN rate, often because the certification of origin arrived late. That is an overpayment. Section 74(1)(c.11) of the Customs Act allows a refund for goods from a country in Part 4 of the Act's schedule, which lists CUSMA countries alongside the other agreement partners, and section 74(3)(b)(i) gives four years from accounting. The CBSA's CUSMA guidance confirms that four-year window for CUSMA claims.

A preference that was claimed without support. The CBSA's CUSMA guidance says importers "must have in their possession the CUSMA certification of origin" when they claim the preference. A claim made without it, or on goods that do not meet the rule of origin, is an incorrect declaration of origin. Section 32.2(1) requires a correction within 90 days of having reason to believe it is wrong. Exporters cancelling certificates of origin is one of the triggers CBSA Memorandum D11-6-6 lists.

What to check on each line:

• The tariff treatment code against the country of origin on the invoice.
• For every preferential line, a certification or proof of origin dated on or before the claim, kept on file.
• For every MFN line from an agreement country, whether the goods would have qualified. These lines are the refund candidates.

Origin also matters on lines with no preference at all, because surtax orders apply by origin. That is covered below.

Is the value for duty right, in Canadian dollars?

Value for duty is the base for the duty, the surtax and, with the duties added, the GST. Errors here move every number on the line.

Currency conversion. CBSA Memorandum D13-2-3 says the value is converted at "the Bank of Canada rate prevailing on the date of direct shipment of the goods to Canada". Brokers sometimes use the release date or the invoice date instead. On a large line in a month when the dollar moved, the difference is real money, in either direction. Check the rate on each line against the date of direct shipment shown on the bill of lading or other transport document.

Price adjustments. Retroactive price increases from a supplier are a listed trigger in D11-6-6: they make the declared value wrong and start the 90-day clock. Price reductions run the other way and can support a refund.

What the price leaves out. Assists, royalties and licence fees, and selling commissions paid by the buyer can belong in the value even though they are not on the commercial invoice. Compare the invoice total with the purchase order, the payment records and any separate agreements.

Invoice to CAD. The simplest check is still the most productive: does the value on each CAD line match the invoice line it came from, after conversion? Lines get merged, split and keyed by hand, and the totals drift.

Do quantity and unit match the tariff and the invoice?

Each tariff item has a unit of measure, and specific rates, quotas and SIMA amounts are calculated on quantity. Check that the CAD quantity matches the invoice and packing list, that it is in the unit the tariff item requires, and that split shipments add up to what arrived.

A shortage is an overpayment: section 74(1)(b) allows a refund where the quantity released is less than the quantity duties were paid on. An overstated quantity on a line with a specific rate is the same story. Memorandum D17-2-1 shows a worked example in which one CAD line of mattresses is split in two with the reason code for a quantity change, and one half is then reclassified.

Are surtaxes on the line, and should they be?

Canada imposes surtaxes by order in council, on top of customs duty and calculated on value for duty. Several orders have been made, amended and remitted since 2024, and the CBSA lists the ones it is verifying: the United States Surtax Order (2025-1), repealed with its surtaxes ending on September 1, 2025 but still checked on entries made while it applied, the United States Surtax Order (Steel and Aluminum 2025), the United States Surtax Order (Motor Vehicles 2025), the China Surtax Order (2024) for electric vehicles and for steel and aluminum, the Steel Goods and Aluminum Goods Surtax Order, the Steel Derivative Goods Surtax Order and the order imposing a surtax on certain steel goods over quota (trade compliance verification).

The most recent is the United States Surtax Order (2026), effective September 8, 2026. CBSA Customs Notice 26-23 sets out how it works:

• Rates of 15%, 25% or 50%, depending on which schedule of the order the good falls under, declared with surtax codes 26186A, 26186B or 26186C in the surtax field of the CAD.
• The surtax applies to goods eligible to be marked as US goods, regardless of the country they are exported from.
• The surtax is charged in addition to any other duties, so a line can carry a 0% CUSMA duty rate and a 25% surtax. Relief does not come through the tariff treatment on the line. The notice points to the Duties Relief and Duty Drawback programs, which relieve goods later exported or used in exported goods where the CUSMA criteria are met, and to remission under the United States Surtax Remission Order (2025), which the 2026 order extends, or the government's remission framework.
• The surtax and the Steel Derivative Goods Surtax Order are not cumulative; where a good falls under both, only the US order applies.
• GST is calculated on a value that includes the surtax, "even when customs duties are remitted".

What to check on each line: the origin, the tariff item, whether the item is in a schedule of an order in force on the entry date, whether an exception or remission applies, and whether the surtax amount equals the rate times the value for duty. Then check the other direction: lines that carry a surtax but are not of covered origin, or not in a schedule, are refund candidates under section 74(1)(g), and Memorandum D17-2-1 lists reason codes for surtax paid in error.

The CBSA's reported verification results show where this goes wrong. For the United States Surtax Order (Steel and Aluminum 2025), it reports 20 of 29 closed cases in error; for the China Surtax Order (2024) on steel and aluminum, 102 of 171.

A worked line

The figures here are illustrative, chosen to be round. An article of US origin, not made of steel or aluminum, is invoiced at USD 40,000. For this example it falls in Schedule 2 of the United States Surtax Order (2026), and it qualifies for CUSMA.

The line holds two errors pulling in opposite directions. The exchange rate overstated the value by CAD 800. With a 0% duty rate that only overpaid CAD 40 of GST here, but on a dutiable line, or one carrying a surtax, the same rate error inflates every amount calculated on the value. The missing surtax is an underpayment of CAD 14,000, plus 5% GST on it. That amount is owed with interest, and Memorandum D17-2-1 lists reason codes for assessing surtax on an adjustment. CBSA Memorandum D16-1-1 says an importer who identifies that surtax is payable "must submit a self-adjustment" and declare the surtax code. [OWNER REVIEW: does a surtax left off a line whose origin and tariff item were declared correctly also run on the 90-day clock in s.32.2, which names only origin, tariff classification and value for duty? D16-1-1 makes the self-adjustment mandatory but sets no deadline of its own. If the origin or tariff item was wrong, s.32.2 clearly applies. Counsel to confirm.]

Keep the overpayment separate. Section 32.2(5) does not allow a correction that results in a refund, so the exchange-rate error is claimed as a refund under section 74; CBSA Memorandum D6-2-3 lists exchange-rate errors among the errors covered by paragraph 74(1)(d). The full mechanics are in correcting a Canadian entry.

Is the line exposed to SIMA duties?

The Special Import Measures Act (SIMA) imposes anti-dumping and countervailing duties on specific goods from specific countries. The CBSA's measures in force list names each case, the countries and the usual tariff items, from fasteners and mattresses to aluminum extrusions, cold-rolled steel, gypsum board and refined sugar.

SIMA is unforgiving because the duty depends on the exporter, not only the product. On the fasteners case, an exporter with its own normal values pays duty based on those values, while for goods from exporters without them "the anti-dumping duty is equal to 170% of the export price". The CBSA also says importers remain responsible for checking that the amounts assessed are correct.

What to check: every line whose tariff item and origin match a measure in force, whether the goods fall within the product definition, which exporter shipped them, and whether the declared SIMA duty uses that exporter's normal value or the default. A missing SIMA duty is a large underpayment. A default rate applied to an exporter that had its own normal value is a large overpayment. SIMA errors do not go through an ordinary CAD adjustment: Memorandum D17-2-1 sends them to a re-determination request through the CARM Client Portal, covered in correcting a Canadian entry.

Are TRQ goods inside or outside the quota?

Some goods carry a tariff-rate quota: a lower rate up to a quantity and a much higher rate beyond it. For supply-managed agricultural goods such as dairy and poultry, CBSA Memorandum D10-18-1 explains that goods may be classified under a "within access commitment" tariff item only when imported under an import permit issued under the Export and Import Permits Act, in compliance with its conditions. Without that, the over-access item and its rate apply.

For steel, the quota works through a surtax: the CBSA's verification priority on the order imposing a surtax on certain steel goods describes a 50% surtax that was not applied where imported volumes exceeded the quota.

What to check: every line under a within-access item is covered by an import permit (specific or general) whose conditions it meets, and every steel line under a quota order is checked against the quota status on its entry date. Spent fowl is a current CBSA priority because goods may be classified as spent fowl instead of under quota items with very high rates; the CBSA reports CAD 196,004,072 in assessed revenue from that priority on its verification page.

Is the GST right?

GST on imports is charged on a value that includes the duties. Section 215 of the Excise Tax Act sets that value as the customs value plus the duties and taxes payable under the Customs Tariff, SIMA and other customs laws. The CBSA's own worked example applies 5% GST to the value for duty plus duty.

Two errors recur. The GST base leaves out a surtax or SIMA duty that was added later, so the GST is short. Or a GST exemption code is used on goods that do not qualify; GST exemption codes are a CBSA compliance priority. Memorandum D11-6-6 confirms that GST status errors are also corrected under section 32.2. On the refund side, D17-2-1 says the CBSA decides GST refund requests but does not credit them to the importer's account: GST registrants recover the amount as an input tax credit from the Canada Revenue Agency.

Where do overpayment and underpayment usually hide?

From the checks above, the patterns are predictable.

Overpayments tend to sit in:

• MFN lines on goods that qualified for CUSMA or another agreement, where the proof of origin arrived after accounting.
• Surtax charged on goods outside the order's schedules, of non-covered origin, or covered by a remission.
• SIMA default rates on goods from an exporter that had its own normal values.
• Exchange rates taken on the wrong date in a month when the dollar weakened.
• Short shipments paid in full.

Underpayments tend to sit in:

• Surtax missing on goods that entered in the weeks after an order took effect or changed schedules.
• Preferential claims without a certification of origin on file.
• Retroactive price increases from suppliers.
• Within-access rates on quota goods without a permit.
• GST bases that leave out a surtax.

Audit both directions in the same pass. The overpayments pay for the work, and the underpayments in origin, classification and value are the ones with a 90-day deadline.

When does finding an underpayment start a 90-day clock?

This is the part of Canadian post-entry work that has no US equivalent in shape. Section 32.2(2) of the Customs Act requires an importer to correct a declaration of origin, tariff classification or value for duty "within ninety days after" having reason to believe it is incorrect, and to pay the duties and interest owing. Section 32.2(1) does the same for preferential origin claims. The obligation ends four years after the goods are accounted for (s.32.2(4)).

Memorandum D11-6-6 defines reason to believe as specific information that a declaration is wrong, and lists the sources: CBSA rulings and verification reports addressed to you, tribunal and court decisions involving you, information from your exporters or suppliers, a cancelled certificate of origin, a retroactive price change, and legislative provisions that are plainly clear. It also lists the final report of an audit you commissioned yourself, provided you had no earlier reason to believe, CBSA had not started a verification, and the report identifies only corrections that are revenue neutral or owed to the CBSA.

Two consequences follow.

1. Your audit can start the clock. The day an audit identifies an underpayment with specific information is a likely reason-to-believe date. Plan the corrections before the report is final, so the 90 days are spent filing, not deciding.
2. Not knowing is not the same as not having reason to believe. If the specific information existed earlier, CBSA can treat the earlier date as the start, and the correction goes back to that date, up to four years (Memorandum D11-6-10).

Missing the 90 days has a price. The CBSA's penalty system lists contraventions C350 to C353 for failing to pay the duties owed from a required correction of origin, classification or value for duty within 90 days, and C080 to C083 where the correction would not change the duties. Both sets carry a first-level penalty of CAD 500 per issue or occurrence, with caps that rise with repeat findings. Interest on amounts owing runs at the specified rate, which section 2 of the Customs Act sets at the prescribed rate plus 6% a year. Late corrections can still qualify for relief under the CBSA's voluntary disclosure rules; CBSA trade compliance verifications covers how that interacts with a verification.

How do you run the audit on your own entries?

1. Get the full accounting export. Ask your customs broker for every CAD and B3 accounted for in the period, with line-level tariff item, tariff treatment, origin, value for duty, exchange rate, duties, surtax, SIMA and GST. Four years is the useful window, because that is how long both the correction obligation and most refund rights run.
2. Gather the documents behind each line. Commercial invoices, packing lists, transport documents showing the date of direct shipment, certifications of origin, import permits and supplier price adjustments. The Imported Goods Records Regulations already require you to keep them for six years.
3. Pair every CAD line with its invoice line. Value, quantity and description should agree after conversion. Lines that cannot be paired are findings in their own right.
4. Run each check on this page against every line, using the measures in force on that entry's date: classification, tariff treatment and proof, value and exchange rate, quantity and unit, surtax, SIMA, quota and GST.
5. Sort findings by direction and route. Underpayments go to a section 32.2 correction within 90 days. Overpayments go to a section 74 refund within its time limit. SIMA issues go to a re-determination request.
6. Fix the source. Update the product file, origin records and exchange-rate rule your broker uses, so the next month's entries do not repeat the error.
7. File through your broker or your own CARM account, with the corrected values and supporting documents, and keep the audit report with the corrections.

TariffSense reads CAD/B3 lines, broker entry exports and invoices in any format, checks each line against the tariff measures in force on its entry date (tariff treatment, surtaxes and SIMA included), and returns each finding with the reason and the corrected value, for overpayments and underpayments alike. Filing the correction or refund stays with your broker or your own filer. The post-entry audit page shows what goes in and what comes back. If you audit US entries as well, the same line-by-line approach for Form 7501 is in the US post-entry audit guide.

What should you do next on your own entries?

Ask your broker this week for the full accounting export for the last four years, and check the surtax and tariff treatment columns first: those are where the CBSA's own verification results show the most errors, and where both refunds and 90-day corrections are most likely. Before filing anything, confirm the route and the deadline for your situation with a licensed customs broker or trade counsel.