FinanceRegs.com » Why audits are getting scarier

Why audits are getting scarier

March 20, 2008 by Carol Katarsky
Posted in: Best practices, Latest news & views, Sales and use tax, Tax compliance

Fully 88% of companies are worried about their next sales tax audit. Here’s why:

Due to the economic doom and gloom, state (and city) budget shortfalls are getting more widespread — and far worse than expected.

When states are pressed for cash, they tend to ramp up enforcement of existing taxes to make sure they get their hooks on every penny they can. Which means you can expect state auditors to not only do more audits, but to be a lot more rigorous in their work.

Don’t take our word for it: According to a survey by the sales tax experts at Sabrix, 60 % of companies are already reviewing their internal procedures to make sure they’re complying with the letter of the law.

Once you’ve got year-end wrapped up, consider doing a mini-audit of your company’s sales tax procedures. If you have any surprises lurking in your books, you’ll be better off if you address them now — not after the auditor has already been in touch.

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