Audit System Manual graphic

[ Audit System Manual- TOC ] [ Ch 1 - Introduction ] [ Ch 2 - Preparing for an Audit ] [ Ch 3 - Conducting the Audit ] [ Ch 4 - Completing the Audit Forms and Schedules ] [ Ch 5 - Audit System Screens ] [ Ch 6 - Miscellaneous ] [ Ch 7 - USDOL - Tax Performance System ] [ Ch 8 - Computer Fundamentals & Hardware ] [ Appendix ]
[ 1.1 - Objectives of a Field Audit Prg ] [ 1.2 - Definition of a Field Audit ] [ 1.3 - Purpose of an Audit ] [ 1.4 - Authority to Review Records ] [ 1.5 - Classification of Audits ] [ 1.6 - Audit Scope ] [ 1.7 - Required Audit Scope ] [ 1.8 - Tolerance/Expanding the Audit ] [ 1.9 - Audit Quota ] [ 1.10 - Audit Selection ] [ 1.11 - Audit Assignment Control ][ 1.12 - Components of a Completed Audit ] [1.13 - Review Process for Audits] [ 1.14 - Audit Retention ]

Chapter 1:    Introduction

comments to: Tax Department

1.12    Components of a Completed Audit

A completed audit includes a written report of findings and conclusions, along with any documentation or evidence that supports the findings and conclusions in the report.

Audit reports must contain sufficient information to show:

  1. The name and title of the individual with whom the purpose of the audit was discussed prior to the audit. When an employer designates a representative, the name and title of the authorizing employer and the designated representative must be recorded.

  2. How the existence of the business was verified.

  3. How the ownership was verified.

  4. What payroll record tests were performed, and what evidence was gathered to verify the accuracy and completeness of payroll, including,
  1. Verification of the payroll posting system.

  2. Reconciliation of total payroll to total wages.

  3. Computation of total taxable payroll.

  4. Reconciliation of verified total taxable payroll to reported total taxable wages.
  1. What other employer records were available and examined and what evidence was gathered in the search for misclassified workers and hidden wages, including,
  1. Contract labor records.

  2. Cash disbursements.

  3. General Ledger and Detailed General Ledger.

  4. Miscellaneous reports and records.
  1. Name, title, and telephone number of the individual with whom a closeout meeting was held.

  2. The number of quarters audited.

  3. That all monies due were collected and, if not, an explanation was provided.

  4. That all necessary adjustment forms were completed and submitted.

Note: The Tax Performance System Reviewer looks to see that adjustments are posted to the wage record system, however it is not the Auditor's responsibility to ensure they are posted.

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Last Revision: May 05, 2011