- 20 Marks
TAI – Aug 2020 – L1 – Q2 – Taxpayer File Review
Explain six key reasons for reviewing a taxpayer’s file before a field audit.
Question
(A) The tax auditor’s initial objective in pre-contact analysis is to collect relevant background materials and information to build a general picture of the taxpayer and its operations. Preparing for and obtaining the essential information about the taxpayer ensure that the audit is conducted efficiently and effectively.
Required: Enumerate and discuss six (6) key reasons why taxpayer’s file is reviewed prior to the field audit?
(B) Information from prior audit report and file may assist the auditor in his or her current exercise.
Required: Clearly outline and discuss any four (4) reasons why it is important to review the previous audit report or contact the previous tax auditor when preparing to undertake a current audit assignment.
(C) In the course of a tax audit, certain critical information on the audit should be communicated to the audit supervisor or manager as soon as the tax auditor took notice of them.
Required: Mention six (6) of such information that may require such action.
Find Related Questions by Tags, levels, etc.
- Tags: Audit Preparation, Compliance, Pre-contact Analysis, Tax Audit, Taxpayer File
- Level: Level 1
- Topic: Audit Planning and Strategy
- Series: AUGUST 2020
