“Management is above all, a practice where art, science, and craft meet” – Henry Mintzberg.

Understanding Audits in Management

A tax audit is an examination to ensure that a taxpayer has accurately assessed and reported their tax liability and met other obligations. Tax audits are often more detailed and extensive than other forms of examination, such as general desk checks, compliance reviews, or document matching programs.

An audit analyzes issues deemed crucial for an accurate assessment of a taxpayer’s tax liability. Typically, these issues include any signs of significant unreported income (e.g., an unusually low net income ratio) or potentially overstated deduction items that may be evident from a taxpayer’s return and other information, including supporting documents.

Properly managing a tax audit is essential for every organization, and here’s why:

1. Maintained Records: A tax audit ensures that income and expense records are kept properly, avoiding last-minute panic.
2. Accuracy in Reporting: It guarantees that total income and claims for deductions are entered accurately and correctly by the finance specialist.
3. Fraud Prevention: Proper audits minimize the chances of fraudulent practices.
4. Financial Benefits: Audits facilitate advice that can offer substantial financial benefits to a business.
5. Credibility: Audits add credibility to published information for employees, customers, suppliers, investors, and tax authorities.
6. Shareholder Assurance: They provide assurance to shareholders that the financial figures present a true and fair view.
7. Reputation Enhancement: Audits improve the company’s reputation, as government authorities accept audited statements as true and fair for taxation purposes.

In Conclusion,

At Inner Konsult, we leverage available organizational models, policies, processes, and technologies to offer dynamic and objective tax audit management. We explore, assess, prioritize, and implement improvement opportunities, resulting in process efficiency, cost and time savings, and more effective resource allocation. With us, you gain additional time to focus on creating value while we handle the tax-related challenges, ensuring the sustainable health of your economic unit.

For professional advice on Accountancy, Transfer Pricing, Tax, Assurance, Outsourcing, online accounting support, Company Registration, and CAC matters, please contact Inner Konsult Ltd at www.innerkonsult.com at Lagos, Ogun state Nigeria offices, or www.sunmoladavid.com. You can also reach us via WhatsApp at +2348038460036.