Our initial 60 minute consultation gives us a sense of who you are, what you have been doing, and what your risk exposure is in a sales tax audit. You will sit down with Sam or our senior legal team and, based on your risk assessment, we will build a plan for dealing with your audit. At the end of the strategy session, you walk out with a complete strategy and step-by-step game plan. You receive the benefit of our analysis, which is yours regardless or not you retain our firm. If you choose to move forward, we will handle the entire audit on your behalf from start to finish.
The purpose of the pre-audit is to "stress-test" our clients using the same methods and standards that the sales tax auditor will use when scrutinizing your return. We start with primary sources of information (the direct method of testing) and also analyze possible statistical analyses that the auditor may perform as well. This gives us the opportunity to not only test our hypothesis from the initial meeting, but to identify other risks and opportunities that may present themselves in the audit as well.
The next step, often done in tandem with our pre-audit, is to reach out to the auditor and negotiate your audit plan. The audit plan is a critical and often overlooked step in the California sales tax audit process because it sets the boundaries for the scope of the audit. It is like defining the rules of engagement and sets the tone for the audit. Often, because we have become familiar with the client's data, we can steer the direction of the audit early to our client's benefit, which has a significant impact on the results that we are able to achieve.
We present the audit on your behalf, walking the auditor through the process, from start to finish. Because of the pre-audit and the preparation that has been done in advance, we are able to anticipate any grievances or challenges that the auditor may have to the data that we are presenting and have put you into a much more advantageous position.
Although we would like to tell you that every California sales tax audit goes smoothly, this is often not the case. You can expect California to fight back against a no-change assessment. If you have made a mistake in your reporting, we can help you get through the audit with as little pain as possible. Our goal is to mitigate your exposure and risk in order to provide the most streamlined and positive outcome possible.
After some measure of back and forth with the auditor, we will see a preliminary audit report and have the opportunity to decide where we go next. If we like the result, then we are done. If we do not, we can work with the auditor and/or management in the auditor's district office, pursue settlement options, or go through the appeals process and litigate the outcome.
Through our experience in more than on hundred sales tax audits and 10+ years of experience in this area of law, we have learned that every audit follows a similar path, but with a slightly different approach based on who the client is. Our focus during the entire audit process though remains on what is best for you business. It is through our business-first approach though that we are able to achieve very beneficial results for our clients because we understand the 10,000 foot view of how the process works and how to navigate through it.
We designed this service for our business clients because we want to transform something that is unpredictable, potentially damaging, and, at times, painfully unfair into something that is manageable and easy to get through. Part of that process is managing your resources and preventing the sales tax auditor from turning your audit into a fishing exhibition. An equitable outcome comes down to making sure your time, money, and resources are properly preserved.