There are a couple possible outcomes. Number one is that the auditor's report is sufficient and that you agree with it. If you agree with it, there will be a short exit conference between you, the auditor and the manager so the auditor can explain what they did in the report. If you don't agree with the audit then this conference happens anyway but at least that will give you the opportunity to express your disagreements in front of the manager and have the auditor potentially make changes. Now the problem with this is is the auditor at this point has usually already run the audit report by the manager and anticipated any disagreements that you might have with it so the manager is less likely to stand up for you than you would think but there are opportunities there to present any additional documentation or any other fact-finding before the close of the audit. If you're not successful with resolving things with the manager, then the auditor will issue you a bill. They will turn in the audit and a bill will be generated about two to three months later and then when you receive that bill, you can file a petition for redetermination. Upon filing your petition for redetermination, you will proceed to a 10-day conference. We will have the opportunity to speak with the head of the audit unit for that particular.

Preceding your 10-day conference with the district principal auditor, the manager and the auditor have already briefed the district as to the audit and as to any contentions that you may be making so don't expect an entirely warm and friendly reception from the district principal auditor. With that said, when it rises to the district principal auditor level, it can be a place for negotiation, particularly if it will terminate your appeal. If you're unsuccessful at resolving things at the district level, then you have two options at that point. Number one you can go to CDTFA appeals and go through the appeals process where you can proceed to CDTFA settlement and try and settle the process after going through Appeals. If you still disagree with the appeals officer's decision you can proceed your case to the office of tax appeals and litigate. The goal is to resolve the audit at the earliest possible level in order to minimize the risk and the cost for you and your company.