1 Fundamentals of IRP / IFTA Audits Audit Reports, Closing Conference & Audit File Presented by: Diana Kay (FL) Stacey Hammock (WY) Audit Reports • IRP – The Plan 1055; Audit Procedures Manual (APM) 601 • IFTA – Agreement (R)1370; Audit Manual A460 • IFTA/IRP Combined Audit Reports Who/What/When • Who receives the audit report • What must the audit report contain • When do we provide the audit report • Reexaminations and Appeals
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Transcript
1
Fundamentals of IRP / IFTA Audits
Audit Reports,Closing Conference
& Audit File
Presented by:
Diana Kay (FL) Stacey Hammock (WY)
Audit Reports
• IRP – The Plan 1055; Audit Procedures Manual (APM) 601
• IFTA – Agreement (R)1370; Audit Manual A460
• IFTA/IRP Combined Audit Reports
Who/What/When
• Who receives the audit report
• What must the audit report contain
• When do we provide the audit report
• Reexaminations and Appeals
2
Registrant/General Information
• Name of base jurisdiction
• Auditor’s name
• Date report issued (IRP)
• Carrier Contact Information:
– Name
– Address
– Phone (IFTA says, where required)
– Representative
– Account Number
Registrant/General Information (Cont’d)
• Fleet number (IFTA says, where applicable)
• USDOT number (where required)
• Audit period (IFTA)
• Registration year(s) audited (IRP)
• Reporting period audited (IRP)
Registrant/General Information (Cont’d)
• Number of vehicles apportioned (IRP)
• Summary of business operations
• Any trends and variances (IRP adds unusual)
3
Evaluation of Internal Controls
• Reliability
• Strengths and weaknesses
• Changes
Opening Conference
• Provide the date and persons attending (IRP)
• Provide opening and closing conference dates and attendees or reason why, if not held (IFTA)
Sampling Methodology
• Describe sampling methodology OR
• Reason sampling was not performed
• Note the periods and vehicles sampled
4
Distance/Fuel Examination
• Identify the source documents
• Identify the information in those documents
• Describe the procedures used to verify– reported distance
– reported fuel
– MPG/KPL
Distance/Fuel Examination
• What methodology was used to allocate any unreported distance (IRP)
• Explain the distance and fuel adjustments
• Are there any discrepancies between– summaries and IFTA returns
– summaries and IRP renewal application
• Were any vehicles removed from the fleet and assessed full plate fees (IRP)
• Are the records adequate or inadequate?
Closing Conference and Recommendations
• When & who attended
• If not held, why (IFTA)
• Recommend changes necessary to comply
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Summary
Describe:
• the audit procedures
• findings
• additional information deemed necessary
Billing Summary - IRP
• Reported distance traveled
• Reported percentage• Reported fees
• Audited distance traveled
• Audited percentage
• Audited fees
• Percent change
• Net fees due• Net fees owed by or due to the registrant
The following information is required, by jurisdiction
Billing Summary - IFTA
• Total net distance adjustment
• Net distance adjustment by jurisdiction
• Net tax paid fuel purchases adjustment
• Reported MPG/KPL
• Audited MPG/KPL
• Net fuel tax adjustment per jurisdiction
6
Billing Summary – IFTA (Cont’d)
• Reported tax by jurisdiction• Audited tax by jurisdiction
• Penalty
• Interest by jurisdiction• Total by jurisdiction
Friendly Reminders
• Use proper grammar & spell check
• Write in a clear and concise manner that is easy to understand
• Ensure the taxpayer’s personal info is accurate and correctly spelled
Closing / Exit Conference
IRP – APM 404
• If not held, reasons must be documented in the audit file
IFTA – A460.300
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• There should be no surprises or controversy at this stage of the audit
• Inform the carrier of problem areas as the audit progresses
Closing / Exit Conference
Schedule as far in advance as possible
Have a presentation outlinea) cover important itemsb) highlight strong and weak
areas
Ensure the carrier understandsa) how the audit was performed;b) how the sample results were
applied
Closing / Exit Conference
Listen to the carrier's questions and comments
Be open to additional information
Provide the applicable statutes / regulationsa) Fair treatmentb) Determines the requirements
Closing / Exit Conference
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Review the report OR advise what to expect
Rights of appeal
Are the results subject to change?
Closing / Exit Conference
Do…
Be prepared, confident, patient and courteous Be professional, while friendly and helpful Communicate effectively and accurately Encourage feedback Be open to new information Discuss recommendations Provide samples
(IVDR’s, summaries, etc.)
Do’s & Don’ts
Don’t…
Be confrontational
Be in a hurry
Talk down to the taxpayer
Do’s & Don’ts
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Audit File
• Evidence of planning and supervision – APM 203(b); A230• Deviations from the jurisdiction’s audit program – APM 205