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About computer tax audit

How we operate

We conduct computer audits as part of investigations carried out by other Inland Revenue audit staff. The investigation team initially liaises between us and the taxpayer, and they take any follow-up action.

Confidentiality

We take the security of your data very seriously.

  • There are physical and "access control" security measures for data in electronic form
  • We constantly review new security products.
  • Legislation imposes strict secrecy obligations on Inland Revenue staff and others who handle information on the affairs of any person.
  • The normal confidentiality provisions explained in Inland Revenue audits (IR297) extend to computer-based information.

Types of computer tax audit services

We carry out three main types of audit work, which can be applied to any size of computer system, from PC to mainframe.

Systems audit

This is a detailed analysis of a system from data entry through to posting in the financial accounts. After documenting the system, we evaluate controls and weaknesses from a tax perspective and discuss our findings with you. We may request data in order to test some of the findings.

General ledger/data download

We get your financial information in electronic format and convert it into a format that can be used by the investigator doing the audit.

File interrogation

We analyse electronically stored accounting data using commercially available general audit software. Common data analysis procedures include:

  • getting a data profile (working out the size, number and distribution of transactions in a file)
  • sorting, extracting and listing records based on certain criteria sampling

Benefits of computer tax auditing

Computer auditing is more efficient for you as we won't need hard copy reports of information provided electronically and can do more work off-site.  This means:

  • less disruption to your business
  • fewer demands on your staff
  • reduced audit costs.