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How do I review a tax provision provided for audit?

review a tax provision provided for auditMy company is undergoing our first year audit, and our tax professionals have provided us with our tax provision for those years. I did provide the PBC to them, but could someone give some pointers in what to look for in reviewing the tax provision before I give it to our auditors? Thanks!

Answers

Eric Bryant
Title: Controller
Company: TechMediaNetwork
(Controller, TechMediaNetwork) |

Review the workpapers provided by your tax professionals with the preparers, work through the reconciliation of your GAAP financials back to the taxable net income number, tie those numbers back out to your financials. Ask them about any major areas of concern or points of interest that they might have, then go from there, ask lots of questions. More than likely, most of it will make sense without much tax training if you are in your first year of audit, if your company has been in business for more than a few years it will start to appear a little more complex. Its good to start asking your professionals to explain everything to you now so that as it gets more complex over the years you at least have a good foundational understanding of how it worked when things were simple. Tax provisions can get pretty complex so don't feel stupid if you don't know something, and don't expect to be able to create a tax provision later, just make sure you understand where they are pulling the numbers, make sure they are your numbers, and understand what is new or what changed year over year. One major point to make that I did not make before, make sure you have a good preparer.

Anonymous
(Assistant Controller) |

Thanks for all the info! This was exactly the type of guidance I was looking for.

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