What Is An Audit?
An audit is an official inspection of a person or company’s financial accounts. Audits may be initiated for a variety of purposes, depending on context.
Is It Bad To Be Audited?
Not necessarily. Audits are one of those legal terms that come up in a bunch of different areas, and can mean a whole bunch of different things depending on the context. For example, a successful start up company preparing to be acquired can undergo an audit. Alternatively, a person who hasn’t paid their taxes can be audited. Obviously, the two are very different (although they are both audits). If your start up company is being audited prior to an acquisition, you have done pretty well for yourself. On the other hand, if you are being audited by the IRS, you may not have done so well for yourself.
What Happens When You Get Audited?
When you are audited, your (or your company’s) financial records are carefully scrutinized by an independent third party with an eye towards whether your reported calculations are accurate. You may be required to provide a detailed accounting of your income, spending, and/or other financial records. Receipts, deposit slips, and copies of checks may be important.
Who Does Audits?
Accountants, for the most part. Lawyers do not do financial audits, although they should be able to read them.
Got An Audit Question?
Attorney Chris Mutchler may be able to help. Get in touch with The Law Office of Christopher J. Mutchler. If we can’t help you, we’re more than happy point you in the direction of someone who can!
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