Auditing is an essential part of maintaining your company’s financials. The job of an auditor is to check the accounts of the company and then determine whether the financial statements have been presented accurately. Auditing is essential for public companies, and many private companies also get audits done because they want to attract more investors. When you present an audited set of accounts to an investor, they will be more interested in making an investment as compared to an unaudited set of accounts that have been prepared only by the owner of the business.
However, auditors aren’t perfect either. If the auditor creates a report that shows your company in a bad light, you might find yourself with a serious problem. Auditors are responsible for checking the tax calculations of the company as well. It’s their job to ensure that the company’s tax payments are calculated properly. At the end of the day, you will be the one who has to pay off the tax debt, and the Australian Taxation Office (ATO) will force you to pay it.
So, does that mean that a business which has received a terrible result in an audit is liable to pay the fines and bear the brunt of the full tax debt? Not entirely. In fact, you may have 60 days to rectify the mistakes made by the auditor. If you don’t take action within that time frame, the Australian Taxation Office will simply turn a blind eye and force you to make the full outstanding payments. While the mess may have been created by the auditor, you will be the one who is responsible for fixing it.
What You Should Do
The first and most important thing to do here is to file an objection letter. Before you do, however, it’s recommended that you check the ATO objection letter example. It will give you a clearer idea of the wording that you should use and the style of writing that is suitable for the process. Once you have checked the ATO’s letter, it’s recommended that you start planning ahead. Remember, you are still in the objection phase, so if this doesn’t go well, your next option will be to either approach the Administrative Appeals Tribunal or the Federal Court. But both of these will reduce your options and limit you to the grounds that you have set for yourself within the letter of objection.
Know Your Laws
It’s vitally important that you understand the laws associated with filing an objection letter. If you are not aware of the laws governing the filing of an objection letter, you are going to make mistakes. Talk to someone who has experience in this field to get a better idea about the laws governing the process. This will make it easier for you to figure out the actions you need to take to salvage your position and secure a better judgement.