Preliminary audit

• In order to have a smooth audit process, records should be organized in advance and a preliminary audit meeting should be held.
• Proper organization of the records to be used by the auditor means matching up the fuel receipts with the trip reports and arranging items in chronological or unit order.
• The initial meeting with the auditor should include an introduction to a company liaison or contact and communication procedures should also be discussed.

Organization of audit records

The advance organization of the records required to conduct the audit will permit the audit to be conducted efficiently and quickly. The audit will be concluded more quickly with good pre-audit preparation.

The records required by the jurisdiction should be determined as soon as possible. The basic records will be required, such as International Vehicle Mileage Records (IVMRs) or trip reports, Global Positioning System (GPS)/Electronic Logging Device (ELD) data, fuel receipts, trip permits, fuel and distance listings, recaps, and tax reports. Any records that provide substantiation for the tax reports will be needed. It is not helpful for the licensee to provide records that have not been requested by the jurisdiction; often they simply take extra time for the auditor to examine. Requests by the jurisdiction for records beyond those required to substantiate tax liability should be considered carefully, since they can take time for the licensee to locate, organize and audit.

Proper organization of the records to be used by the auditor means matching up the fuel receipts with the trip reports and arranging items in chronological or unit order. This will certainly make the auditor's task easier, and further a positive relationship with the jurisdiction.

Preliminary audit meeting

When the auditor(s) arrives, time should be spent to ensure a smooth audit process. A meeting with the auditor should be held, and at this time the audit procedures of the jurisdiction should be reviewed so the licensee has a clear understanding of how the audit will be conducted. The jurisdiction distance and miles-per-gallon/kilometers-per-liter factor can be reviewed at this time. The licensee's recordkeeping system should also be reviewed with the auditor so the required information may be obtained easily and quickly.

The initial meeting with the auditor should also include an introduction to a company liaison or contact. Designating an individual with whom the auditor may discuss any questions or problems will enable the licensee to provide answers and solutions in an organized manner. If the auditor is interacting with several staff people, they may receive incomplete information or answers that are contradictory. It is much easier to communicate with one contact and maintain a clear picture of the audit progress and any problems.

Communication procedures should also be discussed; how and when will errors or omissions be handled? Will they be discussed and handled as the audit progresses, so that additional documentation may be provided to clear up problems, or will all such issues be mentioned only at the conclusion of the audit? Clearly, the preferred alternative is to develop communication during the audit rather than waiting until the auditor is presenting results.

It is important to continually develop a positive relationship with the auditor. An introduction to the staff and the licensee's facility will help the auditor feel more comfortable and allow them to proceed more efficiently with the audit.