Audit processes and inspections always end up coming. Representation expenses represent a sensitive area within the information to be audited, since the processes related are often highly based on the paper. This entails several drawbacks and is apparent in Co-operative travel management – Conference management where there is a lot of information saved on paper. An audit typically represents a tense situation for companies. The auditors examine processes, activities and documents to confirm that everything is in order and rules are being followed.
The costs of representation as any, may be affected by an audit and be required for it. However, their nature makes them especially sensitive to some effects that can adversely affect the process. Disorder, lack of control, loss etc. For this type of expenditure in order to not spoil an audit, I recommend the following points:
- Representation expenses must be justified by the original or duplicated through a process that the Tax Office has validated as full proof.
- Remember that supporting documents, by law, must be saved for at least a 4-year period.
- Everything should be monitored with the paper. The use of tickets on this form is dangerous for the preservation of information. Thermal paper degrades quickly over time.
- If expense management is divided into several locations and there is a displacement of the proof, we must be careful with possible loss.
- Having documentation handy and well organized is essential in an audit. Having all receipts and expenditure sheets easy to search for is essential.
- Remember that an audit is not provided, unless that is internal. You always have to be prepared.
- If some irregularity is found, it can affect a tax offense. They are classified as minor, serious or very serious, and involve penalties proportional to its severity. The results of internal audits are included in the Commercial Register.
- Representation expenses must be justified by the original receipt. You need to keep it.
Ultimately, the key point to facilitate audits representation costs is the elimination of paper in the process. If you have virtual files or scanned receipts, the search process and justification is greatly facilitated, as losses and deterioration of information are avoided. However, before scanning you must take into account a key factor: the legal validity of the system used.