If you treat auditors like idiots then you will have a problem, said Matthias Feldt, head of the VAT group at ThyssenKrupp.
Marc Welby, a VAT partner from BDO, concurred with this approach.
You need to explain everything to the auditor. However, [within HM Revenue and Customs in the UK] the personnel have mixed abilities. Some are very clever while others do not know what they are doing, said Welby.
Despite this criticism of HMRCs officials, Charles Middleton, a senior corporate tax executive from British Land, said that taxpayers need to be aware of a shift that HMRC and other revenue authorities are now treating audits.
Authorities are now working on a more real-time basis and wont often wait for returns to be filed before investigating a companys operations, said Middleton.
You need to treat the auditors with great respect as they are the ones with the power, said Feldt.
The panel also spoke how best to manage audits in foreign jurisdictions.
Face-to-face meetings are key as this will give you the opportunity to explain the situation and answer any of their questions, said Welby.
The panel concluded that the best method to effectively manage an audit is to document all processes and ensure that you portray confidence to the auditor.
If you cant convince the revenue of your confidence in your system, then you have a problem, said Welby.
You need to bring the auditor up to speed as quickly as possible so that no time is wasted on needless discussions, said Feldt.
© 2021 Euromoney Institutional Investor PLC. For help please see our FAQ.