How automation is impacting tax audits, management

How automation is impacting tax audits, management

When a company enters tax season, the worst fear among accountants, boardroom decision-makers and stakeholders is almost always the threat of a comprehensive audit from the Internal Revenue Service. Even when the books are balanced and the business has maintained compliance with federal regulations, industry standards and general sound practices, an audit can be significantly disruptive and slow down operations in certain departments of the firm. 

As such, organizations will often automate certain aspects of tax-related management frameworks to reduce the risk of inconsistencies and errors, which are generally at the center of major audits even when the company has not stepped outside of the law. The trick is to not go completely off the reservation in these pursuits, though, as human oversight will still be critical to ensure the most positive and safest experience with the relevant automation tools in use. 

Risk and reward
Forbes recently explained that sales tax automation has become a highly popular and common practice among a range of businesses, and that many believe it to actually be the best step toward consistent compliance with the law. However, the source noted that simply automating these procedures and washing the hands of those who would once have been manually managing them is not necessarily a safe approach, as oversight will always be necessary to some degree. 

According to the news provider, there is no denying that the automation tools used for these purposes today are far more reliable and intelligent than those that were in the workplace only a few years ago, while many will enable simple ERP integration for more streamlined experiences. Still, Forbes argued that front-end systems might not be as helpful come tax season, but those that can provide more real-time information related to compliance and reporting will be more effective over time. 

The source added that the ways in which ERP and accounting systems interact with sales tax automation tools should be a point of focus for those responsible for the relevant oversight. 

Reliability is key
Businesses that choose to use automation solutions for relatively risky and mission-critical tasks must ensure that they are aligning with vendors that can assure consistent, reliable and accurate reporting. Especially when tax or regulatory compliance implications are involved, choosing the most proven providers of automation and ERP integration services will save the company from the significant issues that come along with legal woes. 

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