Form Gt-800059 - Sampling And Your Audit printable pdf download

GT-800059

Sampling and Your Audit

R. 12/17

How Can Sampling Benefit My Audit?

The nature of your records will determine the best audit plan for your business. The most accurate and

unbiased audit is a detail audit. A detail audit is when each record in the audit period is examined to

determine the actual amount of additional tax is due or overpaid. A detail audit may be required by

statute for some record types. Generally, the amount of time needed to complete a detail audit is too

great, unless the records are available electronically.

An auditor typically selects a sample of records from the audit period and the auditor only examines the

records in the sample. A properly designed sample can reduce the collective efforts of the

taxpayer and the Department to complete the audit. Shorter audit times result in a cost savings

to you.

Although the emphasis of this publication is on sales and use tax, the same sampling procedures may be

used for audits of other taxes administered by the Department.

What Is Sampling?

Sampling is taking a segment of a much larger group or population and drawing conclusions about the

population based on sample results. Randomly selecting the sample from the population removes bias

from the sample selection process because each sample point has an equal chance of being selected.

The objective of sampling is to provide an effective and efficient audit result in less time than it takes to

complete a detail audit. We use two types of sampling:

•

statistical

•

non-statistical

Statistical Sampling

Statistical sampling uses random selection of sample points with precision or sampling risk calculated on

the results. Precision measures how far off the sample results could be from the actual results.

The statistical sampling methodology used by the Department is stratified statistical sampling. Stratified

statistical sampling separates your data into similar groups, called strata, based on statistical

methodology.

Stratified statistical sampling allows for calculation of sample precision at a 95% confidence level. In

order to conduct a statistical sample, your transactions must be available in an electronic format and

provided to the Department on electronic media. Your auditor can provide you with a list of supported

media types.

How Are Statistical Sample Points Selected?

Statistical sample points are randomly selected from the electronic data. Records must be in good

order and substantially complete for each transaction to have an equal chance (or probability) of being

selected.

The Department typically uses seven sample strata. A detail threshold is identified and a detail group is

separated from the population to be sampled. The detail group contains the high dollar items in the

population. Such items represent a large portion of total dollars and only a small percentage of total

items.

Florida Department of Revenue, Sampling and Your Audit, Page 1

Form Gt-800059 - Sampling And Your Audit