This item is actually two reports in one: 1) Sales and Use Tax Survey Results and
Recommendations for End-User Organizations and, as a bonus, 2) State Tax Audits of P-Card Transactions.
First, to obtain a clearer view of how end-user organizations approach sales and use tax compliance, the NAPCP and Application Design Resource, LLP (ADR) jointly conducted a survey of the end-user community. The 42-question, online survey was open for responses between December 1, 2010, and January 31, 2011. The complete report of survey results (30+ pages of content) highlights possibilities for improvement in end-user approaches to tax compliance. It also draws out some best practices. Providers, too, should take notice, as results indicate an opportunity to partner with end-user clients in this respect, which can lead to future program growth.
Survey topics included:
- organization annual expenditures and card program demographics
- receipt requirements and retention practices
- estimated prevalence of Level II data (tax amount) and the related accuracy
- process for accruing use tax or, if no process is established, the stumbling blocks for doing so
- data utilized for use tax accrual, frequency of accrual, accuracy and time spent to manage the process
- whether card transactions are included within state audits
- degree of difficulty in providing documentation requested by auditors
- use tax assessments
- impact of audit results on the card program
- role of cardholders, the tax department and card program management team in tax management
- external resources utilized (e.g., consultant, technology provider)
- support from the card issuer
View the Table of Contents for this report.
Second, in December 2010, the NAPCP invited state tax authorities (excluding the five states that do not impose sales tax) plus the District of Columbia to participate in a survey related to their auditing practices. Specifically, the purpose of this survey was to obtain a clearer view of the sales tax requirements and audit process in each state to help end-user organizations:
- develop an appropriate sales and use tax management process, including documentation and retention practices
- better prepare for state sales tax audits
The survey was open for responses through February 18, 2011; 15 states completed the survey, which addressed elements such as:
- how P-Card transactions are selected for review by state auditors
- transaction documentation to support sales tax paid
- retention of paper receipts and/or electronic/imaged versions
- preparing for a tax audit
The complete report of results, reflecting responses by state, is included as a bonus with your purchase.
Note: Both complete reports are complimentary to NAPCP members. In addition, an executive summary of the end-user survey results report is available to NAPCP members and complimentary subscribers. Please visit the Resource Center to access.
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