Reply To: My First Audit

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#45881

Eric and Everyone,

Thanks again for what you do and your service to this industry and to this group.

I have my first examination phone interview for a 1065 client, tax year 2019. Fyi, we’re the preparer for the last 2 years and have a bookkeeping consulting arrangement with them (we do not do their books per se, just help with questions; they handle their books internally). I had an initial call with the revenue agent and provided my 2848, where she discussed the scope of the audit (an IDR had not yet been created or given) and we scheduled the official interview for 9/28/2021. Forgive me, but here are questions/comments/concerns; please weigh in as you can:
1) After receiving the IDR, the scope is much broader than what was provided on the initial call. Is this normal?
2) After receiving the IDR its been broadened to include 2018 and 2020 (to which they’re on ext; not yet filed but will be by 9/28). Is this normal? I assume they have the authority of course; but why didn’t she, the rev. agent, initially mention it. We’ve prepared 2019 and will prepare 2020, fyi.
3) They’ve broadened it to include the returns of the 20%-or-greater partner. Although we didn’t opt out of CPAR, is this normal? I assume they have the authority of course; but why didn’t she, the rev. agent, initially mention it.
4) The partners include a 1065 and an 1120; but I don’t have 2848s for them; wouldn’t they need an IDR or something to request these returns from the partners?
5) I assume the individual partners’ returns of these partners to my clients are not to be included? Again, if so, wouldn’t they need an IDR for these returns?
4) Some of the client’s docs and records were destroyed in the TX snowpacolypse and water damage; if we can’t get, do we reconstruct or gather invoices/receipts from vendors etc.?
5) The IDR is requesting QB backup files in .qbb or equivalent. The client uses QB Online; what format should I gather for them or send a CSV export and explain in a letter that they do not have QBD, just QBO?

All the other items on the IDR is straightforward; should be fairly easy to gather.
Thanks in advance,

Jeremy Andries, EA