Ill. Admin. Code tit. 86, § 850.155 - Notice of Engagement and Agreed-Upon Procedures
a) A qualified practitioner hired by a
taxpayer who has received an actionable referral under Section
850.115(b)(3)(B)
to perform a certified audit must submit a
Notice of Engagement to the Department notifying it of the taxpayer's
participation in the Certified Audit Pilot Program on behalf of the taxpayer on
a form prescribed by the Department.
b)
The information provided in the
notification shall be submitted in the form and manner required by the
Department and shall include the taxpayer's name, federal employer
identification number or social security number, Department account
identification number, mailing address, and business location, and the specific
occupation and use taxes and period proposed to be covered by the engagement
for the certified audit. In addition, the notice shall include the name,
address, identification number, contact person, and telephone number of the
engaged firm. [50 ILCS
355/10-35(a) ]
c) The qualified practitioner must agree to
conduct the certified audit using the Illinois Department of Revenue's
agreed-upon procedures at the time of the qualified practitioner's submission
of the Notice of Engagement.
1) The Department
has established a list of agreed-upon procedures that qualified practitioners
must follow in a certified audit. These designated agreed-upon procedures
combine elements from the American Institute of Certified Public Accountants'
Clarified Statements on Standards for Attestation Engagements with the
Department's own audit standards.
2) Any deviations from the established list
of agreed-upon procedures must be approved in writing by the Department. The
qualified practitioner must submit a written request to the Department and
receive written approval from the Department prior to making any additions,
deletions, or revisions to the approved certified audit plan.
3) The Department will be the final authority
on the nature, extent, and type of audit procedures.
d)
If the taxpayer has received
notice of an audit referral from the Department and has not been issued a
written notice of intent to conduct an audit, the taxpayer shall be a
participating taxpayer and the Department shall so advise the qualified
practitioner in writing within 10 days after receipt of the engagement notice.
However, the Department may limit the taxes or periods subject to the certified
audit. [50 ILCS
355/10-35(b) ] The Department may
deny a notice of engagement for any of the following reasons:
1) the taxpayer has delinquent final
liabilities for any tax that the Department administers (this does not include
taxpayers currently on a payment plan approved by the Department's Collection
Program Area to satisfy a delinquent final liability);
2) the taxpayer has voluntary disclosure
agreements in place or pending for occupation or use tax for the audit period
under consideration for the Certified Audit Pilot Program;
3) the taxpayer has been issued a notice of
an upcoming occupation or use tax audit by the Department; and
4) the taxpayer does not have complete
records available for the entire audit period under consideration for the
Certified Audit Pilot Program.
e) If the Department denies the Notice of
Engagement, the written notification to the qualified practitioner must set out
the specific reasons for the denial unless an ongoing investigation would be
jeopardized or confidentiality provisions would be breached.
f) If the taxpayer, qualified practitioner,
or the taxpayer's legal representative files a protest and requests a hearing
on the denial of the Notice of Engagement within 60 days after issuance of the
denial, the Department shall give notice to the taxpayer, qualified
practitioner, or taxpayer's legal representative of the time and place fixed
for the hearing and shall hold a hearing in conformity with the provisions of
the Retailers' Occupation Tax Act [35 ILCS 120
]. After hearing, the Department shall issue a final determination to the
taxpayer. If a protest to the denial of the Notice of Engagement and a request
for a hearing thereon is not filed within 60 days after the issuance of the
denial, then the denial shall become a final determination.
Notes
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