Mich. Admin. Code R. 205.4105 - Electronic data interchange requirements

Rule 5.

(1) Where a taxpayer uses electronic data interchange processes and technology, the level of record detail, in combination with other records related to the transactions, shall be equivalent to the level of record detail contained in an acceptable hardcopy record. For example, the retained records should contain information including, but not limited to, the vendor name, invoice date, product description, quantity purchased, price, amount of tax, indication of tax status, and shipping detail. The taxpayer may use codes to identify some or all of the data elements, provided that the taxpayer provides a method that allows the department to interpret the coded information.

(2) The taxpayer may capture the information necessary to satisfy subrule (1) of this rule at any level within the accounting system and need not retain the original EDI transaction records provided that the audit trail, authenticity, and integrity of the retained records can be established. For example, a taxpayer using electronic data interchange technology receives electronic invoices from its suppliers. The taxpayer decides to retain the invoice data from completed and verified EDI transactions in its accounts payable system rather than to retain the EDI transactions themselves. Since neither the EDI transaction nor the accounts payable system captures information from the invoice pertaining to product description and vendor name (i.e., they contain only codes for that information), the taxpayer also retains other records, such as its vendor master file and product code description lists and makes them available to the department. In this example, the taxpayer need not retain its EDI transaction for tax purposes.

Notes

Mich. Admin. Code R. 205.4105

1998 - 2000 AACS