Are there written procedures for reporting of business, booking of premiums and taxes, and filing tax reports?
If you don’t have written procedures now, you ought to write them. Just narrate the process you use for complying with the provisions as if you were explaining it to the auditors (because that’s exactly what you are doing). To accomplish all of this, the auditors will ask you for your general ledger, your general journal, cash records and other items necessary to reflect the financial solvency of your agency, and month-end and year-to-date summary of operations in accordance with GAAP (Generally Accepted Accounting Principles). To summarize the audit process, the auditors will: • Determine how premiums and tax amounts are compiled for reporting • Trace tax collections/billings through your accounting system to ensure all taxes are accounted for. • Insure that tax for all endorsements or other changes in premium are accounted for. • Trace stamping office batch transmittals through your records. • Reconcile from period-to-date register runs to the reported data. • Use your policy/contrac
