As with any industry, the organization of the records

differs with each specific taxpayer. But many shops use

similar systems. It is important to identify how the records are organized since the nature of the examiner's request will depend on the method used. The most frequently encountered systems are discussed below:

Current Jobs: Auto Body shops usually maintain current

jobs in folders (job jackets). The information contained will include the estimate for that particular job, the repair order, the dealer invoices for the parts, correspondence with the insurance companies, and the flag sheets which keep track of the number of labor hours spent on the job.

Once the job is completed, the taxpayer has a number of

choices as far as filing the above information. In some

cases, all of the above information is kept together in

one package by customer. This allows the shop to answer

most questions which may arise once the job has been

completed. In this case use of normal sampling techniques by the examiner is very difficult.

More often, the taxpayer will separate the invoices by

vendors. This is especially true where shops have established a credit line allowing all invoices accumulated in one month to be paid off at one time.

In smaller body shops it is not unusual for all information to be accumulated by the month. Invoices

paid and sales collected in a single month will be filed together in an envelope. Although not the most efficient way of organizing records, it provides the examiner with an opportunity to probe more thoroughly.

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Chapter 1 Chapter 2 Chapter 3 Chapter 4 Chapter 5 Chapter 6 Chapter 7 Chapter 8 Chapter 9 Chapter 10 Glossary