I'm supposed to start an audit on this, um, yesterday. I can't find anything about it, I assume I need to make sure all R/E loans have a W-9 and that they are correct. Anything else I need to know? If someone can point me in the right direction so I can read up on it that would be great. Thanks!

I guess having an audit titled like that would be very confusing to me also. The Tax Reform Act of 1986 was a huge piece of legislation and many aspects of the original legislation has since been amended. I guess I would have to ask who scheduled this audit and why and when scheduling an audit - did they not include any objectives??? If you are doing an audit on IRS Information Return requirement - that is one thing, but titling an audit after a specific Act that is 11 years old seems a little strange.

OMG...I am doing an Info return audit right now from scrath....and it is dragging into its third month.....it has thrown my entire audit schedule off for the whole year now!!

I hate information return reporting!!!!!!!!!

Yes, I suppose it is on information return. Our internal auditors did the schedule. And nope, no objectives, they told me what to audit and I put it into the schedule. Don't ask me what they were thinking, I think I've said it in here before but (maybe even to you rl) I think my IA's drink.
So let's go with information return, any advise for material to read up on? Anything and everything is appreciated.

bbsgrant-I'm going to pretend that your being sarcastic, and go into this with optimism
Any workpaper advise?

Well, for starters, I would ask them for a copy of their risk assessment which pointed to this a risk that needed to be audited and then look at the components/criteria that they used to make that determination.

Information Return Audits can cover a variety of subjects:

W-8s
W-9s
All the different 1099s
1098s
5498s
W-2s

You are going to have to determine the scope. Are your talking about information returns for customers, vendors, employees, etc.

Are your IA's internal or external??

Here is how I am approaching mine:

Used the IRS site quite a bit.

Created a spread sheet for each Infor Return the bank is/can be responsible for, if/how/when we utilize, who/when is it used, when is the form prepared, who prepares and who produces the form, who reports the info to the IRS, did we have any in 2006, and then any findings.

Reviewed each info return separately...is the form filled in correctly? Does a sample match account and file records? If there is any manual inputs, what are the department internal controls, if any?

When appropriate, can I tie back the total value of returns produced, to firm values?

Corrections...if we produced a return with bad info due to staff error earlier in the year, how do we fix? how do we learn of it? how many corrections are we making? are we even tracking our errors to put a fix in place in the first place?? do we even have a handle on how many errors we have made??

Whose hands are in the reporting function?? who is using the automated system and who is not?? why not?? do we need to consider consolidating the reporting functions?? who determines if we report on someone or not?? are we getting W9's or not?? what does our policy say, if we have one??

We have never done an audit like this before, so we are in the process of learning a lot about ourselves right now!! It is quite the daunting task, and it seems the more avenues we question, the more doors and inconsistentcies we find.

Good Luck!!

Memo Queen, I think all IA's drink. It's consider medicinal:D

Well, I did have a sign in my office at one time that said:

Posts must write;
Singers must sing:
However, compliance officers must drink to be at peace with oneself.

They are Internal Auditors, pretty sure I'm only auditing the customer docs, so that would leave the W8's and W9's right? I'll pull up the IRS site and check it out, this is the first time we have done an audit on this too. I think that this bank had a pretty bad exam before I came to work here so they are having me audit anything they think of, I'm doing one compliance and one safety and soundness audit per month. It's been pretty crazy in my office since the first of the year.Thanks for giving me a place to start!

That will definitly be considered this weekend!

Randy, that would be over 21 years since 1986!! It is just that it went by so quickly.

Oh God KB - now you know why I'm an old compliance officer and not an old accountant..... If I don't have my APY and APR calculator with me, I'm lost. Simple math has always been such a challenge.