Can a bookkeeper help during an IRS or state audit?
TL;DR: Yes. A bookkeeper can prepare organized records, produce reconciliations, and supply supporting schedules; they cannot act as legal representation but can work alongside your CPA or enrolled agent to provide the documentation auditors request.
On the go? Listen on The Deep Dive — where we dig deeper into this topic: ‘Audit Proof Your Business_ How Your Bookkeeper Can Save You from IRS Disaster (and When to Call the CPA)’. Listen or download.
Why this matters
Audits are stressful and time-sensitive. Organized, audit-ready bookkeeping shortens the audit timeline, reduces penalties by clarifying positions quickly, and helps your representative (CPA/EA) present a defensible case. A bookkeeper’s job is to provide accurate, reconciled records and clear explanations of transactions—not to provide legal representation.
Real-world story
A construction contractor received a state audit notice for sales tax and payroll. Their books were messy and missing payroll filings. Our team organized payroll registers, reconciled payroll liabilities, and created a clear timeline of filings and payments. The contractor’s CPA used our reconciliations and source documents to negotiate reduced penalties and an extended payment plan. The audit closed faster and with a better financial outcome than expected.
What a bookkeeper can do
- Organize and deliver requested documents — Bank statements, deposit slips, payroll records, vendor invoices, sales tax returns, and prior tax returns.
- Produce reconciliations and schedules — Bank reconciliations, A/R & A/P aging, payroll liability schedules, and fixed asset lists with supporting invoices.
- Explain bookkeeping entries — Provide memos or notes on unusual or one-off transactions and correct prior misclassifications.
- Bundle evidence — Assemble supporting docs (receipts, contracts, merchant payouts) into a clean folder with an index for the auditor.
- Coordinate with your CPA/EA — Work with your tax representative to answer technical questions and provide trial balances or adjustments they request.
What a bookkeeper cannot do
A bookkeeper cannot provide legal representation before tax authorities, sign tax filings as a preparer, or give legal tax advice. For representation or negotiation, involve a CPA or Enrolled Agent. If criminal tax issues emerge, consult legal counsel immediately.
Audit preparation checklist
- Save the audit notice and note deadlines. Confirm which periods and issues are under review.
- Create an indexed folder with subfolders for bank statements, merchant payouts, payroll, vendor invoices, sales tax returns, and contracts.
- Provide reconciliations for bank, merchant, payroll clearing, and sales tax liability accounts for the requested periods.
- Generate A/R and A/P aging reports with customer/vendor contact info and proof of payment/receipt.
- Prepare a fixed asset schedule with purchase invoices, depreciation method, and dates.
- Compile payroll registers, tax deposits (941/940), and W-2/W-3 filings for the years under review.
- Document any accounting policy changes or one-time transactions with memos and supporting documents.
- Create a summary letter explaining major reconciling items and significant adjustments.
Worksheet — Audit document index
Use this table to assemble documents requested in the notice. Fill in file locations and upload links. Copy into a spreadsheet or print it.
| Document | File Location / Link | Date Range | Uploaded (Y/N) |
| Bank statements (Primary checking) | Drive/2024/Bank | Jan 2024 – Dec 2024 | |
| Merchant processor payouts (Stripe/Square) | Drive/2024/Merchant | Jan 2024 – Dec 2024 | |
| Payroll registers & tax deposits | Drive/2024/Payroll | Jan 2024 – Dec 2024 | |
| Sales tax returns & exemption certs | Drive/2024/SalesTax | Jan 2024 – Dec 2024 | |
| Vendor invoices & paid receipts | Drive/2024/Vendors | Jan 2024 – Dec 2024 | |
| Fixed asset invoices & depreciation schedule | Drive/2024/FixedAssets |
CSV copy (paste into a sheet)
Document,File Location / Link,Date Range,Uploaded (Y/N)
Bank statements (Primary checking),Drive/2024/Bank,Jan 2024-Dec 2024,
Merchant processor payouts (Stripe/Square),Drive/2024/Merchant,Jan 2024-Dec 2024,
Payroll registers & tax deposits,Drive/2024/Payroll,Jan 2024-Dec 2024,
Sales tax returns & exemption certs,Drive/2024/SalesTax,Jan 2024-Dec 2024,
Vendor invoices & paid receipts,Drive/2024/Vendors,Jan 2024-Dec 2024,
Fixed asset invoices & depreciation schedule,Drive/2024/FixedAssets,,
Here’s a ready-to-use CSV you can open in Google Sheets or Excel.
Download the CSV — GTB Audit Document
How we work with auditors
- We receive the notice and confirm the scope and deadlines with you.
- We compile requested documents and create reconciliations and schedules.
- We provide the auditor with indexed documentation or share a secure folder as instructed.
- We answer factual bookkeeping questions and supply supporting documents; your CPA/EA handles technical tax responses and negotiations.
- We document everything and keep a copy for your records.
FAQs
Q: Will my bookkeeper talk to the auditor directly?
A: Yes — for factual questions and document delivery, but complex tax questions should be routed to your CPA or enrolled agent.
Q: How long does audit support take?
A: It depends on the scope and record quality — a well-organized file can reduce support time from weeks to days.
Q: What if records are missing?
A: We’ll document gaps, provide reasonable reconciliations, and work with your CPA to explain missing items; severe gaps may require reconstruction work and could extend timelines.
Next steps
- If you received an audit notice, upload the notice and your most recent 12 months of records to a secure folder.
- Schedule a free 30-minute audit prep call.
- We’ll provide an index and a prioritized document list for the auditor.
Need audit support? Schedule you free audit defense call here here.
Giesler-Tran Bookkeeping • gieslertranbookkeeping.com • 971-200-5158