Tax Auditing

Use the Tax Auditing feature to enter input taxes in DPS and report on taxes from billing invoices and purchase orders.

When the Tax Auditing feature is enabled, you can enter input taxes for the following:

• Accounts payable vouchers, accounts payable disbursements, employee expenses, cash disbursements, cash receipts, invoices, and journal entries in the Transaction Center
• Expense reports in the Expense application

The taxes that you enter for purchase orders in the Purchasing application are also input taxes, but you can enter taxes for purchase orders without turning on the Tax Auditing feature.

Enabling the Tax Auditing feature also allows you to report on taxes that you enter for purchase orders and billing invoices. When the Tax Auditing feature is not enabled, you can enter taxes for billing invoices (if you have the Billing application installed) and for purchase orders, but not report on them.

Settings

You set up individual tax codes in Settings > Cash Management > Tax Codes. You specify that a tax code will be used as an input tax and enter an input account for it (usually a debit account). Tax codes are used when you enter transactions and expense reports to determine the tax calculation for the transaction and expense report items.

Enable the Tax Auditing feature and enter default settings, including default tax codes, in the Tax Auditing Feature section of the Options form in Settings > Cash Management > Options.

The default tax codes are used to prefill and calculate taxes automatically for:

• Accounts payable vouchers, accounts payable disbursements, cash disbursements, and employee expenses that you enter in the Transaction Center
• Expense reports that you enter in the Expense application

Processing

When you enable the Tax Auditing feature and use default tax codes, taxes are calculated automatically and entered in the Total Tax Amount field on the entry grids for:

• Accounts payable, accounts payable disbursement, cash disbursement, employee expense, and journal entry transactions in the Transaction Center
• Expense reports in the Expense application
• Purchase orders in the Purchasing application

You can click the hyperlink in the Total Tax Amount field to open the Tax Codes dialog box and add, remove, or change the calculated taxes for any transaction or expense report item.

Reporting

When you enable the Tax Auditing feature, transaction lists and posting logs in the Transaction Center and on the Employee Ledger report (for taxes entered on employee expense reports) include tax information.

The following reports are available in Reporting after you enable the Tax Auditing feature:

• Sales List
• Tax Analysis

You can include the Tax-2 Amount column on the Vouchered Purchase Orders Items report when the Tax Auditing feature is enabled.