An entertainment company that provides postproduction sound and video services to film and TV production companies engaged RSI to provide a comprehensive recovery audit of its accounts payable and sales/use tax departments. The company had grown through more than sixty (60) mergers and acquisitions of smaller companies located in multiple states. The company was also under audit by the state for sales and use tax.
RSI staff and client’s key personnel met to discuss client’s expectations for the audit. RSI analyzed client’s a/p process and obtained hard copies of client’s pertinent purchase contracts, purchase orders, etc. Client delivered a download of its a/p history and purchase order information to RSI and we compared the electronic data against the hard copy information to identify client’s feeding process. RSI created custom queries to identify more than 25 different types of payment irregularities within the data. RSI then exported, extracted and filtered the data to generate reports that were used to identify overpayments in the data.
RSI then conducted a manual audit where we reviewed all underlying a/p documents. Our manual review resulted in the identification and recovery of overpayments not found within the data, including significant overpaid tax monies from multiple states that could not be identified from the data.
RSI’s primary recovery audit reduced the client’s state tax assessment by over $600,000 and yielded an additional $2,500,000 in recoveries.