With Respect to the Audit Process Which, If Any, of the Following

question 1

Multiple Choice

With respect to the audit process which, if any, of the following statements is incorrect?

• A)Upon advance request, a taxpayer must be allowed to make an audio recording during the audit conference.
• B)Only the Appeals Division of the IRS has the authority to settle tax disputes based on the hazards of litigation.
• C)The issuance of a Revenue Agents Report (RAR) is usually not necessary when mathematical errors on a tax return understate a taxpayer's tax liability.
• D)The IRS does not publish the factors it uses for audit selection purposes annually in the Commissioner's Report.
• E)None of the above is incorrect.

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Definitions:

Equity Method

An accounting technique used to record investments in other companies, where the investment is significant but not controlling.

Stock Investments Account

An account used to record the purchases and sales of equity securities, such as shares of stock, that a company holds as investments.

Annually

Occurring once every year or relating to a period of one year.

Significant Influence

The power to participate in the financial and operating policy decisions of an investee but not control those policies.