Exception: If an employer correctly reports the liability date to the Agency,
but goes out of business before 4 quarters of employment have occurred, the Accounts Examiner must
audit all quarters of liability (1-3 quarters). For this exception to the requirement for a 4-quarter
audit to apply, the employer must be out of business and not merely operating without employment.
An audit should start with a four (4) quarter sampling. The scope of the audit may need to be expanded to a prior year and to a succeeding year, depending upon the Tax Department's criteria for expansion.
An audit should not include any time period covered in a previous audit, nor should an employer be audited more than once in a 36-month period. The Regional Tax Manager or Audit Program Administrator should approve exceptions.
