Workers Comp Payroll Audits Preparation Made Easier
Payroll audits can be stressful. I just received notice that the insurance company auditor is coming in to audit my company’s Workers Comp information. How do I prepare for the audit? What information do I have to provide them?
According to your insurance policy, the insurance company auditor has the right to examine almost any of the records that your company has available. If you refuse to show the insurance company auditor the information they need, that may look suspicious to the auditor.
There are a few things that one can do to get ready for the Workers Comp audit. The best thing to do is make sure that you have ACCURATE and highly organized payroll records together with a summary sheet of those payroll records. Make sure that all subcontractors and temporary workers are segregated on the payroll. The Certificates of Insruance (Certs) should be provided to the auditor. This will save your company many headaches with the subcontractor payroll separation.
Excel(r) helps organizes payroll very quickly including summary reports. Please remember that neatness counts in any type of audit.
Have someone that is the most familiar with the payroll records be available to answer any questions and provide any additional information that the auditor may request.
It is best to make sure that the auditor has a quiet place to work, away from the daily activities in your business day. There are many guides on how to try to influence the audit, but we do not agree with them as being upfront and honest are the two best ways to conduct yourself when the yearly Workers Comp audit occurs.
We have seen quite a few employers become part of a disturbing trend when it comes to the audits. We will discuss this on the next post- Delaying the Audit.