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Labor and Economic Opportunity

Why is the auditor examining records other than the payroll records?

The auditor reviews records other than the payroll records to trace the payment of wages from the source of original entry to the individual payroll records, and to look for taxable wages that may have been misclassified as non-taxable payments. The auditor also reviews some non-payroll records to ensure that liability has been established properly and that the tax rate is accurate.Section 9 of the MES Act authorizes the UIA to review all records maintained by the employer, to verify that all taxable wages have been properly reported, and to impose legal
remedies for failing to produce the requested documents.