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Consider the accounting and tax laws your business must follow. For tax purposes, you are typically required by law to keep comprehensive accounting records for your business. Preparing your accounting records to be in compliance with the law will make a potential federal revenue audit easier to comply with.[13]
Make IRS procedures such as keeping accounting records for at least six years a part of your internal audit trail process. This way you already have the processes in place that are required to respond external audits from the IRS and other external parties.
To find out what laws are relevant to you, the Small Business Administration website is a very helpful resource. In addition, you can also consult with your accountant or bookkeeper if you have one.