What business Need To Know About PREMIUM AUDIT? Most entrepreneurs discover is subject to revision of premium insurance companies for general liability, workers compensation, and sometimes for the car, and even builders risk insurance policy. This applies to most of the contractors , including general contractors, plumbing, heating, ventilation and air conditioning (HVAC) contractors, electrical contractors, drywall contractors, painting contractors,Roofers and so on.

A premium audit is a review of your business, financial reports and records to determine what it charges for liability insurance, workers compensation or other type of coverage provided. The objective is to determine the ultimate prize achieved for a policy, which was issued on the basis of payroll, for, sales, subcontractor, or other variables.

Insurance premiums are based on forecasts that specifies the basis for wageSales, costs, and perhaps sub-contractors. Your insurance can vary rates based on this information, intended to monitor what the premium should be adjusted based on real experiences.

Control is by an examiner who conducted the insurance selected. Can an employee of the insurance company or an employee of an audit firm or even an independent contractor.

There are three types of control premium. Depending on the size of premiums andTheir operations that is received, is able to provide the following:

Physical Audit - management at your company or in a secondary site, such as your accounting office.

Phone Audit - An auditor contacts you over the phone to complete the test. This type of test is usually for small and medium-sized accounts.

Mail Audit - A voluntary audit form with instructions will be sent by email. Mail checks are normally conducted for smaller accounts.

RECORDS auditors can ask for: accountsprobably for one or more of the following types of documents:

Magazines and costs
Individual tax filings
Pay Records
Time Cards
Vehicle Title
Contracts with customers
Contracts with subcontractors
Records of labor costs
SEC
Balance Sheet

The examiner may ask questions the Court will probably be a few questions about your records or operations. You can ask questions to determine whether to apply the appropriate classification. If aAuditor decides the transactions are properly classified, can become an unpleasant surprise result of a large billing audits. Make sure you understand your rankings and how the boundaries of your particular classifications are defined.

If a researcher requests the use of classifications, ask to see some recent work carried out by staff.

E 'for credits you are entitled to understand in examinations.

Rating Insurance andValuation rules often allow credits to his control, but your records must be maintained for the required information in detail and summary form.

If the premiums are based billing, you will pay for the full amount of compensation under the policy.

Compensation in most states, means money or substitutes for money, and includes:

Bonus
Boards
Holiday pay
Other funds replacement
Remuneration
The payments to profit-sharing plans
Payment LawDefined benefit plans
The value of the accommodation and catering
Tool Allowances
Wages

Help you understand the terms and definitions to make sure you avoid overpaying from an audit.

OVERTIME
In most states, the amount attributable to overtime, which can be deducted on the fare wage time. It must be clearly identified in the records. Excess rates for overtime must be clearly separated in payroll.

DISTRIBUTION OF PAYROLL
Division of a singlePayroll of employees to more than one classification is not allowed, except the classifications for the construction or assembly operation and / or some executive officer. If the reward is-divisible, time card daily should be preserved for the division of labor on different classifications. The inability to hold the cards twice a day, may in all wages and salary of a worker will always produce the highest rating classification assigned.

SUB-CONTRACTOR
Prevention for injuries to employees of subcontractors used bythe purchase of insurance naming is an additional insured. Check your contracts with subcontractors to ensure that we take the liability provisions and allowances properly protected. Judge to see if they adhered to the conditions as respects your policy for your suppliers. Sometimes the tests are bad when the certificates are not available, or the examiner determines payments to subcontractors are really wages to employees.

Automated data
Set yourprovide automated data audiors what they need, and you will find your verification without a hitch, and save a lot of time in the future.

DOCUMENTS you may be asked for an examination
Liabilities and cash dispersements newspaper
Magazine R /
All leases of vehicles, including but not limited to, owners and operators of leases
Annual returns
Documents supporting the entries in journals and financial statements
Driver and vehicle records
ExpenseMagazine
Profit and loss
Individual monthly reports profits
Payroll records including the payroll journal
941's Quarterly
Applications for used cars
SUI (State organization of unemployment Relations - U.S. 6 in California)
General and subsidiary books sales
All Magazines base

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