What would an unexpected ATO review really cost your business?
Nobody starts a business because they are looking forward to dealing with the tax system.
Business owners want to build something.
They want to serve customers, employ people, create opportunities, make a profit and hopefully build something of lasting value.
But running a business also brings obligations.
Tax returns. BAS. GST. PAYG. Superannuation. Payroll tax. Record keeping. And an increasingly complex regulatory environment surrounding them.
Most of the time, those obligations simply form part of doing business.
Then an unexpected letter arrives.
The ATO or another government revenue authority wants more information.
- There is an enquiry.
- A review.
- An investigation.
- Or an audit.
Suddenly, your accountant has work to do that nobody had planned for.
That is precisely the problem Accountancy Insurance (GBC 2027 Corporate Partner) has spent more than two decades helping accounting firms and their clients manage.
An audit doesn’t necessarily mean you’ve done something wrong
There is an important misconception worth addressing first.
People sometimes hear the word “audit” and immediately assume somebody must have done something wrong.
That isn’t necessarily the case.
The ATO and other government revenue authorities undertake a wide variety of compliance activities, and businesses and individuals can be required to provide information or respond to enquiries even when they believe their affairs have been managed appropriately.
The real issue can then become the work involved in responding.
Your accountant may need to retrieve information, examine transactions, reconcile records, prepare explanations, communicate with authorities and assist throughout the process.
That takes professional time.
And professional time has a cost.
Who pays the accountant?
Under normal circumstances, if additional professional work needs to be undertaken, the client pays for that work.
That is where tax audit insurance can provide valuable protection.
Accountancy Insurance’s flagship product, Audit Shield, is designed to cover eligible professional fees incurred when an accounting firm’s client is required to respond to official audit activity initiated by the ATO or other government revenue authorities.
And “audit activity” is broader than the traditional image of a full-scale tax audit.
Depending upon the circumstances and the terms of the policy, it can include eligible audits, enquiries, investigations, reviews and examinations relating to lodged returns and financial compliance obligations.
That can extend across areas including income tax, GST and BAS, superannuation obligations, FBT, payroll and land tax, record keeping, SMSFs and other compliance matters.
In other words, the protection is designed around a simple reality:
Responding to government-initiated audit activity can require considerable professional work, and somebody has to pay for it.
Protection against an expense you didn’t plan for
At Global Business Camps, we encourage business owners to understand risk.
Not because businesses should become afraid of taking risks.
Quite the opposite.
Successful businesses take calculated risks all the time.
The important thing is identifying the risks that could hurt the business and deciding which ones can be reduced, controlled, transferred or planned for.
An unexpected professional bill arising from an ATO review is one of those risks.
You may never need to make a claim.
Hopefully you don’t.
But insurance exists precisely because some events are difficult to predict and potentially expensive when they occur.
Audit Shield gives participating accounting firms a way to offer their clients protection against eligible professional costs associated with responding to government-initiated audit activity.
And the scale of that activity is worth noting.
Accountancy Insurance reports that Audit Shield currently pays more than $1 million per month in claims for professional fees associated with audit activity.
That tells us this isn’t simply a theoretical risk.
Built by people who understand accountants
There is something else that distinguishes Accountancy Insurance.
They specialise in the accounting profession.
The business was established in 2003 by Pat Driscoll, who brought experience in financial accounting and public practice to the development of Accountancy Insurance and Audit Shield.
Since then, the company has grown to support thousands of accounting firms across Australia, New Zealand and Canada.
That specialist focus means they understand both sides of the equation.
They understand the accounting firm’s need for an efficient way to administer tax audit insurance.
And they understand what happens when a client suddenly needs their accountant’s help responding to an enquiry or review.
That combination of insurance knowledge and an understanding of public practice has allowed Accountancy Insurance to continue developing Audit Shield for more than two decades.
Protecting the accounting firms that protect businesses
Accountancy Insurance’s expertise also extends beyond tax audit insurance.
Accounting firms themselves face considerable business risks.
- They hold sensitive client information.
- They provide professional advice.
- They increasingly rely upon technology.
- They face cyber threats.
And like every employer and business, they have their own operational and management exposures.
Accountancy Insurance has therefore developed a broader range of specialist products for accounting professionals, including PI Shield professional indemnity insurance, Cyber Shield cyber insurance and Practice Management Liability Insurance.
Rather than trying to provide insurance products for every type of business, their focus is firmly on understanding the particular risks faced by accounting professionals.
We think there is something valuable in that specialisation.
Understanding an industry deeply can lead to better questions, better solutions and better support.
Good business isn’t about eliminating every risk
No business owner can predict everything that will happen.
- Markets change.
- Customers change.
- Technology changes.
- Regulations change.
- Unexpected events occur.
Building a strong business isn’t about somehow eliminating every possible risk.
It is about understanding where your exposures are and being prepared for the things you can reasonably anticipate.
That is as true of tax and regulatory risk as it is of cash flow, cyber security, key employees, customers or any of the other vulnerabilities within a business.
Sometimes the best outcome from good risk management is wonderfully uneventful.
Nothing happens.
But if something does, you are prepared.
Proud to have Accountancy Insurance in the GBC community
Global Business Camps has always had a particularly strong relationship with the accounting profession.
Accountants are among the most trusted advisers to SME owners, and we believe great accountants can play an enormously valuable role beyond preparing financial statements and tax returns.
They can help their clients understand their businesses.
- Challenge their thinking.
- Identify risks.
- Recognise opportunities.
- And connect them with people and resources that can help them become stronger.
Accountancy Insurance shares that close connection with the accounting profession, supporting thousands of firms and, through them, the businesses and individuals they advise.
That makes them a natural fit within the Global Business Camps community.
We are extremely grateful to have Accountancy Insurance as a Corporate Partner of the 2027 Global Business Camp and to have their specialist knowledge and long-standing support of the accounting profession represented within our broader GBC community.
So here is a question worth asking your accountant:
If my business was selected for an ATO review tomorrow, who would pay the professional costs of responding?
If you don’t know the answer, it might be worth finding out.
And if you are an accountant, it may be worth exploring whether tax audit insurance could provide another layer of protection and support for your clients.
Take a look at Accountancy Insurance and discover how Audit Shield and their specialist insurance solutions are helping accounting firms and their clients prepare for some of the risks nobody particularly wants to encounter.
Visit accountancyinsurance.com.au to find out more.
Looking for solutions to make your business thrive?
Click the link below to Register for our 3-day Camp from 1–3 March, 2027 to learn strategies to finally get your business under control.
https://globalbusinesscamps.com.au/camps-events/register-for-the-2027-camp/
Or if you are unsure, book a discovery call with John Tsoulos on (08) 8423 6177 to learn how this fantastic event could be just what you have been looking for.
