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include the years 1992 through 1996. Upon completing her audit,
Ms. Groom submitted a comprehensive report to Dr. Shlens.
Moonshadows has a dining room and a bar area. During the
applicable period, Moonshadows utilized two cash registers that
recorded dining room sales (register 1) and bar sales (register
2).
To conduct her audit, Ms. Groom used the cash register tapes
from registers 1 and 2 to determine petitioner’s gross sales for
the applicable period. She compared daily sales reported on
sales journals, sales tax returns, financial statements, and
petitioner’s monthly reports that were given to Dr. Shlens. Ms.
Groom also compared the cash register tapes with the daily dinner
and bar sales tickets. She determined that Moonshadows had sales
in the dining area of $1,298,418 from June 1, 1994, through April
30, 1995, and sales in the bar area of $380,520, for the same
period. Ms. Groom’s audit did not include the month of May 1995,
because petitioner’s records for that month were not available
for analysis.
Ms. Groom also determined that for the period June 1, 1994,
through April 30, 1995, the register tapes reported “other voids”
and “voids and overrings” of $23,085 and $237,342, respectively.
In 1997, respondent commenced his audit of petitioner’s tax
year ended May 31, 1995. At that time, representatives of
petitioner informed respondent that petitioner’s sales records
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Last modified: May 25, 2011