Nairobi, Aug. 23 -- A Kenya Revenue Authority (KRA) tax audit is one of those events that most businesses would rather not receive notice of. Yet an audit does not necessarily mean that a taxpayer has done something wrong.

KRA is legally empowered to review taxpayers' affairs to establish whether the correct taxes have been declared and paid. The outcome may be that the taxpayer is found compliant, or it may result in an additional assessment where KRA identifies a tax shortfall.

KRA may undertake returns reviews, comprehensive audits or investigations covering taxes such as income tax, VAT, PAYE, withholding tax, excise duty and customs duty.

A KRA tax audit is essentially an examination of a taxpayer's financial and tax affairs to de...