94-020

Response January 13, 1995

Request

July 11, 1994

State Tax Commission

160 E 300 S

Salt Lake City, UT 84134

Dear Ladies and Gentlemen:

XXXXX requests an advisory ruling on the acceptability of accounting and other documents for tax compliance and audit purposes, based on the following scenario:

1. Accounting and other records for purchases, accounts payable, sales and accounts receivable are stored on CD-ROM media, using computer scanning technology.

2. The resulting CD-ROM files are in unalterable form.

3. The files are available for computer display and for hard-copy printing.

4. The printed documents are identified as copies but are otherwise indistinguishable from the originals.

5. Back up copies of the CD-ROM disks are made, and original documents are destroyed.

6. The process is standardized as a regular business practice across the Company’s decisions and facilities, and document retention periods are indicated on an approval records retention schedule.

Thank you for your attention to this request. Please call me at XXXXX if you require additional information.

Sincerely,

XXXXX

XXXXX

January 13, 1995

Re: Advisory Opinion - Acceptability of CD-ROM Media Data Storage and Retrieval Systems as Substitutes for Original Documents

Dear XXXXX:

You requested an advisory opinion as to whether it is acceptable to retain accounting and other records for purchases, payables, sales and receivables on CD-ROM media as opposed to original source documents.

Our research indicates as follows:

1. Record-keeping requirements for sales and use tax purposes are outlined in Administrative Rule R865-19-22S (copy attached).

2. The use of the system as described in your letter is approved to the extent that the system meets the requirements as outlined in the referenced rule for Microfilm, Microfiche, and ADP systems.

This opinion is based upon the facts presented in your letter. Obviously, if there are deviations from these facts, this opinion may be negated.

If you do not agree with this determination, you may appeal to the Tax Commission for a formal hearing. The results of that hearing would constitute a declaratory judgment and be appealable to the Utah State Supreme Court. A Notice of Appeal Rights and a copy of the Utah Taxpayer Bill of Rights are attached.

Respectfully,

Alice Shearer

Commissioner