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Avalara Help Center

Establishing a variance

Establish a variance so that you can quickly identify inconsistent and unexpected data within your Compliance reports after each bill cycle.

Before you begin

Review and reconcile the previous bill cycle.

Guidelines

  • Establish an expected growth rate.  For example:
    • 5% growth based the previous month's totals
    • -2% growth to account for seasonal fluctuations
  • Run a compliance report and review the total liability for each jurisdiction and tax type. 
    • Compare the totals for the current bill cycle to previous bill cycles to identify variances using the Explorer Compliance Report.
  • Use the variance as a starting point for reconciliation.  The variance could be impacted by a number of scenarios:
    • Unexpected changes in your business.
    • Updated tax rates.
    • New account customizations applied to your account.
  • Review the variance prior to each reconciliation and adjust as needed.
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