Sales Tax Audit Numbers not Adding up?

I have an issue and I am hoping for any advice here. I am sure someone here has gone through this.

We have a retail store and our sales tax audit came back with a large gap between our POS numbers and our income tax gross receipts (higher receipt total in POS than the gross receipts by 90k over 3 years)

Now, we were not the most organized company in our first few years, and I know that some of the gaps are returned sales/canceled orders that were not returned in through the pos system.

There were also cash sales that we did not deposit, but nowhere near the amount that's missing.

We paid taxes on the POS systems higher amount but I am very concerned about explaining the gaps.

Have any of you experienced this? How do I handle the gaps and explain it to the state. At this point I know we're going to owe in, I'm just worried about how to go about this.


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