State the maximum amount of years the Customs authority is empowered to audit the business records of your client.

• A. 2 years
• B. 3 years
• C. 5 years
• D. 7 years

Answer: (B)

Audits are bounded by a look-back period, which is the number of years the customs authority can review records to verify declarations, duties, and compliance. In this context, that look-back period is three years, so the authority can examine the client’s business records for the past three years to detect any underpayments or misstatements. This window strikes a balance between catching ordinary errors and avoiding endless review. If there’s evidence of fraud, concealment, or a special legal trigger, the authority may extend beyond the standard window, but for routine audits the maximum is three years.