Sometimes you'll be able to handle the matter through the mail, but sometimes you'll have to go to an IRS field office. If the audit includes an extensive examination of records, as in the case of a business audit, an IRS agent may go to the taxpayer's office or to the office of the accountant, if the records are located there. During an audit, you have the burden of proving that your return is correct. So if you don't have documentation, some deductions may not be allowed. However, an examiner sometimes may accept a reasonably estimated amount for expenses that were obviously paid, even without the documentation.
Many audits result in no changes to the tax return, and some audits actually result in a refund.
It's not necessary, but if your situation is complicated, you may want one. Also, if an accountant helped you prepare your return, you probably should consult that person about the audit. Whether or not you will have to pay extra depends on your original fee arrangement. If you paid by the hour, you will probably have to pay extra for the time involved on the audit. If you paid a fixed fee for your return, the audit preparation may be included.