How much automation of tax flows is possible?

Transcription

1 How much automation of tax flows is possible? 28 June

2 How to manage the CFO s expectations? Before Planning -> Compliance Limited automation CFO s perspective Now Compliance -> Risk and opportunity management Search for process efficiency and automation CFO s perspective $ $ $$$ compliance planning $$$ planning compliance Tax and TP function = profit center Tax and TP function = cost center!? 2

3 Introduction to best practices What are your key challenges? Compliance cost; Data sourcing; Data reconciliation. Which areas can tax technology cover? Routine compliance; Automated data pick-up; Data analytics. What benefits can you expect? Cost savings; Data integrity; Useful insights. 3

4 Introduction to best practices HR info TP documentation ERP Tax accounting Legal agreements Inventory Magical Technology Solution VAT compliance Audit management General ledgers CIT returns 4

5 Your Tax technology plan Objectives Project implementation Output reverse engineering Plan Functionality selection Organization & governance Workflow selection 5

6 Ingredient 1 Objectives Wages tax VAT compliance? Tax accounting TP documentation Customs & trade Risk analytics Income Tax Return Preparation 6

7 Ingredient 2 Output reverse engineering Source Data Data Import Tax Data Warehouse Output Financials Journal Entries ERP systems Spreadsheets Mapping of data Compliance Risk analysis 7

8 Ingredient 3 Organization & governance Central core team Global lead & policy setting QC & policy Local lead setting Local support Lead QC & policy setting VAT VAT VAT CIT TP Wages tax Local support CIT TP Wages tax Central core team CIT TP Wages tax Shared Service Center Central core team Tax provisions Tax provisions Tax provisions 8

9 Ingredient 3 Organization & governance Head of Tax Lead TP Deputy TP TP Operational Central finance team Local tax team Treasury team Legal team Business team 1. Development / maintenance of TP documentation 2. Consultancy advisory and implementation I A R R C C - I - A R R R C C C I I 3. Audit support I A/R R R R/C R/C C Risk Management A R/C R/C R/C R/C R/C C Systems (central data management & retrieval) 6. Capacity planning insource/ outsource 7. Global benchmarking platform (outsourced to third parties) I A R R R/C C C - - I A R R R/C C I A - R R/C Sign-off TP documents I A R R Legal agreements set up and implementation - C R R I I I A I 9

10 Ingredient 4 Workflow selection How to determine what to automate? Complex / Unique Workflow 1 Average workflow 2 Simple / Repetitive workflow 3 10

11 Ingredient 5 Functionality selection 11

12 Ingredient 6 Project implementation Cost efficiency? Change management Standardization and harmonization Technology / tools As is Future design Outsourcing / co-sourcing Business case 12

13 Ingredient 6 Project implementation Project critical success factors Which elements are fundamental to achieve the project goals? Project approach How to execute your tax technology plan? 13

14 Tax technology planning in practice: case study 1 14 Facts: US headquartered manufacturer of electronic products with subsidiaries in 27 countries across the globe; MNE is required to file Country-by-country reporting; Finance reporting is automated through Hyperion Financial Management ( HFM ); Internal service recharges testing and reporting is based on spreadsheets and is performed manually. Objectives: Automate transfer pricing calculation, reporting and forecasting; Facilitate Country-by-country reporting. Expected benefits: Increase of internal team efficiency; Decrease of compliance costs; Integrity of data; Simplified calculations.

15 Tax technology planning in practice: case study 1 Source Data Data Import Software Output Financials Journal Entries HFM Spreadsheets Mapping of data Calculations Compliance Risk analysis 15

16 Tax technology planning in practice: case study 2 Facts: EU headquartered manufacturer of apparel with subsidiaries in 35 countries across the globe; MNE is required to prepare Local files; MNE does not have common ERP for all subsidiaries; Core team includes 1 Head of tax and 2 Managers. Objectives: Automate Local files preparation and review. Expected benefits: Increase of internal team efficiency; Decrease of compliance costs; Standardize documentation; Avoid local team interference with centrally defined information. 16

17 TPA Global provides international businesses with integrated and value-added solutions in improving financial performance, operational efficiency, strategic development and talent coaching through a cross-border and cross-discipline team of professionals which identifies the right solutions for customers and targets; efficient and streamlined advisory and implementation processes which cut through operational complexities across functions and borders; and superior customer service and support which proactively anticipate the evolving needs of the clients. H.J.E. Wenckebachweg AS Amsterdam. The Netherlands. +31 (0) The views expressed and the information provided in this material are of general nature and is not intended to address the circumstances of any particular individual or entity. The above content should neither be regarded as comprehensive nor sufficient for making decisions. No one should act on the information or views provided in this publication without appropriate professional advise. It should be noted that no assurance is given for any loss arising from any actions taken or to be taken or not taken by anyone based on this publication Transfer Pricing Associates Holding B.V. All Rights Reserved. 17