Transform Today For Challenges of Tomorrow

Transform today for
the challenges of
tomorrow
Plenary
Maison de L’automobile
15 December 2015
Andre Claes – Partner, Deloitte Belgium
Mark Kennedy – Partner, Deloitte UK
Patrick Joucken – Partner, Deloitte Belgium
1
Contents
Introduction
Transformation – why?
Transformation – what and how?
Conclusion
Introduction
Transformation?
"Everything that can be

invented has been invented”
Charles Holland Duell c1899
US Commissioner of Patents
Introduction
Transformation?
Thomas Watson 1943

President of IBM
Introduction
Transformation?
Thomas Watson 1943

President of IBM
“When we set the upper limit of PC-DOS at 640 KB,

we thought nobody would ever need that much memory”
Bill Gates
Chairman and CEO of Microsoft
Transform today for
the challenges of
tomorrow
Transformation –
why?
6
Transformation why?
External trends are impacting Tax …
As business GLOBALIZES … so do tax Increased REGULATION makes business
obligations together with a pressure for more complex but also more transparent
centralized global delivery ... raising risk and enabling mainstream
media coverage
TECHNOLOGY proliferation … fuels

expectations for wholesale process TALENT … new skills are needed and
change, and becomes a catalyst for re- there is a new environment within which
engineering tax to attract and retain people
Transformation of REVENUE New STAKEHOLDERS … have emerged

AUTHORITIES … the way they go about and we are confronted by a new era of
their work socially responsible tax
New practices
and regulations
8
The story so far
• Control powers of tax authorities

• Targeted transfer pricing audits
• Large companies Auditing Centres
• Parliamentary Commission on serious
Fraud
• Generalised electronic filings
• Increased Digital Data requests
• Transparency: exchange of tax rulings
9
International response
OECD’s Base Erosion & Profit Shifting study

The European Response
State Aid
Tax Rulings: automated exchange
Action Plan on Corporate Taxation
Unilateral measures
10
What does it mean?
• More taxes and more reporting in more jurisdictions

• Evaluate the impact of change on tax operations
• Modelling the impact of new measures
• How? New management processes & tools
• When?
11
The Global Tax Reset & BEPS
Country-by-country reporting (CbCR)
This perspective paper aggregates frequently asked
questions by business leaders about Country-by-
country reporting (CbCR), a requirement detailed in
Global Tax Reset: the changing world of tax
Action 13 of the OECD's BEPS guidelines, and is
The Global Tax Reset is bringing in a new era of
intended to help companies understand what CbCR
international tax, with an emphasis on transparency,
is, what information is needed, who CbCR applies to,
consistency and sharing of information between tax
and how businesses can prepare.
authorities. This paper discusses the forces driving
significant change to the international tax landscape,
as well as key areas of business impact and BEPS Actions
resulting challenges. There are 15 BEPS Actions that are currently being
considered and worked on by the OECD. For each of
the Actions, there are factors to consider such as the
About BEPS and FAQs timing, impact and potential impact on policy. The
The OECD’s Base Erosion and Profit Shifting actions OECD/G20 has set a number of deadlines to
are well underway with proposals and consultations conclude on the BEPS Actions.
on all actions. Change is coming. These pages will
help businesses navigate what is happening, key
deadlines and issues they might want to consider. G20/OECD Timeline
An overview of the information and documentation
that has been released by the OECD during the
Articles, briefings and discussion papers course of the BEPS Action Plan, together with
The OECD’s Base Erosion and Profit Shifting actions relevant Deloitte or third party content and
are well underway with proposals and consultations commentary. As well as containing details of all of
on all actions. Change is coming. These pages will the releases to date, the timeline shows what is
help businesses navigate what is happening, key expected over the coming months, in accordance
deadlines and issues they might want to consider. with the schedule published by the OECD.
News & updates Dbriefs webcasts

Visit Deloitte tax@hands for tax news and updates on Dbriefs Webcasts feature our professionals discussing
BEPS and other issues driving the global tax reset critical issues that affect your business.
12
Transform today for
the challenges of
tomorrow
Transformation –
what and how?
13
Tax transformed – the “professionalisation” of tax
Tax Policy Framework
Tax Risk Management Culture

KPIs/KRIs
and
ethics
Report Risks
Tax Vision, Goals People and Processes
Risk Tax Outputs and
organisation
and Strategy appetite Communication
Systems
Oversight Decision
Test Controls making
Control
Accountabilities standards
14
Tax policy,
risk and operations
15
Increasing formalisation of tax policy
Groups are increasingly defining their tax policy Accountabilities for taxes getting clearer
No
23%
29%
Yes, for some areas
Yes, for all four areas 47%
Source: Deloitte Global Market Research, 2014
16
Answering key questions
“How is success Tax Policy Framework “How are key

measured?” decisions made?”
KPIs/KRIs
and
ethics
Report Risks
organisation
Systems
Test Controls Decision
Oversight
making
Control
“What governance “Who owns each

is there over tax?” tax?”

17
Identifying, controlling and reporting tax risks
Groups generally have processes for More and more third parties have a specific
identifying, controlling and reporting tax risk interest in tax risks and how they are managed
• Tax Authorities – e.g. UK,

Australia, Netherlands, Japan,
Spain
• International bodies – e.g. OECD,

EU Commission
• The Press
• Investors – e.g. Local Authority

Pension Fund Forum
• Analysts – e.g. Schroders, Citi
• Indices – e.g. Dow Jones

Sustainability Index, MSCI World
• NGOs – e.g. Tax Justice Network,

Source: Deloitte Global Market Research, 2014 Action Aid 18
Developing a risk-based approach
“How do we report to Tax Policy Framework “What are our key

the Tax Committee?” tax risks?”
KPIs/KRIs
and
ethics
Report Risks
organisation
Systems
Oversight
making
Control
“When is Internal “Who are our ‘lines

Audit testing tax?” of defence’?”

19
Compliance
operating models
20
Global tax operating models
21
Increasingly centralised decision-making
Global tax operating models: past, present and future
Source: Deloitte Global Market Research, 2012 and 2014

22
Pressure for continuous improvement
Satisfaction (% happy) with current model by driver and method
Source: Deloitte Global Market Research, 2014

23
Evolving the operating model
“Do we have the “Can we streamline
right scale, roles, Tax Policy Framework adjacent
locations?” processes?”
KPIs/KRIs
and
ethics
Report Risks
organisation
Systems
Oversight
making
Control
“What is the right “Can we leverage

in/out/co-source our Shared Service

model?” Centres?”
24
Tax technology
25
Tax Department is a large consumer of data
© 2015 Deloitte Belgium 26

Complexity of Tax Technology Landscape
27
© 2015 Deloitte Belgium
Tax transformation framework
Global direct tax
Global indirect tax
Accounting for tax (provision) People
and
organization
Cash tax and payment management Process

and policy
Close, provision, and process
Risk and tax controversy

Strategy and execution
Regulatory compliance
Tax business planning

Technology
and systems
Data and
information
Enablers
28
Value drivers
Conclusion
29
Conclusion
Main points?
1. Policy, Risk and Operations
2. Compliance Operating models
3. Technology
Interconnections – Change management – Communication
30
Conclusion
Agenda of the day
31
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© 2015. For information, contact Deloitte Touche Tohmatsu Limited. 32

Transform today
for the challenges
of tomorrow
Operational
Transfer Pricing
15 December 2015
Maria Panina – Senior Director, Deloitte Belgium
Thierry chaumantin – Senior Manager, Deloitte Belgium
1
Contents
1. Definition
2. Issues & Challenges
3. Solution Framework
4. Implementation & Monitoring – SAP example
5. Summary
1. Definition
3
Definition
Transfer
pricing policy
People, Processes and
Technology employed to
ensure that chosen
business model and
transfer pricing policies are Operational TP
ultimately reflected in its Monitoring Implementation
books and statutory returns
Documen-
tation
2. Issues &
Challenges
5
Issues & Challenges
• TP policy not shared within the organization • No possibility to split P/L per function / profit
and / or not properly followed in practice center / transaction / ...
• Unclear roles and responsibilities: tax team • Inconsistent definitions of P/L elements
often not aware of altered IC transactions • Limited ability to monitor and adjust global
• Disconnect between tax department & other pricing on a monthly or quarterly basis
business departments → Substantial year-end adjustments (creates
• A complex and fragmented architecture with awareness at the level of the authorities)
multiple (ERP) systems • Potential impact on tax (management), both
• A wide variety of GAAP and accounting direct taxes as well as indirect taxes
systems
→ No standardized chart of accounts
• Reliance on a large number of spreadsheets
(highly manual, prone to error)
3. Solution
Framework
7
Solution Framework – Key considerations
Priorities
Policies are Data collection is Calculations and Reporting and Policy or calculation
Audit status is visible
properly translated complete and adjustments are requirements are identified changes effected on a
on a global basis
into practice accurate automated and accurate and fulfilled locally timely basis
How do you get there – some key considerations?
• Who are the people involved in process – are they the optimum people; do they understand their part
in the process?
• Do those involved have clearly defined roles and responsibilities?
• How are training and legislative updates handled?
People • Are key responsibilities understood and allocated to the right people?
• How frequently would the business like the calculation/true-up process to be run in an ideal situation
(as part of each month end close / quarterly / bi-annually / annually)?
Process • Where should the different elements of the end-to-end process be run (usually Finance/Tax/Business
split)?
• What controls should be in place to counter key risks? How are the controls going to be monitored?
Technology
• What technology is used currently to support the people and processes?
• How suitable is that for the complexity and / or risks of transfer pricing within the business?
• Have all technology options been considered given the significant advances in recent years?
• What level of automation is optimum for the business?
People: Clear definition of Roles & Responsibilities
Implementation
TP Policy Monitoring Documentation
process
Tax
Board Finance
• TP policy design
• TP documentation
• TP policy defence
• Implementation
• Data gathering
IT • Monitoring Business
• Identifying changes of facts
• Financial reporting to Tax

• MIS reporting to Business
• Legal entity reporting
Treasury
Operations
Legal
Processes (and data) - Implementation
Budgets:
Available financial data
Segmentation
may be insufficiently
TP policies by products,
segmented
flows and
legal entities
Adjustments Price lists:

need to be Calculation
allocated across 1000s SKUs
of
Automation multiple cost and
Adjustments
centers or SKUs discounts
Adjustments need to
Update of Statutory reflected in statutory
budgets results financials so results
correspond to the TP
policy
Processes– Monitoring
Adjusting books before year end close is a critical component of ensuring

compliance
Considerations
• Indirect Tax & Customs Valuations on
individual product invoices.
• WHT implications of a true-up
payment not linked to specific product
invoices.
• Resources and system capability
required to undertake the adjustment.
• Acceptance of lighter-touch process
in certain jurisdictions.
4. Implementation
& Monitoring
on SAP
12
TP policy: implementation & monitoring on SAP
A combination of SAP modules can be used to effectively implement and monitor

the TP policy
BPC: Budgeting Module - Determine transfer price by product

family based on budget P&L and target Profit Level Indicators
(PLIs)
SD: Pricing Module – Configure transfer price by product

family using appropriate TP mechanism (e.g. cost plus, re-sale
minus) and generate intercompany billing invoices
FICO (COPA): Controlling Module – Analyse PLI variances and

determine transfer price corrections (TP true up adjustments or
transfer price update)
Steering PLI according to TP Policy on SAP
1 2 • These 4 steps will help you to

dynamically steer the PLIs (e.g. OM,
Budgeting solution
e.g. SAP BPC NCP) within the fiscal year according to
Pricing setup the TP policy via:
SAP SD
• Accurate determination of Transfer
Per Price by product family at Budget time
product
family • Adequate implementation of TP
Profitability mechanism (e.g. cost plus for
analysis manufacturer, re-sale minus of
SAP CO-PA
Sales order distributor) at invoicing time
processing
SAP SD
• Dynamic re-calculation of transfer
4 3 price based on actuals & re-
forecasted numbers at Quarter Close
time
1.Budgeting & Transfer Price Determination
1 • Budget input
During the budget exercise, OPEX, sales
Budgeting solution
e.g. SAP BPC
and cost of sales quantities and prices
Pricing setup will be loaded in the system by the
SAP SD business teams
Per • PLI computation

product Based on the data entered, the
family budgeting tool will compute the PLIs by
Profitability legal entity/function
analysis
SAP CO-PA Sales order • Transfer Price margin calculation
processing PLI can be iteratively refined by adjusting
SAP SD
the percentages in the budget tool (cost
plus, re-sale minus) to reach the target
PLI (OM,NCP) by legal entity/function 15
2.Transfer Price Configuration
2 • Standard costs and list prices

Budgeting solution
Standard costs and list prices are stored
e.g. SAP BPC per product (and e.g. customer)
Pricing setup
SAP SD • Transfer price margins
Each transfer price margin (cost plus %,
Per re-sale minus %) will be stored per
product product family/period as a pricing
family
condition
Profitability
analysis
SAP CO-PA
• Pricing procedure (TP mechanism)
Sales order Pricing procedures are defined to apply
processing
SAP SD TP mechanism (e.g. intercompany cost
plus % on standard cost or intercompany
re-sale minus on list price)
3.Intercompany invoicing
• Intercompany invoices can be

Budgeting solution
automatically generated according to the
e.g. SAP BPC TP mechanism (pricing procedures) defined
Pricing setup
SAP SD • Dynamic calculation – unit price
variation
Per The pricing procedure can take into
product account variation in unit price such as:
family
Profitability • Change to the list price
analysis
SAP CO-PA
Sales order • Customer discount
processing
SAP SD • Inventory valuation (e.g. flash title sales
3
vs. sales from distributor replenishment
stocks)
4. Transfer Price Controlling (*)
(*) Combined usage of COPA & BPC to get full picture
actual & budget/forecast numbers
• Analyze Actual PLI (OM, NCP) by segmented

Budgeting solution P&L (legal entity/function)
e.g. SAP BPC Compare actual vs. budget, break-down GM by
Pricing setup product family, identify variance origin (volume,
SAP SD
unit price)
Per • Determine Transfer Price adjustment

product Combine actual YTD plus remainder of the year
family forecasts. Determine transfer price adjustment
by product family (% of cost plus or re-sale
Profitability
analysis minus) to reach target PLI for the fiscal year
SAP CO-PA
Sales order • Implement Transfer Price adjustment
processing
SAP SD Either via transfer price update in SD (adjust %
of cost plus or re-sale minus) or via posting of
4 TP true-up adjustments (generate credit
note/debit note)
Operational TP on SAP – Key considerations
• Budgeting module does not need to be

SAP BPC
Budgeting solution
e.g. SAP BPC Other budgeting tools like Oracle Hyperion,
Pricing setup IBM Cognos TM1, Anaplan can also support
SAP SD this process.
Per • TP on services (cost re-charges) can be

product addressed in a similar manner
family Allocation table in the budgeting system
Profitability
and/or SAP FICO. To apply allocation drivers
analysis to cost centers.
SAP CO-PA
Sales order
processing • Transfer price update & forecast process
SAP SD Updating transfer price on pricing module
during fiscal year to reach target PLI based on
the actuals and the updated forecast
6. Summary
20
Solution Framework- The Building Blocks
Economic analysis and initial
documentation Operational Transfer Pricing
Analytics and
Strategic objective monitoring
setting 1. Process • Validation of policy
operation
• Value-added analytics
and insight
Policy determination
People
2. Organisation Supply Other
Tax Finance Legal Treasury IT
Chain Board, IA
Stakeholders
Reporting
• Country by country
Policy documentation reporting
• Tax return information
• Internal stakeholders
Master File 3. Technology
Legal structure, business Systems

area, intangibles, financial and data
activities, financial & tax info
Audit defence
• Audit defence
approach
Local Files
• Process / workflow
Local mgmt. info, org chart,
• Feedback and update
intra-group payments,
financial data for arms
length calcs., APAs Workflow
Risk, controls and governance

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“Deloitte Network“). None of the Deloitte Network shall be responsible for any loss whatsoever sustained by any person who relies on this communication.

Transform today for
the challenges of
tomorrow
The new Union
Customs Code
15 December 2015
Dries Bertrand – Senior Manager - Deloitte Belgium
Alexander Baert – Attorney-at-law - Laga
1
Contents
Introduction
Introduction of Union Customs Code / Transformation – why?
How does this impact your GTM systems & tools / Transformation – what?
Transform today for the challenges of tomorrow – how?
Conclusion
D. Bertrand & A. Baert - The new Union Customs Code requires new system changes - TMC Conference - 24 November 2015 2
Introduction of
Union Customs
Code
Transformation –
why?
3
From CCC to MCC to……UCC
• Community Customs Code (CCC) and its Implementing Provisions (CCCIP)
• Regulation 2913/1992
• Modernised Customs Code (MCC)

• Goals: Rationalisation, Standardisation, Simplification, Computerisation, Interoperability,
New facilities.
• The Union Customs Code (UCC) package

• Delegated Act – approved by the EU Council and Parliament
• Implementing Act – under discussion
• Publication of both acts expected in the Official Journal in
December 2015
• Entry into force 1 May 2016 and full implementation, using all
simplifications and IT applications by the end of 2020
Aim of the UCC
Facilitation of legitimate trade UCC will modernize
customs and is the
Reinforced need to ensure security and safety new framework on
the rules and
Paperless environment for customs & trade procedures for
customs throughout
Harmonized & standardized application of customs controls
the EU
General overview of potential impact of the UCC
Authorized
Economic
Operator
Simplifications &
Classification
IT environment
UNION
CUSTOMS CODE
Customs
Origin
Regimes
Customs Debt &

Customs Value
Guarantees
UCC Projects Timeline
Target date of S1 S2 S1 S2 S1 S2 S1 S2
UCC Projects related to electronic systems
deployment 2017 2017 2018 2018 2019 2019 2020 2020
1. UCC Registered Exporter System (REX) 01.01.2017
2. UCC Binding Tariff Information System (BTI) Update - Phase 1 01.03.2017
Staged 2. UCC Binding Tariff Information System (BTI) Update - Phase 2 01.10.2018
3. UCC Customs Decisions 02.10.2017
approach of 4. Direct trader access to European Information Systems
02.10.2017
(Uniform user management & digital signature)
implementing IT 5. UCC Proof of Union Status (PoUS) 02.10.2017
projects / 6. UCC AEO updates 01.03.2018

7. UCC New Computerised Transit System (NCTS) update 01.10.2018
solutions 8. UCC Surveillance 3 02.10.2018
9. UCC Automated Export System (AES) 01.03.2019
10. UCC Information Sheets (INF) for Special Procedures 01.10.2019
11. UCC Special Procedures 01.10.2019
12. UCC Notification of arrival, presentation notification and
02.03.2020
temporary storage
13. UCC Centralised Clearance for Import (CCI) 02.10.2020
14. UCC Guarantee Management 02.10.2020
15. UCC Safety and Security and Risk Management TBD
16. UCC Classification (CLASS) TBD
© 2015 Deloitte. Private and confidential.
How does this
impact your GTM
systems & tools
Transformation –
what?
8
Example of potential impact of the UCC
3. Origin (BOI)
EUROPEAN UNION/SWITZERLAND
USA
India
6. Customs
Debt
I E
M X
8. Simplifications and IT
systems
2. Classification (BTI)
5. Customs Clearance
4. Customs Value 7. Special Procedures
1. Authorized Economic Operator
Customs & Global Trade IT processes
CGT processes need to mapped, put in SOPS and build into technology. The complexity with customs & global trade
processes is the ‘real time’ transactional match between financial data and logistics data where content constantly
needs to be up to date. Economic operators lack such environment and have no or limited governance models in place
GTM technology
ERP
Customs/VAT/Stati
(SAP ECC6) Master Data*
Feeder Conversion
Authorities
stical…
provider
Systems
• Sales and Distribution
• Materials
Management
Trans. Data
• Logistics Execution Master
• … Data
Global trade master data – UCC impact
Master Data Management
Business Bill Of Classificat

Product Rates Origin Licenses
Partner Material ion
Product Economical Customs codes Import/Export

Customers BOM Duty Rates Licenses
data Origin (HTS/CN Code)
Export Control
Product Exchange Preferential Codes License Rules
Vendors values Rates Status (ECCN/ECN/
ITAR)
Banks Letter of Credit
ERP
ERP/Global Trade
SPL List
Global Trade
Global trade functionalities – UCC impact
Regulatory Customs Special Preference Other trade
management management regimes management compliance
Black List Product Supplier Declaration

Excise warehousing Intrastat reporting
Screening Classification Handling
Embargo FTZ/ Bonded Preference

Country of Origin Letter of Credit
Screening warehousing Determination
Product Customs Certificate

OGA management Processing Management
Classification
Export License Brokerage / e-filing

Duty Drawback
Screening declaration model
Import License
Screening
The Four Keystones of CGT management
Technology Data Management
• Restricted party screening • Master data management
• Embargo screening • Data quality management
• End-use screening • Global trade content
• Anti-boycott screening • Restricted parties/entities
• Classification management • Embargo lists
• License management • Classification data
• Free Trade Agreements management • Systems role definitions
• Import/Export filing • Data tagging
• Trade document generation • Data access policy management
• Broker integration Technology Data
• Metrics and reporting
Management
• Records retention
• Metrics and reporting
• Workflow and rules
Processes
People &
&
Organization
Procedures
Processes & Procedures People & Organization
• Service provider management • Leadership and commitment
• Customs filing • Policies definition and management
• Applying for licenses • Culture of awareness
• License reporting • Global regulatory knowledge
• Agreements reporting • Regional regulatory knowledge
• Mergers and acquisitions advisory • Technical regulatory knowledge
• End-use research and assurance management • Systems and tools proficiency
• Anti-boycott research and assurance • Cross functional collaboration
management
• Training
Transform today for
the challenges of
tomorrow
Transformation –
how?
14
Summary – Points of attention
Only 6 months to go to have a number of key processes,

01 authorizations, systems and control changes in place
02 Master data will need to be reassessed
03 Compliance procedures will need to be reassessed
Processes will need to be reconsidered from a financial

04 point of view
05 Internal and external processes and relationships are in

scope
What do you need to do?
• 1 May 2016 will be here soon
• A thorough assessment of the

impact of the UCC is necessary
• A project plan & strict timeline

must be drafted in order to
implement the changes of the
UCC in a strict and concise way
Way forward
OPPORTUNITY AWARENESS
SPOTTING / &TRAINING
RISK
MITIGATION
Unlocking the ADAPTING PROCESSES &

PROCEDURES
potentials of the UCC
while being/growing
compliant
UCC
Thank you
Q&A
Fernand Rutten, Partner, Customs & Global Trade, Global lead, +32 2 600 66 06 or frutten@deloitte.com
Dries Bertrand, Customs & Global Trade, Senior Manager, +32 2 600 66 76, dbertrand@deloitte.com
Alexander Baert, Attorney-at-law, Laga, +32 2 800 71 51 or abaert@laga.be
Transform today
for the challenges
of tomorrow
Centralized VAT
compliance
Christophe De Waele - Deloitte

Sabine Boone – Deloitte
1
Contents
• The Current Landscape
• The Push to Centralisation
• Components of Compliance
• Focus on Technology : The SMART example
• Executing on strategy
In Deloitte’s 2014 indirect tax client
survey, our clients identified indirect tax
compliance as their number 1 priority
area.
Only 30% of respondents to our global
compliance survey were happy that their
centralised compliance processes were
efficient.
The current landscape
4
Pressures on indirect tax teams
Increasing
scope of
‘indirect’
taxes
VAT is a big number Behaviour-based penalty regimes
Imposed risk management

regimes such as SAO
The tax Desire to “do more” with
the same resources
team
Public scrutiny and board New resourcing and delivery

room attention models, such as SSC/GBS
More to manage alongside greater scrutiny over performance and compliance

Operating model evolution
The evolution of compliance strategy from discrete functional-
and country-based models to integrated, global and cross functional services
Operating model
Outsourcing model Decentralized Coordinated, consolidated Centralized, Integrated
Degree of automation Limited automation Medium automation Maximum automation
SSC geographical scope Local Regional Global

Degree of
value add Transactional Sharing of tools and processes Transactional and advisory
Functional scope One function Two to three functions Multi-function
Degree of functional
integration Little sharing Co-location Full integration
Prepared by separate local Tax and statutory accounts Shared service team prepares tax
Tax and statutory country teams processes aligned returns and statutory accounts
accounts
With ad-hoc use of advisors on Co-ordinated global outsource Local support for quality
country by country basis working with SSC assurance and specialist input
The push to
centralization
7
Market research - Compliance focus
Current global compliance drivers for organisations and their management
Relative importance of factors in %
* Global CRS Transformation survey conducted by Deloitte – December 2014

Satisfaction with the current model for managing global compliance
(% Happy)
Method 1 Method 2 Method 3

Decentralised Co-ordinated Centralised
Delivered and Delivered locally, Delivered and

managed locally managed centrally managed
centrally
Satisfaction with the current model for managing global compliance
Does not perform as well for…
Indirect tax Global tax Statutory Corporate income

returns and payments provision accounts tax returns and payments
21% 7% 5%
14%
Specific issues…
• Lack of control; • Lack of control; • Lack of control; • Lack of control;
monitoring; monitoring; monitoring; monitoring;
management management management management
• Complications of • Lack of • Less focus on • Lack of
local knowledge communication these areas communication
from external from external
• No central strategy • Problems with data
partners partners
collection/
• Lack of skills/ integration • No central strategy
expertise
• Lack of skills/
expertise
Market research - Key messages
• More centralised operating models • Increased use of selective outsourcing to

being deployed but the degree of complement the in-house team and as a
‘enthusiasm’ varies by process catalyst for wider improvement or even
transformation
• The focus is now on more consistent

global processes and quicker, simpler
delivery, often through the better use of
technology
Components of
tax compliance
12
The components of centralising compliance
Centralisation of compliance
People Knowledge Processes Technology
Local expertise
The right mix of people
People
People
An multi-disciplinary team comprising:
• Tax technical specialists

• Data management resources
• IT and Excel skillsets The right mix of talents to consolidate and
test data, submit returns, adapt systems
• Accounting knowledge
and handle relationships with wider
• Project & Process managers and owners business and local tax authorities
• 3rd party providers where appropriate
Nationalities Skill sets

Knowledge is a key to success
Knowledge
Knowledge
Expertise
Combination of
Practical “problem solving”
Strong Tax technical knowledge
experience
Supported by
Continuous professional training
Regular updates of knowledge databases
Periodical
output
Updated tax Information EMEA Tax matrix and Innovative EMEA Tax
Periodical Newsletters
per country overviews tools
Reliable processes
Processes
Processes
• Important to recognise what
‘compliance’ encompasses
• Preparing the return is a single step in the

cycle
• Centralising compliance will surface pain

points that need to be addressed
• We’re becoming more adept at segmenting

and aligning steps across processes
• Styles of process improvement look different

across businesses but key steps are often
common
Technology trends
Processes
• VAT compliance technology market still evolving: Technology
− The number of international solution providers is increasing: with an eye on

making the most of an under exploited market.
− Differing views on how much integration with the source financial systems is
needed
− Still a lot of excel automation being offered in the market
− No solution does it all… yet
• Underpinning technology solutions are supporting more flexible approaches to

delivery. Clients deciding how much Indirect Tax compliance they want to share
with a service provider will replace the ‘binary’ in house vs. outsource decision.
• The systems for managing the tax process, KPI data and document
management are becoming ‘standard’ in many Tax functions, but adoption and
approach vary from group to group.
The SMART example
18
© 2014 Deloitte LLP. All rights reserved.
Why SMART?
Centralized approach to compliance
Deloitte centralized approach to Pan European compliance… …leading to challenges
Global
operating
+ models
200 CLIENTS 160 +EMPLOYEES
Limited
30 are large outsourcing accounts Including people of16 different standardization
covering Europe and the globe nationalities Variance in data Numerous data
& automation, sources
quality
higher risks, and
ISAE 3402 lack of control
43,000 certified
+
INDIRECT TAX RETURNS PER YEAR (former SAS 70)
Data integrity
SMART as an enabler to standardization and centralization of compliance
Data Data Data Deliverables Review & Submission Management

Planning
Collection Validation Processing Preparation Sign off & Archiving Reporting
Semi automated tools Semi automated

Return
Excel Manual entry tools
generator Excel review
tracker SMART: automated processing
Manual checks and adjustments application
sheets
in e-filing
software
VAT cube Excel reports
© 2015 Deloitte
What is SMART?
End-to-end Indirect Tax Compliance Solution
SMART is an application developed by Deloitte that bridges the gap between
companies’ ERP systems and their global indirect tax reporting obligations.
Company data sources Reporting requirements
Legacy
ERP Systems ITX Listings
returns Reports
Flat files
DWH
SMART key features
• Flexible set-up
• Data cleansing and consolidation
• 35+ Quality checks
• Ready-to-file ITX returns
• Full audit trail
• Standard management reporting
© 2015 Deloitte
Executing the strategy
21
Executing your strategy
Consider VAT’s position within the wider business
Identify your key stakeholders and determine how to work with them
Take stock of what technology solutions are already available in the GBS and
across your tax groups: you may have more to play with than you expect
Focus on complementing and improving current processes
rather than disrupting them
Don’t overcomplicate things: it puts adoption of change at risk
Technology is not a ‘silver bullet’. Sustainable improvement takes care

and effort
There’s more than one route to ‘best in class’


Transform today for
the challenges of
tomorrow
The hidden
challenges of country-
by-country reporting
15 December 2015
Lucas Yüksel – Director, Deloitte Belgium
Mourad Chatar – Senior Manager, Deloitte Belgium
1
Contents
1. Introduction
2. Global tax reset
3. What are the new requirements?
4. How to get prepared ?
5. Conclusion
1. Introduction
3
1. Introduction
New stakeholders in the tax landscape The perception of tax avoidance has
become a reputational risk
Customers
/ Suppliers
Media /
Volatile NGO’s /
economic Lobbyists
environment
Share
holders /
Boardroom
Increased
Technology
complexity of
challenges
legislation
Tax & Legal CFO / Tax
Risk Dir / Staff
Management
OECD /
BEPS
Globalized More vigilant
business tax
models authorities
EU / Anti-
abuse
National
tax
authorities 4
2. Global tax reset
5
2. Global tax reset
BEPS Actions Related to Transfer Pricing
Action Plan
G20 leaders meet delivered to G20 Finance Ministers
Late 2013
November 2012 Feb 2013 July 2013
Early 2014
“Addressing Base Discussion drafts, public

Erosion and Profit comments, public consultations
Shifting” published on 2014 deliverables
September 2014 September 2015 December 2015
• Digital economy • CFC rules • Interest deductions – phase 2

• Hybrid mismatches • Permanent establishments • Harmful tax practices – phase 3
• Harmful tax practices – phase 1 • Interest deductions – phase 1 • Multilateral instrument – phase 2
• Treaty abuse • Harmful tax practices – phase 2
• Intangibles • Risk and capital, other high-risk
• Transfer pricing documentation transactions
• Multilateral instrument – phase 1 • Disclosure of aggressive tax planning
• Dispute resolution
• Data collection and analysis measuring 6
BEPS
2. Global tax reset
Unilateral measures
7
2. Global tax reset
Example of Unilateral Measures
Anti-hybrid rules introduced and proposals are discussed in the digital area
Announced reform of the corporate tax system to align on international tax law
Legislation on the double Irish Tax structure applicable since 1/1/15 with a 6-
year transitional arrangement.
Law dealing with cross-border transactions incl. advertising industry &

digital economy enacted
Introduction of the tax on diverted profits. Applicable as from 1/4/15

8
2. Global tax reset
The CbC revolution
BEFORE AFTER
CbC Reporting
2. Global tax reset
Action 13: timing 1st CbC reporting
2016 2017 2018
Preparation of Filing of the 1st Transmission of the 1st CbC

the 1st CbC CbC to concerned tax authorities
Next steps
• Adoption of new documentation requirements in domestic legislations;
• Creation of a centralized exchange platform for tax authorities;
• Formal signing ceremony of MCAA (January 2016).
• 2020 ?
10
2. Global tax reset
Action 13: Country-by-Country reporting implementation package
Article 6 of the proposed Model Legislation

Country tax administrations should use the report to:
- Assessing high level Transfer Pricing Risks where “effective risk assessment becomes an
essential prerequisite for a focused and resource-efficient tax audit”
- Assess other Base Erosion and Profit Shifting risks in country
Transfer Pricing adjustments imposed by country tax administration shall not be based on CBC
reports: “Country by Country report on its own does not constitute conclusive evidence that
transfer pricings are or are not appropriate”
11
2. Global tax reset
Current view on CbC implementation
Already implemented /
Implementation in progress
Expected to implement
Hard to predict
Further to the release of final report on Action 13, the three-tier documentation package is designed to be implemented via
changes in domestic law by the end of 2016. 12
3. What are the
new requirements?
13
BEPS-driven structure of transfer pricing documentation

Implementation framework
• Country-by-Country reporting to be filed from for fiscal years beginning
Timeline on or after 1 January 2016. First report due in 2017.
• Filing no later than 12 months after the last day of the Reporting Fiscal
Year of the MNE Group.
• Country-by-Country reporting would be required for MNEs with

Threshold
revenues above 750 million Euro.
• Jurisdictions should require CbC reporting from ultimate parent entities

Filing & of MNE groups resident in their country.
information • Automatic information exchange with the relevant qualifying
exchange jurisdictions in which the MNE group operates.
• Emphasis on the need to protect confidentiality of the tax information.
15
Implementation framework
• Ultimate parent of MNE groups or

Reporting • Another Constituent of the MNE when the ultimate parent is located
Entity in a country not having a Qualified Competent Authority Agreement
or is in Systemic Failure
• MNE may chose another Constituent Entity to file the CBC
• Any Constituent shall notify the tax authority of its tax residence
country whether it is the Ultimate Parent Entity or Surrogate Parent
Notification Entity who files the CBC Report
obligation • If the Constituent is not the Ultimate Parent or Surrogate UP, it shall
report the identification and address of the UP or SUP.
16
Content CbC reporting
1 Overview of allocation of income, tax and
business activities by tax jurisdiction
2 List of constituent legal entities

and business activities by tax
jurisdiction
3 Additional information to facilitate

understanding (*)
(*) Source of data, FX rates applied,…
17
1. Overview of allocation of income, tax and business
activities by tax jurisdiction
18
2. List of constituent legal entities and business activities by
tax jurisdiction
19
Allocation of income, tax & business activities
Balances
Stated Capital
Overview of allocation of income, B/S  Cumulated Earnings
1 tax and business activities by tax
jurisdiction Tangible Assets(*)
 Profit/Loss Before Tax

P  External Revenue
&
L  Intercompany Revenue

 Current Tax Expense
HR Data
Transaction
#  Number of Employees Item  Income Tax Paid

20
(*) excludes cash & cash related
21
4. How to get prepared?
Different operating possibilities
Insource Co-source Outsource
• Potential lack of • Access to expert • Access to expert

expert knowledge knowledge and knowledge and
• Potentially more network network
expensive • Integrated approach • Free up in-house
• Risk of other resources
priorities • Customised
solutions
• Consistent and
proven approach

Data collection strategy: Local Vs. Central
COLLECT FINANCIAL DATA LOCALLY IN LOCAL GAAP FORMAT
+ no need to reconcile CbC reporting with local filings

- time consuming data collection process
COLLECT FINANCIAL DATA CENTRALLY IN MGMT. GAAP FORMAT
+ less time consuming data collection process

- need to reconcile CbC data with local filings
23
Identifying & extracting the right financial data source
Point of attentions
Which System to use?  Number of System Instances

 Granularity of Chart of Account
 “Legal Entity” Dimension
Accounting System Consolidation System DataWarehouse

(ERP) (EPM) (BI)
 SAP ECC  BPC  BW
 Oracle EBS  HFM  OBIEE
 PeopleSoft  Cognos Controller  Cognos TM1
 JD Edwards  Other…  ..
 Other…
24
Leveraging on an end-to-end statutory compliance process
Process Data Deliverable Review & Sign Submit & Mgmt.
Data Collection Data Validation
Planning Processing Drafting off Archive Reporting
• Calendar of • Provide data

• Review and
Client internal and legal • Business information update • Clarify/confirm ad hoc matters
approve
due dates • Submit
Financial
Integrate CBC additional data Statements
Deloitte points in PBCs: • Review of Financial Statements Review and CIT return Consolidate
Local - Tax Cash and equity CBC & TP CBC report
Team - Income by party • Review LTP, CITR ratios
(IC/external)
• Identify, prepare and document

• Upload TB’s Mgmt to Local GAAP and tax
• Review and agree
• Update mapping adjustments • Store on
Deloitte calendar
• Upload integrated PBC data • Preparation of local GAAP TB, Deloitte Tax • Data analytics
Central • Governance and
• Check completion of PBC Financial Statements and equity Insight
process
• Conduct integrity checks reconciliation
• Prepare LTP, CITR
Deloitte Conversion Tool (DCT) CBC reporting Tool

Supporting
Technology
E-filing software 26
Technology : Deloitte CbC reporting solutions
Important note regarding attest clients: Neither CbC Digital Exchange (CDX) nor CDX+ (TMC tool) have been
approved for use by Restricted Entity Clients. Consult a QRM before discussing with a Restricted Entity.
• Multiple ERP or
no ERP
CDX+
Technological Maturity
• No dual GAAP
capabilities in
system or not
maintained /
used currently
• No uniform
Statutory
Accounts
CDX Process /
System (Excel
based
adjustments)
Functional Capabilities
26
CbC first experiences
Taxpayer: case 2
Ratio 1 – Accumulated earnings vs Assets
As one can observe, CbC reporting eases the identification of tax / profit
discrepancies among Group (per country) from a high-level perspective.
28
CbC first experiences
Taxpayer: case 2
Ratio 1 – Profit before tax vs Employees
As one can observe, CbC reporting eases the identification of

substance / profit discrepancies among Group (per country)
from a high-level perspective.
29
Technology: Deloitte CDX / CDX+ - Live Demo
CDX: Data Collection - TP Ratios
29
Technology: Deloitte CDX / CDX+ - Live Demo
CDX+: Audit Trail to Financial Systems - IFRS to Stat Rec - TP Ratios
30
5. Conclusion
31
5. Conclusion
Key considerations to address in a CBC discussion
Risk Management
What/Where are the Group “material” legal entities?
Tax Audit Readiness

Can the main statutory differences be explained?
Opportunity
What else can be done with “CbC-like” data?
25
5. Conclusion
CbC readiness requires
1. Setting of risk objectives

2. A risk mitigation strategy
3. Transformation of processes
4. Implementation of adequate Technology
33

Transform today for the
challenges of tomorrow
Electronic tax audits:
Trends, risks and
approaches
15 December 2015
Rainer Eismayr – Director, Deloitte Germany
Pieter Van Dyck – Manager, Deloitte Belgium
1
Contents
Market trends & SAF-T in general
eAudits across Europe
Our approach & typical challenges
eAudit in Germany: deep dive & case study
eAudit in France: deep dive & case study
eAudit & your organisation

Market trends &
SAF-T
3
E-Data requirements
Common IT & ERP Landscape
Financial systems Tax compliance and assurance system Reporting
and fillings
Extract
Main ERP Tax desktop
Tax process management

ERP ERP
Analysis,
Analysis, Reporting
Tax data warehouse
Transform
ERP
calculation,
calculation, and fillings
adjustments
adjustments
Legacy
General ledger
data Tax forms
Income
L1 L2
Transactions Tax software
data store Adjustments
data
Load
Other Tax provision Provision reports

software
Apportionment
Results data
Manual data Documentation Sales/use tax
management software Ad hoc reports
Depreciation
E-Data requirements
Available Data
Tax return data, Electronic data

E-Tax Balance access during Tax Authority
Sheets, XBRL tax audit Risk Monitoring
(comparable to and Management
SAF-T)
Systems
TP
documentation Bank data
Country-by- Reporting data
country Other data
reporting
E-Data requirements - Annual data mining
Hidden data Known output
II. Tax
Determination
III. Tax Reporting

Accounts
Payable
Sales and Use Tax
Accounts Excise Tax

I. Master Data Tax Code
Receivable
Customs
IFRS
Transfer
Pricing Cross border reporting
SAF-T
SAF-T: General
• General ledger
Periodically per legal entity • Accounts payable
• Accounts receivable
• Fixed assets
Master data
• Inventory
Trans-
action Several audit domains:
• VAT
Balances
• CIT
• Transfer pricing
• …
eAudit across
Europe
8
eAudit across Europe
Priority 1 countries
Germany
Luxembourg
Poland (mid 2016)
France
Hungary (2016)
Portugal
Priority 1
9
Priority 2 & 3 countries
Priority 2
Priority 3
Medium
Low
• Austria • Czech Rep
• Bulgaria
• Belgium • Denmark
• Cyprus
• Finland • Netherlands
• Greece
• Ireland • Norway
• Italy
• Spain • Slovenia
• Latvia
• UK • Sweden
• Lithuania
• Switzerland
• Malta
• Romania
Different levels of complexity & likelihood
High
France Germany
• Any tax audit • At discretion of tax auditor

• Local GAAP • All tax relevant data
Likelihood
• Scope of requested data can vary
Luxembourg
• Exemptions for FSI
• SAF-T Lite
Low
Less data Complexity More data
Our approach &
typical
challenges
12
Our approach
Step 1 Step 2 Step 3 Step 4 Step 5 Step 6 Step 7
Technology Organisatio
n
Analyze Extract Complement Reconcile Format Explain Archive
> Review Extract the tax Add relevant Reconcile tax Format Tax Prepare Store tax
significant relevant data working eAudit file eAudit File explanatory eAudit Files,
Business from the ERP documents: with working according to notes Supporting
event for the system. documents local regarding the Documents &
period > GAAP to requirements various data Explanatory
Tax relevant Stat sets (eAudit notes on a
> Review data depends conversion file File, working CD/DVD/Hard
Accounting on the documents,..) drive
systems jurisdiction > VAT
landscape computation
> Review tax

audit history
Typical challenges
• What data?
Data Extraction • How to extract it?
• What about complex IT infrastructure?
• …
• Balances & transaction

Data Reconciliation • Extracted data & local financial statement/CIT return/VAT return
• What about large amount of transactional data?
• …
• Format of the tax eAudit file

Data Formatting • Explanatory notes
• Language difficulties
• …
14
eAudit in
Germany
15
eAudit in Germany
Introduction
The rules governing the powers of the tax authorities are set out in detail in the German
Principles of electronic archiving of accounting and tax information, Data Access and the
Auditability of Digital Records (“GoBD”).
These rules define 3 levels of data access
• Direct (Z1)
• Indirect (Z2)
• eAudit file (Z3)
The eAudit file needs to contain all tax relevant data. German tax legislation does not provide
formal specifications regarding form & content of the tax eAudit data file.
eAudit in Germany
Most commonly resquested data
DATA TYPE DATA DEFINITION EXAMPLES OF DATA FIELDS
Master Data GL Account GL Account Number, GL Account Description and GL account class
Master Data Customer Master Customer ID, Customer Name, Customer Country and Customer VAT Number
Master Data Vendor Master Vendor ID, Vendor Name, Vendor Country and Vendor VAT number
Master Data Tax Code Tax Code ID and Tax Code description
Master Data Journal Category Journal Code, Journal Label (Invoice, Payment, FA, Manual)
Balances GL Account Balance Fiscal Year, GL Account Number, Opening balance, Total Debit, Total Credit, Ending Balance,..
Balances Customer Balance Fiscal Year, Customer ID, Customer Opening Balance, Customer Ending Balance
Balances Vendor Balance Fiscal Year, Vendor ID, Vendor Opening Balance, Vendor Ending Balance
Fiscal Year, Fiscal Period, Journal Code, Journal Name, Journal Date, GL account Number,
Transactions GL Journals
Journal Description
Fiscal Year, Invoice Number, Invoice Date, Invoice Gross amount, Invoice Tax, Amount,
Transactions Invoices/Credit Notes
Vendor/Customer ID, Tax Code
Transactions Payments Fiscal Year, Payment Number, Payment Date, Payment Amount, Vendor/Customer ID
17
eAudit in Germany
Risks & Penalties for non compliance
Penalties up to 250.000 EUR in case:
• Electronic bookkeeping maintained abroad without prior authorization
• Data access not provided to tax auditor within a reasonable timeframe
Bookkeeping not kept in accordance with German tax Law can lead to:
• Ex-officio assessment (Estimation of German tax base)
• Electronic bookkeeping (Server) to be relocated (back) to Germany
• GL bookkeeping process of German Tax Payer to be relocated (back) to Germany
18
eAudit in Germany – Periodic data mining
Tools & Auditing method used by tax authorities
• Electronic tax data testing

AIS Tax Audit and
IDEA • Software publicly available for sale
• Set of different macros at disposal

Macros
• Reproduce typical tax audits tests for income, wage and
value added tax
19
Tools used by the German tax authorities
Example: Tax officer looking for non-deductible expenses for tax purposes
• AIS Tax Audit: query to detect non-deductible expenses like donations, penalties or
presents which are not accounted correctly
• Following steps are carried out by the tax officer:
1. Mapping of the relevant fields
2. Determination of filters (e.g.: GL accounts, keywords)
3. Preparation of a file including the relevant accounting lines
4. Preparation of a documentation regarding the findings
Example / best practices
A. Mapping of the relevant fields Mapping
Required ERP
data fields tables as
to uploaded
perform into the
the test software
macro by the tax
auditor
B. Determination of filters (eg GL accounts, keywords)
• Limitation of GL accounts to be scanned
• Determination of keywords included in the posting text eg “Hotel”, “Gift”
Enter search
terms
Input range
of accounts
to perform
the test on
C&D. Non- deductible expenses – result & documentation
Print report
Test-macro result
C&D. Non- deductible expenses – • All validation routines in the software
result & documentation can be performed
by the tax auditor in one batch, i.e.
• Direct display findings with regard to
very low effort with a
the non-deductible expenses
high statistical likelihood to find errors
> all expenses are booked correctly /
leading to additional
incorrectly
tax assessments at the end of the tax
• Tax auditor can prepare a audit
documentation regarding
his / her findings during the audit
eAudit in Germany
Case study
Situation: • 2013: the former ERP system was
changed to SAP ERP 6.0. The data
• Multinational US headquartered
has been archived electronically by
group in the biopharmaceutical
the IT department without consulting
industry had a tax audit ongoing
the tax / accounting department
(income tax and VAT) for the years
2008 – 2011 • The tax auditor request:
• The accounting was done in a • a direct access to the ERP system
Shared Service center in Poland but of the German subsidiaries for the
the German tax authorities were not years under audit (Z1 access)
informed prior to relocating the
• alternatively an electronic audit file
accounting to Poland
for tax for each entity and year
eAudit in Germany
Case study
Issue:
An analysis revealed that the former system could not be restored. A review of the
electronic data files showed that the data was not in line with the German financial
statements as the US-GAAP to German GAAP bridge was missing in the data
files.
Tax auditor threatened to estimate the taxable profits which would have led to
additional income taxes of approx. € 5mio.
eAudit in Germany
Case study
Outcome:
Client had to
• Go through a full restructuring exercise of the electronic raw data to prepare the
data in accordance with the financial statements in order to avoid an estimation
of the tax base and a relocation of the accounting back to Germany
• Draft new eAudit files for all years under audit
Recommendation:
Prepare the electronic audit files each year together with the filing of the tax return
in order to avoid issues with the tax authorities in a later tax audit.
eAudit in France
28
eAudit in France
Introduction
eAudit Legislation into force since A transactional French GAAP tax eAudit
01/01/2014 for all years open for audit file (FEC - Fichier d’Ecritures
Comptables) must be submitted to the
The eAudit legislation is applicable on:
French tax administration (FTA) at the
• Legal entities beginning of the tax audit.
• Branches The eAudit file has a fix format and

contains 18 mandatory fields
• Non established VAT registered
entities
eAudit in France
18 mandatory fields
Field name Information
1. JournalCode The journal entry code
2. JournalLib The journal entry label
3. EcritureNum The accounting entry number
4. EcritureDate The accounting date
5. CompteNum The account number
6. CompteLib The account label, under the French Accounting Plan
7. CompAuxNum The sub-ledger account number
8. CompAuxLib The sub-ledger account label
9. PieceRef Supporting document reference
10. PieceDate Supporting document date
11. EcritureLib Accounting entry label
12. Debit Debit amount
13. Credit Credit amount
14. EcritureLet “Apply-to/clearing” entry
15. DateLet Clearing date
16. ValidDate Posting date
17. Montantdevise Currency amount
18. Idevise Transaction currency name
eAudit in France
Risks & penalties for non-compliance
Limited administrative penalty, eAudit file remains due
Application of the ‘ex officio’ procedure
• Reversal of the burden of the proof from the start of the audit
• Additional 100% penalty computed on additional amounts of taxes to be paid at
the end of the audit.
eAudit in France
Case study
Situation: After testing the file is provided to the
auditor.
A multinational operating in the IT
industry has an tax audit ongoing (VAT The auditor challenges several entries
& CIT) and generates the eAudit file for as it seems that eg some sales invoices
3 years. are booked as cost minus instead of
revenue.
The client engages Deloitte for a
technical validation of the file.
eAudit in France
Case study
Issue: Outcome:
Analyses disclose that the mapping Client had to
done between management GAAP and
• Revise mapping & update their ERP
French GAAP is incorrect. Several
system
turnover accounts in management
GAAP are mapped to French costs • Draft 3 new eAudit files
accounts etc
• Draft 3 corrected financial statements
Additional, the processes were heavily
challenged and an additional IT audit
was launched.
eAudit & your
organisation
34
eAudit & your organisation
Conclusion
• Policy review • Data sources
• Process manuals • Data collection
• Training • Data limitations
• Roles and • Audit trail
responsibilities • Legacy systems
• Large volumes
• Local adjustments
• Extraction programs • Reconciliations
• Assembly & storage • Extraction – storage
• ERP localizations

Transform today
for the challenges
of tomorrow
Invoice
Management
15 December 2015
Hilde Vandeperre – Director, Deloitte Belgium
Sara Claeys – Manager, Deloitte Belgium
1
Contents
1. Introduction
2. Sales invoices
3. Purchase invoices
4. Other relevant documents
5. Conclusions

Introduction AUTOMATION
Automate as much as you
can but in a smart way.
HIGH VOLUMES LEGISLATION
How to deal with high volumes Although largely
of invoices in an efficient but harmonized, we need to
VAT compliant way? check which Member
State’s rules apply.
REPORTING
CHANGE MANAGEMENT
VAT reporting should be
Make a proper case study and
possible in an easy manner,
make sure everybody is on ANALYTICS avoiding human intervention.
board when automating.
Set up in such way that invoices
can be easily checked in an
automated way
Sales invoices
© 2015 Deloitte Belgium² 4

Sales invoices
How to deal with sales invoices in an • Use of a portal

efficient and VAT compliant way? • Use of a platform
Things to consider: • Some numbers
• Invoice lay out • Paper
• Tax code determination • Storage of your sales invoices
• Exchange of invoices to customers
• E-invoicing
• E-mail with PDF
• Point to point communication

Sales invoices – lay out of your invoices
The importance of the lay out of your • Ideally contain intrastat info – if needed
invoices is often underestimated. • Is customer using OCR?
An invoice needs to be • You may not know but a lot of
• Clear at first glance companies do nowadays
• Interpretation is per se not OK • Then your invoice lay out matters
• VAT compliant at minimum (e.g. templates, standard ERP lay
outs)
• Extra fields like a ship from are very
useful • Is a document that your customer
receives and needs to work with.
• Internally
• And for the customer

Sales invoices – tax code determination
Typically all parameters are known to have a tax code determined automatically by the
system.
A typical SAP example:
CoD CoA MTC CTC + Tax code
E.g. BE BE 1 1 A1
E.g. BE BE 2 1 A0
E.g. BE AT 1 1 A2

Standard tax code determination is made more and more intelligent through
• Extra parameters
• Use of specific tax code determination software such as bolt ons, also for EU.
A typical SAP example:
CoD CoA MTC CTC + e.g. INCO Term Tax code
E.g. BE BE 1 1 EXW A1
E.g. BE BE 1 1 FCA A0
E.g. BE AT 1 1 DAP A2
Typical pitfalls
• Limited determination
• Only core business  manual invoicing goes wrong
• Transport conditions are not taken into account
• Specifics are set up but the users are not aware of it, do not understand what has been
set up
• Lack of documentation
• Lack of training
• Users are not sufficiently informed about the possibilities
• Knowing what the system does or does not do, can prevent issues.
Sales invoices – electronic invoicing
• The use of an electronic signature shall be ‒ Legibility of the invoice has been added
subject to the acceptance of the recipient ‒ From issue until the end of storage
‒ Consent is still required. period
• To avoid that people receive electronic • Definitions
invoices which they are not able to ‒ Authenticity of origin = Assurance of the
treat due to IT technical restrictions identity of the supplier or issuer
• The need to guarantee authenticity of of the invoice
the origin and integrity of the contents ‒ Integrity of contents = Contents has not
remains mandatory been altered
‒ Now applies to both paper and
electronic invoices

Sales invoices – electronic invoicing
Each taxable person shall determine the way to ensure the authenticity
and integrity
• By business controls
• Which create a reliable audit trail between an invoice and a supply of goods and services
− Supply chain documents such as PO, delivery notes, payment
− Three-way matching principle
• Technological means can still be used.
• EDI
• Qualified electronic signature created by means of a SSCD
• By 31 December 2016 an assessment report will be made.
Sales invoices – storage
Invoices need to be stored for a legal • Practicalities

period – depends on the EU Member State • Do we have to print copies of
VAT legislation requires that invoices issued?
• Authenticity and integrity can be • In principle yes, but quite a lot of
guaranteed during the entire storage Member States allow that copies are
period archived electronically
• Electronic invoices can be stored within • Check specific rules
EU (online access required). Paper often • Watch out with master data
needs to be kept locally. changes
• In principle to be archived in format as • Technical limitations
issued

Purchase
invoices
13
Purchase invoices
How to deal with purchase invoices in an efficient and VAT compliant manner?
Things to consider:
• Each invoice you receive needs to get posted and a tax code needs to be assigned
 tax code determination
Technology Organisation
• Each invoice you receive needs to be entered in your accounting
 ideally in an automated way. E.g. via e-invoicing
But also have a solution in place to deal with paper invoices efficiently.
• Self-billing avoids that you have to enter the invoice in your accounting
 can be done in an automated way.

Purchase invoices - tax code determination
An example: Invoice
Other e- Scanned Invoice
Structured
invoice Invoice Postings
Data
OCR ERP ERP FI
Assign tax Calculate

codes tax
amount
Re-trigger
Tax Function the tax Auto-Tax
Module function
module
With OCR – Optical Character

Recognition – key tax information
will be determined on the invoice Determination ERP Tax
(e.g. Vendor VAT ID) tables Codes Profiles

Purchase invoices - tax code determination
1. PO data Tax Function module

(e.g. Ship To
Country)
Apply
Acquire Look-up Tax Assign Tax
Business
Input Data Codes Codes
Rules Invoice
2. Master data
(e.g. Material Tax Items with
Indicator) Data elements Interpreting Look-up tax Tax code Tax Code
required for tax data (e.g. how codes from assigned to
determination to handle ERP condition each item line
3. Invoice (i.e. input exceptions, tables of PO and non-
Data parameters of missing PO related
(e.g. Vendor VAT ERP condition data,…) invoices
number) table)

Purchase invoices – e-invoicing
The VAT rules that apply to e-invoices for Purchase invoices are
the same as for Sales invoices (see above).
Some key considerations:
• PDF invoices received via e-mail can be opened in an automated
way (e.g. e-mail connector) and processed by means of OCR.
• A portal (PO flip over) makes invoices easier to post/process in your
ERP system.

Purchase invoices – storage
• In order to keep only the scanned images, specific requirements need to be met, which
are country dependent.
‒ E.g. France does not allow digital archiving of paper invoices received
‒ E.g. Belgium allows scanning under specific requirements
• A new circular letter is to be expected for Belgium
• Attention for 8th Directive refund claims or expense invoices
• Place where invoices are sent to for processing. Is it allowed to send invoices abroad?

Purchase invoices – self-billing
Invoices may be drawn up by the customer, where there is

• A prior agreement between the two parties AND
• Prior means before first self bill is issued
• provided that a procedure exists for the acceptance of each invoice by the supplier.
• Both parties must be able to demonstrate the existence of the agreement separately
to the tax authorities
• Acceptance can be done implicit or explicit:
• E.g. by paying
Year end discounts – Belgian specifics that customer can raise a self-bill
Other relevant
documents
20
Other relevant documents
Your company will receive other documents than invoices which will have a VAT
impact:
• Expense note
• Digital expense notes
• VAT refund claims
• Customs documents
• Import & Export declarations

Summary
Legislation is slowly
catching up with
1
innovation. Also
Should your company inspections will
wait to automate
invoice processes to
get e.g. more legal
certainty?
No, surely not.
A lot can be done
3 be done in a
different way.
Be prepared
for it.
A well
managed
2
already in a VAT
compliant way.
Reflection and
documentation is
key.
4 invoice
process
will
prevent
errors/risk

Questions
Questions
We are happy to
answer any question
you might have.
Tank you for
attending our break
out session.


Tax Technology
Architecture
The need for a
roadmap
15 December 2015
1
Contents
Tax Technology - Main challenges
Tax Transformation - Getting in control of your destiny
How to deal with the tax transformation - Need for a structured approach
Guiding principles for building a roadmap
Conclusion - Tax transformation journey

Tax Technology
Main challenges
3
Tax Department is a large consumer of data
Several types of tax relevant data
Financial
• Most statutory • Master file / Local file • Trial balances • GAAP adjustments
accounts • VAT ledger • e-Tax returns &
• Paper tax returns • Expense reports e-Audit
• Tax calculations • Forecasts • Share options
• Tax payments • Tax adjustments
Unstructured Structured
• Valuation reports • APAs* • Employee numbers • Business activities
• DTA* recognition • Master file / Local file and locations • Due dates
• Tax advice • UTPs* • Tax registrations • Work allocations
• R&D timesheets
Non-Financial
*DTA – Deferred tax asset
*APA – Advance pricing agreement
*UTP – Uncertain tax position
Complexity of Tax Technology Landscape
Fragmented origination & processing of tax
relevant data

Tax Manager role today
Mainly Operator and Steward
© 2015 Deloitte Belgium Current state 6

Key tax trends will further increase technology
challenges in the tax function
Driver General trend Tax impact
Cost reduction • Economic changes • Standardisation

created need for • Outsourcing partners
cost reduction • Automation of processes
Technology • (Tax related) • Combination of IT and tax expertise

processes are • Changing workforce skills
• U.S. requires stricter tax
automated processes.
Regulatory and • Changing • Ethics and accountability issues • Korea requires disclosure of
Tax Control Framework.
social change regulations, • Tax administration relationships
specifically in EU • Stakeholder focus • China requires access to
internal tax risk control
systems.
Transparency • Increased scrutiny of • Transparency about operational targets and • Australia assigned risk ratings
to large enterprises.
and risk fiscal behaviour degree of control
management • Rules about tax • Defined responsibilities and upheld through • India is having more audit-
processes supervision based controls.
• Tax risks in business’ internal processes • UK requires a Senior
• New legislation (national and international) Accounting Officer.
for management, supervisors and financial
• The Netherlands implemented
authorities (e.g., the AFM, the Netherlands Horizontal Monitoring.
Authority for the Financial Markets)
• Germany requires standard
audit file for tax e-audit.
© 2015 For information, contact Deloitte Touche Tohmatsu Limited 7

Tax Transformation
Getting in control of
your destiny
8
Tax department objective
Transform to become more efficient in Operator
role and enable Strategist and Ambassador role
Current state Target future state

How to deal with the
tax transformation?
Need for a
structured approach
10
Structured approach needed
Framework: Key components of tax
transformation
Global direct tax
Global indirect tax
Accounting for tax (provision) People
and
organization
Process
Cash tax and payment management
and policy

Technology
and systems
Data and
information
Enablers
Value drivers

Technology and data
Financial systems not tax sensitized
Financial systems (ERP, EPM, …)

often not tax sensitized
2 options
Option 1: Tax-enabled financial systems Option 2: Remediation in Excel

• Long term • Short term
• Significant investment • Can be done with own resources
• Outside of span of control of Tax • Under control of Tax
• Up to a point • Flexibility
Most common approach, but…

Role of Excel Today
Making the headline
• 90% spreadsheets contain errors

• Spreadsheets used in business decisions can be costly
• One error can destroy reputation

Common Tax/Finance issue
End User Computing Application (EUCA)
• Excel workbooks are complex and manually intensive to create,
maintain, use, and are highly prone to internal design errors that may
result in flawed data
• Multiple versions of Excel documents impact decision making
• Unautorised access to Spreadsheet can be altered
• Input errors: Inaccurate cut-paste, inadvertent changes in cells,
incorrect links, import of incorrect data or import with wrong
parameters
• Logic errors: Due to incorrect formulas, and incorrect input data
• Usage error: Incorrect use of functions, ranges and references
• Inconsistent processes across tax departments/locations result in data
integrity issues
• Focus more on EUCAs by internal and external auditors
• Accurate of data can be compromised in Excel due to formula errors,
manually entered data and version control issues
Fixing Excel Spreadsheet for Tax
Improve, integrate, manage
Improving individual spreadsheets
1 The highest risk spreadsheets could be improved. This might

include making them simpler to operate, making the formulae
and flow of information more transparent to the reviewer, and
enhancing the controls present in them. Training would also
ensure best practice designs are used in the future
Integration within wider process
2 Improving how the spreadsheet interacts with other processes

helps validate its role, and gives greater confidence on the
robustness of the wider process. For example: automating what
information should and can come in; designing and automating
key reports
Managing large numbers of spreadsheets
3 Large numbers of spreadsheets leads to requirements such as

version control, knowing when and what changes are made
and a need to identify and visualise links between workbooks.
Off-the-shelf or bespoke control environments help manage this

Structuring the Data Flow
Tax Management and Tax Process Systems
Outsource provider
teams
• Local offices
• Compliance centres
• Centres of excellence
• Service centres
• A mix of resources
• Onshore
• Nearshore
• Farshore

Tax Management System
Example of Tax Workflow Tool - OWM
Dashboard DataFlow /
FileRoom WorkFlow Reporting Calendar Data Management
• Web-based document • Task and due • Tax portal or • Manage Tax • Standardize
management & date management desktop, including Deadlines collection of
storage visibility into KPI’s supplemental tax
• Auto notifications • Publish and track
• Document indexing to Tax Dept data
• Proactively external and
for quick search members of internal due dates • Consolidate data
monitor status of
• Control access to assigned tasks workflow, from data collects
• Available “Out-of and integrate with
documents and • Integrate process calendar, and data –the-box” global
manage versions control steps and collection tax workpapers or
content tax systems
sign-offs activities

Tax Process System
Example VAT compliance tool - SMART
Data Data Data Deliverables Review & Submission Management
Planning
Collection Validation Processing Preparation Sign off & Archiving Reporting
SMART: automated processing application
18
People and Organisation
Transformation impacts Tax Practitioners
Talent diversification in Tax

• Strong tax technical expertise and F.A.T. (Finance, Accounting and Tax) backgrounds
remain important, but more STEM (Science, Technology, Engineering & Math)
related skills will be required
• Drives change in how to attract, recruit, retain & grow people
• Impacts professional service providers and other sourcing channels
19
Tax transformation
Guiding principles
for building a
roadmap
20
Tax Transformation Roadmap
Guiding principles for step by step approach
• Fully engage in the tax

transformation journey
• Define your tax processes
• Put in place governance and run the
• Identify risks & opportunities to
tax transformation as a program with
improve (input to business case
intermediary milestones, various
for transformation)
workstreams, interdependencies,
• Fix the basics and implement quick wins • Define priorities stakeholder and people
• Get in control of Excel remediation • Elaborate vision and roadmap management, …

Case study – Sample Roadmap
Client’s objectives
• Automate the provision process

• Bring return preparation in-house
• Fully leverage and integrate the licensed ONESOURCE products
Opportunities overview
Opportunity Workstream Impact Priority
Source data Phase I: Expand blueprinting and define
requirements for automation, data collection, and High
accounting/finance
Phase II: Build, Test, and Deliver based on
Medium
Phase I
Phase I: Design Automation Solutions leveraging
High
Automation “Source Data” workstream Phase I
Phase II: Build, Test, Deliver based on Phase I Medium
Tax
Phase I: ONESOURCE Tax Provision Upgrade Medium
Provision
Return to Phase I: Return to Provision Design, Build, and
Medium
Provision Test
Phase I: Design Requirements for selected
Medium
Work Flow software
Manager Phase II: Build and Test based on design in
Low
Phase I
Draft timeline
Workstream May Jun Jul Oct Jan Apr Jul Oct Jan
2015 2015 2015 2015 2016 2016 2016 2016 2017
Source data
Automation
ONESOURCE
Tax Provision
ONESOURCE
Return to
Provision
ONESOURCE
Workflow
Manager
Strategic observations
• Tier legal entities based on materiality to ensure that Client is focusing

time on the units that make up a pre-defined % of pre-tax book income
• Eliminate duplication of effort

• Client performs tasks twice, once in Microsoft Excel and once in the
software to validate ONESOURCE calculations
• Review data sources for each phase of the tax life cycle and document
the data providers and requests within a workflow tool
• Build standardized packages that are connected to ONESOURCE

products
Conclusion
Tax transformation
journey
26
Tax Transformation journey
Wrap-up
- Data and Technology cause challenges for Tax
departments: landscape is complex and
1 - Significant focus on operational matters
- External trends further accentuate those
challenges
- Technology enabled Tax Transformation is Global direct tax

Global indirect tax
required to address those challenges Accounting for tax (provision) People

and
organization
- A long term vision and structured approach is Technology
Cash tax and payment management

and systems

2

needed given there are many areas to Process
and policy
address: data, different tax processes, Data and

information
Enablers
technology & systems, people & organization Value drivers

Tax Transformation journey
A roadmap to enable the shift in focus from
Operator/Steward to Strategist/Ambassador
- Approach and vision need to translate into a transformation roadmap
3
- Transformation should be run as a program
Current state Target future state

About Deloitte
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee, and its network of member firms, each of
which is a legally separate and independent entity. Please see www.deloitte.com/about for a detailed description of the legal structure of Deloitte Touche
Tohmatsu Limited and its member firms. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its
subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.
This communication contains general information only, and none of Deloitte Touche Tohmatsu Limited, its member firms, or their related entities (collectively,
the “Deloitte Network”) is, by means of this communication, rendering professional advice or services. No entity in the Deloitte network shall be responsible for
any loss whatsoever sustained by any person who relies on this communication.
Copyright © 2015 Deloitte Development LLC. All rights reserved.

Member of Deloitte Touche Tohmatsu Limited
29 Copyright © 2015 Deloitte Development LLC. All rights reserved.
Transform today
for the challenges
of tomorrow
Indirect Tax
Analytics:
Intelligent data
24 November 2015
Hilde Vandeperre– Director, Deloitte Belgium
Mo Giovanni Gijsels – Senior Manager, Deloitte Belgium
1
Customs &
Global Trade
Analytics
2
Setting the scene
• Is your company involved in import or export activities?
• Do you know the duty burden of your company?
• Do you know departure and destination countries?
• Do you know if preferential duty rates are applied?
• Do you know your brokers?

Setting the scene
ERP environment only covers basic functionalities
What
Specific flows require a specific treatment companies
think they are
doing, is quite
often different
3rd Parties are doing the actual filing
from what they
are “doing”
The end result is often not coming back

Setting the scene
How many Proof of Are we over-
brokers do export? EXW or DDP? or under-
we have? reporting
duties?
New CN
What is the UCC
codes
impact?
Do we use preference?
Are we impacted
VAT
by export
deferral? …
controls?
CGT Analytics: tools and sources
4
3
Other tools and support
2
1 GTM Dashboard
Declaration data
Own ERP Data

Working with ERP data
• Always available • Complex for cross
system comparison
• Rather easy to obtain
• Does not say anything
• Good starting point: about the actual data
• Important trade
lanes
• Important materials
• Master data quality
• …
• Trends & Indications
• Client specific
Working with declaration data
• Actual declared data • Not possible in all
countries
• Provided by
authorities or brokers • Broker data: did we
cover them all?
• All customs elements
• Differences in format
• Cross checks with remain
VAT
• Full overview
• Standard
Working with own GTM data
• Actual declared data • Not always possible for
all processes &
• Own data countries
• Possible for multiple • Data infrastructure
countries requirements
• Full overview:
• Reporting
• Analyzing
• Trends
• Client specific
• Link with logistic
systems
Supporting tools
• Address specific need • Should be a second
step, not a starting
• Landed cost tool point
• Classification tool • No full integration with
• FTA company systems
• Low cost of • Patchwork of solutions
implementation • Limitations
• Ease of use
• Multiple users (e.g.
intranet)
VAT Analytics
11
Setting the scene
• Are your ‘VAT’ and ‘intrastat’ master data under control?
• Is the VAT treatment of an invoice following the actual flow of goods?
• Do you know who processes AP invoices the most correctly?
• Do you know whether AP invoices are processed timely?
• Do you know which invoices are the most important ones to check in terms of
amounts?
Setting the scene
Consistent
Impact of VAT
Incoterms? Actual flows treatments Services for
applied? invoices issued
to established
entities?
How many ERP Missing CN
systems do you codes
have
How many different VAT numbers?
VAT input Correct use of

deduction VAT numbers? …
VAT Analytics: tools and sources
4
3
Other tools and support
2 (e.g. VAT rate tables)
1 Own ERP Data: financial data
Own ERP Data: master data
Own ERP Data: logistical data

Working with logistical ERP data
• Always available • Possible interface if
logistical & financial
• Rather easy to obtain data are in different
• Good starting point: ERP systems
• PO and SO
• Delivery information
• …
• Challenges:
• Link to financial
data (e.g. various
materials, only 1
tax code)
Working with ERP master data
• Check on availability • Possibility to look at
missing master data
• Rather easy to obtain for relevant
• Good starting point: transactions only.
• Customer data • Get insights in
• Supplier data amounts.
• Material master
data
• …
• Check between
transactional master
data used and static
master data (e.g. VAT
number)
Working with ERP financial data
• Always available • High volume of dataµ
• Rather easy to obtain • Gain new insights
• Good starting point:
• Ledgers
• Accounting
• Tax codes
• …
• Line level detail
comparisons
• Comparisons:
• Per entity
• Per country
• …
Supporting tools
• Updated VAT rate • Importance of working
tables with updated
information
• Updated list of
commodity codes
• List of commodity
codes with specific
VAT treatments
• Import/Export data
• Local reverse charge
rules
• VAT compliance
related information
Questions
Questions
We are happy to
answer any question
you might have.
Thank you for
attending our break
out session.


Transform today for
the challenges of
tomorrow
Corporate taxes and
statutory accounts:
A single challenge
15 December 2015
Gino Van Hoornyck - Deloitte Belgium
Chris Kinders – Deloitte Netherlands
1
Contents
• Tax compliance delivery models
• Integrating statutory accounting and corporate tax reporting
• Technology
• How to get started

Tax compliance delivery models
Our global operating model is used to deliver services via three overall methods that recognize the degree of clients’ desired
centralization. We are seeing a shift in the marketplace toward coordinated and centralized delivery, which provides increased
visibility, process efficiencies, and risk mitigation.
Decentralized Coordinated Centralized
01/ 02/ 03/

Delivered and Delivered and
Delivered locally,
managed locally managed centrally,
managed centrally
supported locally
local-to-local delivery central-to-central delivery
• Full visibility • Full visibility

• Limited visibility • Mitigated risk • Further process efficiencies, data
• Lacks consistency and efficiency • Improved standardization and quality and risk mitigation
process efficiencies • Data analytics, tax modeling, etc.
Key decision drivers
Centralised Decentralised
SSC strategy
Organisation Role of retained finance
Tax and local GAAP knowledge at SSC
Structured vs unstructured process

Process Granularity of data and tax sensitization
/ Data Quality and location/ownership
Number of ERP / legacy system(s)

Technology Harmonization of ERP systems
Consolidation, integration and level of localisation
Fully fletched vs stripped

Business Stability of the business model
Local Complexity of local requirements / regulation

Language requirements
requirements
Integrating statutory
accounting and
corporate tax reporting
5
Statutory accounting and corporate tax reporting
Why integrate these processes?
• Harmonized E2E compliance process
• Integrated workflow management
Process Efficiency
• Simplify data management
• Reduce lead-time & efforts
• Greater visibility of filing status

• Transparency of filings through GAAP to tax rec’s
Risk Management
• Increased data consistency
• Increased quality of filings
6
Components of a standard E2E compliance process
• Definition of a standard 8-Steps global process for the management of

compliance
Process Data Deliverable Review & Sign Submit & Mgmt.

Data Collection Data Validation
Planning Processing Drafting off Archive Reporting
• Review of key milestones to identify process owners: integration into a

responsibility matrix
Defining the components of the tax function
Key actors to consider
Consulted Responsible
Informed Informed
RFO SSCs
Accountable Global CoE Responsible

Consulted Tax (Hubs) Consulted
Informed Informed
Defining main activities
Process Data Data Data Deliverable Review & Submit & Management
Planning Collection Validation Processing Drafting Sign off Archive Reporting
• Confirm availabilities • Provide source data • Provide additional data • Clarify/confirm ad hoc • Review and approve • Submit CIT return and
• Calendar of internal due • Prior year package • Business information matters statutory financial
dates update statements (where
Company • Share business info client is required to do
update so)
• Assess impact of non- • Discuss impact of non- • Prepare draft CIT • Finalize CIT return • Submit CIT return and
routine business events routine business events returns • Prepare Deloitte statutory financial
on stat & tax on tax compliance • Review book-to-tax standard Tax Reporting • Review and discuss statements (where
Deloitte compliance reporting reporting reconciliations (RTA) Memo client comments Deloitte is able to do
Local so)
• Assess impact of non- • Perform data validation • Discuss impact of non- • Prepare local GAAP TB • Finalize statutory • Review and discuss • Post return and • Data analytics
routine business events • Monitor data gathering routine business events (GAAP conversion) financial statements client comments deliverables to DTi • Regional / global
on stat & tax process on tax compliance • Prep book-to-tax • Review Tax Reporting reporting on tax issues
Global Tax compliance reporting • Inform client of reporting reconciliations (RTA) Memo for consistency
• Review due dates and additional information • Monitor timely requests • Prepare statutory checks
Center agree calendar needs and receipt of data from financial statements
• Governance and the regional vantage
process point
DCT – Local CIT tools E-filing software
Supporting
Technology
Deloitte Tax Insight
Mapping Roles and Responsibilities
A new resourcing model
Historic resourcing Future resourcing
model model
Process
Technology Knowledge
New skillset:
People are knowledge workers • Accounting and Finance • Technology
• Tax technical • Communication
• Business • Mobility
Technology
13
Technology - Deloitte Tax Insight
DTi, our web-based collaboration solution that supports efficiency, transparency and
enhanced performance. This secure web-based “digital dashboard” provides access to our
collaboration space, allowing us to share information with our clients 24 hours a day.
Key Benefits
• Achieve greater visibility
• One source of truth
• Improved control
Technology - Deloitte Conversion Tool (DCT)
Replacing previous Excel based Conversion files, The Deloitte Conversion Tool (DCT) is an
application developed by Deloitte to support GAAP to GAAP reconciliation and provide
companies with multiple reporting functionalities.
Key Benefits
• Reduce risk
• Achieve greater visibility
• Save time
• Ensure standardization
• Improve consistency
• Minimizes on going
report maintenance
How to get started – Q&A
?

Transform today for
the challenges of
tomorrow
Closing
15 December 2015
Andre Claes – Partner, Deloitte Belgium
Mark Kennedy – Partner, Deloitte UK
Patrick Joucken – Partner, Deloitte Belgium
1
Management of tax
The environment
3
Management of tax
The business response
Tax
Tax Data Governance
and and Risk
Systems Management
Tax Operating
Resourcing
Models 4
Tax Resourcing Models
Components/building blocks of the tax function
More likely in SSC More likely in Tax
Operational Strategic
Accounting and Operational risk

Compliance Tax strategy
reporting management
• Financial close for • Master Data • Controls operation • Tax objectives

Tax Management and internal audit
• Tax strategy
• Reconciliations • Tax return data • Technology tools
• Technology strategy
• Indirect Tax • Local Stat Accounts • Compliance manual
• Tax risk framework
• Accounting analyses • Return preparations • Tax risk register
• Process
for Tax
• Compliance • Tax audit support determination
• Management Outsourcing
• Tax litigation
reporting on Tax
• TP documentation
preparation
Automation and technology integration

Organisation and resources 5
Facing big questions from stakeholders
“What and
“What is the where are our
total cost of my biggest tax
tax function?” risks?”
“How do we “What would a

know if are 5bp increase in
compliant across our ETR mean
all our taxes, for us?”
everywhere?”
6
The Four Faces of the Tax Director
7
Tax Manager Objectives
Moving from Operator to Strategist – Current state
Ambassador Strategist
3% Stakeholder management 1% Planning
9%
Reporting
10% 40%
Review Information
Gathering
15%
Rework
22%
Tax
Adjustments
8
Rating scale:
Questions 1 – I have not started yet
Where do you stand? 5 – We are ready!
1. Do you have a tax technology roadmap?
9
Rating scale:
2. Are all tax processes properly documented for all countries?
10
Rating scale:
3. Are tax roles and responsibilities well defined between finance and the tax
department?
11
Rating scale:
4. Do you use SSC for producing tax compliance data?
12
Rating scale:
5. Are the VAT ledgers produced by a system and require little or no adjustments?
13
Rating scale:
6. Are statutory accounts produced decentrally and reviewed centrally by tax?
14
Rating scale:
7. Have you started preparing for CbC reporting obligations?
15
Rating scale:
8. Are you prepared for tax eAudits in Europe?
16
Tax Manager Objectives
Moving from Operator to Strategist – Future state
10%
Information
Gathering
25% 10%
Planning Tax
Adjustments
10%
Rework
10%
25% Review
Stakeholders
Management
10%
Reporting
17
“We always overestimate the change that will occur in the
next 2 years and underestimate the change that will occur in
the next 10. Don’t let yourself be lulled into inaction”
- Bill Gates
“God grant me the serenity to accept the things I cannot

change, the courage to change the things I can and the
wisdom to know the difference”
- Ignatius Loyola
18

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Transform today for

Transformation – what and how?

"Everything that can be

Thomas Watson 1943

Thomas Watson 1943

“When we set the upper limit of PC-DOS at 640 KB,

TECHNOLOGY proliferation … fuels

Transformation of REVENUE New STAKEHOLDERS … have emerged

• Control powers of tax authorities

OECD’s Base Erosion & Profit Shifting study

• More taxes and more reporting in more jurisdictions

News & updates Dbriefs webcasts

Tax Policy Framework

Tax Risk Management Culture

Yes, for all four areas 47%

Source: Deloitte Global Market Research, 2014

“How is success Tax Policy Framework “How are key

“What governance “Who owns each

is there over tax?” tax?”

• Tax Authorities – e.g. UK,

• International bodies – e.g. OECD,

• Investors – e.g. Local Authority

• Analysts – e.g. Schroders, Citi

• Indices – e.g. Dow Jones

• NGOs – e.g. Tax Justice Network,

“How do we report to Tax Policy Framework “What are our key

“When is Internal “Who are our ‘lines

Audit testing tax?” of defence’?”

Source: Deloitte Global Market Research, 2012 and 2014

Source: Deloitte Global Market Research, 2014

“What is the right “Can we leverage

in/out/co-source our Shared Service

© 2015 Deloitte Belgium 26

Cash tax and payment management Process

Close, provision, and process

Risk and tax controversy

Tax business planning

Interconnections – Change management – Communication

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2. Issues & Challenges

4. Implementation & Monitoring – SAP example

How do you get there – some key considerations?

• Financial reporting to Tax

Adjustments Price lists:

Adjusting books before year end close is a critical component of ensuring

A combination of SAP modules can be used to effectively implement and monitor

BPC: Budgeting Module - Determine transfer price by product

SD: Pricing Module – Configure transfer price by product

FICO (COPA): Controlling Module – Analyse PLI variances and

1 2 • These 4 steps will help you to

Per • PLI computation

2 • Standard costs and list prices

• Intercompany invoices can be

• Analyze Actual PLI (OM, NCP) by segmented

Per • Determine Transfer Price adjustment

• Budgeting module does not need to be

Per • TP on services (cost re-charges) can be

Master File 3. Technology

Legal structure, business Systems

Risk, controls and governance

© 2015. For information, contact Deloitte Touche Tohmatsu Limited. 22

Introduction of Union Customs Code / Transformation – why?

Transform today for the challenges of tomorrow – how?