Headline Verdana Bold

Managing tax
Balancing current challenge with future promise
The EYE, Amsterdam, 30 November - 1 December 2016
 Realising the
benefits of
integrated
process
delivery

David Wright, Deloitte UK

Laurent Nowicki, Deloitte Belgium
 Contents

Introduction: why integrate these processes? 4

Components of the tax function 5

Integrated statutory accounting and corporate income tax process 6

Defining roles and responsibilities 12

Supporting technology 15

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 Statutory accounting and corporate tax reporting
Why integrate these processes?

• Harmonised end to end compliance process

• Integrated workflow management

Process efficiency • Simplify data management

• Reduce lead-time and efforts

• Greater visibility of filing status

Risk management
• Transparency of filings through generally accepted accounting principles (GAAP) to tax
reconciliations

• Increased data consistency

• Increased quality of filings

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 Components of the tax function
Key stakeholders

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 Defining the components of the tax function

Operational Strategic

More likely in shared service centre (SSC) More likely in tax

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 statutory • Compliance manual • Tax risk framework
accounts
• Accounting analyses • Tax risk register • Process
for tax • Return preparations • Tax audit support determination
• Management • Compliance • Tax litigation
reporting on tax outsourcing
• Transfer pricing (TP)
documentation
preparation

Automation and technology integration

Organisation and resources

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 Integrated statutory accounting and
corporate income tax process

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 What is key to build an integrated statutory accounting and corporate tax process?

People Process Technology

International and Standard and scalable ERP and
multidisciplinary team processes middlewares

Strong accounting Standardised deliverables Specific production

and tax expertise tools
Central management
Project management and governance Global entity
specialists management tool

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 Statutory accounting and corporate tax reporting
Components of a standard end to end compliance process

• Standardisation of processes

• Fully documented: audit trail

• Flexible and scalable

• Standardisation of deliverables

• Support local requirements

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 An integrated, state of the art, statutory accounting and corporate tax process

Process Data Data Data Deliverable Review and Submit and Management
planning collection validation processing drafting sign off archive reporting

• Management of external audit and

SSC / R COE

• Management of
deadlines • Provide non-financial data statutory process (group and statutory) • Reporting on
• Review and
• Business information update statutory process
approve • Submit Statutory
• Governance • Clarify/confirm ad hoc matters and continuous
Financial
process
Statements (SFS)
• Review non- improvement
and CIT return (CPI) initiatives
routine business Integrate country by country (CBC) • Preparation of Mgmt. to Local GAAP and Review CBC and
events additional data points in PBCs e.g., tax adjustments TP ratios
tax cash and income by party Consolidate CBC/
• Preparation and (IC/external) • Preparation of local GAAP TB, Financial TP reports
Deloitte

integration of • Provide support

• Automate data extraction for Statements and equity reconciliation
material to reviewers
Enterprise Resource Planning (ERP)
provided by reports (Trial Balances (TBs), General • Prepare Local Tax Provision (LTP), • Store on GMT
client (PBC): Ledger, Fixed Assets, Re-valuation Corporate Income Tax Return (CITR)
Stat Acc., CIT, reports…) and Return to Provision (RTP)
Audit • Access financial information through
Balance Sheet reconciliation • Audit procedures
• Review and
Auditor

Q4 working (middleware) • Provide proposed audit adjustments

session meeting approve
Technology

ERP/middleware Deloitte Conversion Tool (DCT) SFS and CIT specific tools E-filing software
Supporting

Global management tool

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 Key areas of improvement

Standardisation of processes Efficient end-to-end statutory Leverage technology: Global management system
and deliverables accounting and corporate tax
process:

• Automate core data extraction • Deploy a global data

• Combined stat and CIT process management platform to
• Standard deliverables
• Leverage middleware systems
monitor filings and access
data
• Reconciliation GAAP to Stat to • Integrates all stakeholders
Tax (tax bridge)

Opportunities

• Harmonise deliverables and
reconciliations across all
jurisdictions/Legal Entities
(LEs)
• Reduce lead-time
• Include Tax and TP teams
(Process design and RR)
• Harmonise production tools • Leverage available multi-
years statutory accounting
and CIT data to perform
• Connect output to Deloitte
analytics
CbC Digital Exchange (CDX)
(TP)

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 Defining roles and responsibilities

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 Defining roles and responsibilities
Key stakeholders

ON-SHORE/VIRTUAL FAR-SHORE/FINANCE
− Oversight and control AND ACCOUNTING (F&A)
− Risk and opportunity − Language independent
− Rule based processing
Tax SSC

Local CoE
Finance
ON-SHORE NEAR-SHORE CENTRE OF
− Not involved EXCELLENCE (CoE)
− Involved in high complexity − Language dependent
business/jurisdictions − Tax technical
− Clustered/regional

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 Defining roles and responsibilities
Map standard process to your own organisation

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 Supporting technology

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 Integrated statutory accounting and corporate income tax
Technology landscape

US 10K
2 Consolidation System Conso
SFS
Single recipient for all statutory data and source of
Oracle Hyperion Financial
Management (HFM)
cross-border standardised reporting

IFRS /
USGAAP

Mgmt. to Statutory
1 Core ERP 4 6 Mgmt. Reporting
ledgers
All countries CBC
Oracle/SAP… BS rec’n Middleware Ad hoc reporting layer
Middleware

Local
GAAP 5 SFS and CIT returns
SFS CITR
Local Tools
Complex
Jurisdictions*
3 Tax Provision

Middleware

Global management tool

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 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 standardisation

• Improve consistency

• Minimise ongoing report maintenance

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 Faculty

David Wright, Deloitte UK Laurent Nowicki, Deloitte Belgium

Partner Partner

davidcwright@deloitte.co.uk lnowicki@deloitte.com

+44 20 7303 4641 + 32 2 800 25 11

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