Tax Function Transformation

Optimising data and technology 

By improving data quality and automating processes, technology can help to transform your tax function into an efficient enabler of your business goals. Technology vendors have responded to these changing tax requirements by developing solutions in areas such as data and process automation.

An effective modern tax function has a defined technology strategy, closely aligned with related parts of the business. We can help your tax function integrate technology into your overall strategy. We can also work together to create a clear roadmap for delivery, either by implementing new technology or optimising existing technology. We’ll collaborate to identify, map and transform your tax processes, harnessing the latest technology developments to automate where it adds value.

We can help by: 

• Working together to develop a tax technology roadmap. This is based on what tools are currently used within the company. We can then help you to refine your plans in line with your strategic goals.

• Automating manual processes, reconciliation reporting, and web-enabled data collection. Our solutions draw on automated data workflows that integrate with an overall tax data-management framework.

• Developing business intelligence tools to assist with tax planning, scenario forecasting and predictive analytics.

• Upskilling your teams in automation trends and helping them to identify practical use-cases. This will help you apply small automation to the way you work, as well as supporting the tech enablement of your tax function over time.

• Deploying or running these areas as a managed service to enable you to automate processes more rapidly.

• Establish a sustainable and agile governance model that formalises stakeholder roles and responsibilities and also updates internal controls, addresses additional change management challenges, and monitors business and legislative changes.

Explore more:

• How Tax is leveraging AI — Including machine learning — In 2019
  We are experiencing rapid technological change that is affecting all areas of life and work – and its impact extends to enabling areas such as Finance and Tax with increasing use of emerging technologies such as AI and machine learning, blockchain, and 3D printing. Access the report (PDF 1mb)
• The modern Tax Function - Integrating and scaling automation    
  In this digital age when you can easily search for information on devices that quickly return vivid displays on screen, human interaction—the simple process of meeting and sharing with others—still has tremendous value. Why should we share across Tax functions? It is important because our Tax challenges are becoming too complex to solve in isolation. We can learn from the mistakes of others and be encouraged by their successes. 

Designing and delivering tax strategy and target operating models 

It’s more important than ever to have confidence in the tax numbers you report – not least because of changes to tax laws, tax governance regulations, new accounting standards, and increased scrutiny of how much tax organisations are paying. 

Your tax function’s ability to deliver depends on your ability to keep pace with today’s ever-evolving regulatory changes – while also supporting the overall business strategy. This is clearly challenging. Many corporate tax functions are struggling with operational effectiveness, or may have felt the impact of recent mergers or acquisitions. Senior executives want them to step up to the mark.

A key challenge in the current environment is how best to respond to the pace of regulatory change. Some companies are adopting a reactive approach. Others are being more strategic, considering transparency – in terms of who they need to address and for what purpose. Forward-thinking tax departments are carrying out thorough current-state assessments that provide a roadmap to improve efficiency while delivering strategic goals. These assessments consider the current operational state, culture, and realistic appetite for change.

Tax functions must be able to show that tax risk is mitigated to an acceptable level. This often requires a formalised tax control framework and testing programme.

We can provide flexible but thorough solutions to help improve your tax function’s performance, while reducing your risk. Our holistic, practical and scalable approach in helping you assess your tax function will help you work more efficiently and effectively. Our review includes key areas such as people, process, technology, and data.

We can help by: 

• Providing an assessment of your tax function to help you develop a ‘target future state.’ We can also help you to assess and support the business case for transformation.

• Aligning the tax organisational design with continuous strategic tax initiatives.

• Developing opportunities to improve processes in key tax functional areas, supported by a nimble tax organisational design.

• Assessing the maturity level of your current and desired tax control framework.

• Supporting you as you implement an end-to-end tax risk management approach.

Explore more:

• Design considerations for your tax function  
  What factors should be considered when leaders select the ideal tax operating model for their organization? In the Tax Function of the Future webcast, Tax  organizational Design - Options to Manage Global Tax Team in a Post-reform World, we covered the common tax organizational models we see employed and evolving catalysts for change. Read the full blog

• Paying Taxes 2020: In-depth analysis on tax systems in 190 economies
  Explore the new edition of Paying Taxes, a unique report by PwC and the World Bank Group, in which we explore how the digital revolution is transforming almost every aspect of paying taxes.
  Access the report

• Tax Management Maturity Model (T3M)
  Perform a current state review of tax management across your business using our Tax Management Maturity Model (T3M).

• Corporate Tax Governance - A strategic and sustainable approach to tax 
  Global businesses are used to operating in a world of constant flux, complexity and uncertainty, but there are changes on the horizon.  Now is the time for a corporation, together with its stakeholders, to place tax in the context of its purpose, values and sustainable business strategy. Find out more in our publication on corporate tax governance and sustainable tax.

Implementing or upgrading an ERP system

The ERP system is the backbone of your organisation’s reporting. For many organisations, upgrading ERP systems is often part of a strategy to become more agile, respond to market challenges, and drive profitability. 

As part of these ERP transformations, organisations are starting to consider tax earlier in the process, during the scoping and budgeting phases. Considering tax earlier can lead to significant benefits for the tax function and the overall end-to-end finance solution. It’s an opportunity to look at ways to improve the quality of the data that the systems provide to the tax function – and, in turn, this can help to improve finance processes and efficiencies providing greater data insights. 

We work alongside our clients to take the complexity away from ERP implementations. It’s often the case that these projects call for significant support throughout the entire project lifecycle – including from strategic design through to execution, to address financial, operational, technical and compliance challenges. We can guide you and help you consider how to:

• Leverage ERP systems for financial data. Tax departments are consumers of financial data. So, when tax is considered in the implementation process, you can use the ERP to derive a significant amount of the data you need to support the production of tax deliverables.

• Spend less time collecting, manipulating and managing data, and more time on strategy. Typical tax departments spend significant time focussed on data collection, so this helps free up time to add value elsewhere.

• Realise the benefits of tax integration. Material weaknesses and significant tax deficiencies are on the rise – so an ERP implementation is a huge opportunity to ‘get it right’.

We can help by: 

• Tax sensitizing the general ledger and legal entity system design (GAAP/STAT/Tax).

• Integrating third-party technology for tax provision and compliance.

• Implementing third-party indirect software.

• Performing transfer pricing alignment by jurisdiction to support compliance needs (e.g. country-by-country reporting).

• Operationalising transfer pricing, monitoring and reporting.

• Analysing R&D credits and costs of ERP implementation, so you can maximise current deductibility of costs.

• Conducting impact assessments on tax accounting methodology as you convert from legacy systems.

• Considering impacts of tax reform to the business and ERP global design and supply chain.

• Integrating Tax design with Treasury.

• Integrating Tax design with customs and trade.

• Collaborate with finance functions during a transformation initiative to make sure you meet tax requirements.

• Providing insight when going through a transaction to help integrate multiple ERP systems.

   

Links: Tax Function of the Future: Tax as a critical component in every Finance transformation

Tax and Finance face similar challenges requiring a fundamental re-evaluation of operations and processes. Both need to better support their internal and external stakeholders—the business, regulators, and investors—often without access to increased resources. What is critical for success? Access the report (PDF 965kb)

Implementing tax provision software

Tax accounting or reporting requires a substantial amount of time and effort. Globally, tax laws and regulations are evolving and the need for transparency, completeness and timeliness continues to increase. 

We help address complex global tax accounting needs. Our support draws on our specialist expertise in redesigning tax accounting processes, embedding controls, and adopting tax provision technologies. This includes working with multinational organisations of all sizes to design efficient and effective tax accounting processes. We also help them to implement technology solutions, including third-party tax provision and compliance software, to address global tax accounting complexities. 

We understand that implementing new technology can be a daunting task. There are multiple barriers to plan for. We’ll share our global experience and expertise to help clear those hurdles. We can also help you think through how to design and configure the solution, implement tools, and guide you through the go-live and testing phases.

We can help by:

• Assessing and providing an objective evaluation of third-party tax provision, compliance or other tax technology tools, based on the requirements and needs of your tax function.

• Helping you design, set up, configure and test third-party technology.

• Providing training on the enhanced tax accounting process and use/functionality of third-party technology. 

• Redesigning and automating the end-to-end tax close process.

• Assessing and designing controls.

• Remediating material weaknesses and significant deficiencies.

• Developing provision analytics (ETR, materiality scoping, etc) through use of small automation.

Operationalising Tax in Deals

We work with you to address tax considerations and optimise operations throughout the deal lifecycle – from pre-signing to post-close. We can help identify potential tax operational synergies, manage change and accelerate ‘business as usual’ integration. We help you to tackle the challenging business issues in the tax function when undertaking mergers, acquisitions, divestments and strategic alliances.

We can help by: 

• Getting you ready for ‘Day 1,’  including transaction implementation and legal entity operationalization.

• Post-deal integration of tax function's people, processes and technology.

• Preparing your company’s tax function to meet the requirements of a public filer if you’re contemplating an IPO.

• Supporting you with legal entity strategy and simplification to align the structure with the business while reducing legal entity maintenance costs.

• Preparing the tax department for ‘separation readiness’ on divestment.

• Setting up a project management office (PMO) to integrate or separate tax functions.

• Using the transaction as a catalyst to improve tax operational performance, while realising deal synergies through streamlining and automation.