TaxLab. Organising the tax function. April 17, 2014 Robbert Hoyng

Transcription

1 TaxLab Organising the tax function April 17, 2014 Robbert Hoyng

2 Denying the future

3 Agenda Tax function model Tax transformation Approach Q&A

4 Tax function model

5 Roadmap

6 Poll Question #1 Wat zijn de belangrijkste uitdagingen van jouw tax functie? 1. Budget druk 2. Personeelsmanagement & resourcing 3. Korte closing periode 4. Bijhouden van nieuwe wet- en regelgeving 5. Data kwaliteit en beschikbaarheid 6. Andere

7 Poll Question #2 Wat kost de organisatie van de tax processen, per 100mio revenue? euro euro euro

8 Case study Global tax management challenges Europe Trend is to move to e-audits and deliver standard audit file (i.e. new German E-Filing requirements) US Sarbanes-Oxley regulations Schedule M3 reporting requirement Uncertain tax position disclosures Brazil Elimination of corporate tax return filings due to large amounts of data maintained by authorities India More audit-based controls Introduction of strict penalty provisions including prosecution Australia Businesses are assigned a risk rating by the Australian Tax Office. Derived from data analytics and risk profiling techniques China Authorities granted increased access to internal tax risk control systems

9 Case study Global tax management challenges

10 Poll Question #2 Welke activiteit kost het meeste tijd van de tax functie gedurende het jaar? 1. Algemeen management (tax function) 2. Tax planning 3. Business partnering 4. Jaarlijkse compliance & reporting 5. Transactionele compliance 6. Transfer pricing 7. Vragen en audits 8. Andere

11 European Tax Directors

12 What is necessary for a world-class Tax Function Strategic direction Strategy Governance Roles and Responsibilities Effectiveness Key tax and reporting activities Order 2 Cash Procure 2 Pay Group Tax Planning Finance Transaction Compliance Tax processes SSC Annual Compliance Inquiries & audits Business Efficiency Record 2 Report Business Reporting Transfer Pricing Other Stakeholder Management Transparency Supporting infrastructure Organisation People Data Systems Risk

13 Effectiveness Tax strategy in line with the business

14 Efficiency in control processes Many organizations operate in a siloed, linear environment, without leveraging the synergies and efficiencies across key areas Process improvement, enabled by proper technology allows for a reduction in unnecessary work Manual data input Manual data input Manual data input Manual data input Manual data input Forecast Provision Return R&D incentives VAT Forecast ETR Tax accruals & disclosures Tax return Benefit reports VAT return Cash flow mgt Continuous manual data retrieval and reconciliation Ad hoc manual data retrieval for planning and strategy

15 Efficiency (cont d) Record-to-report cycle Tax process Input Process Output Source data Data collection Calculation Consolidation Reports ERP Co-only Co-only IFRS Data IFRS tax Disclosures Local GAAP data Tax Data HFM, SAP BPC, and IBM Cognos. Tax Forecasting Manual Excel Local GAAP Tax Disclosures Manual data Webform CIT or VAT tax return

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17 Transparancy Stakeholder management

18 Transparancy (cont d) Stakeholder management

19 Tax transformation

20 Poll Question #3 Welke van de volgende gebieden hebben de grootste impact op transformatie binnen jouw tax functie? 1. Beschikbare resources / mensen / capaciteit 2. Ons technologie landschap 3. Waardering voor tax van ons management (CFO/CEO etc.) 4. Koppeling corporate strategie met de tax strategie 5. Andere

21 Tax transformation Alignment with business maturity The role (and potential need for improvement) of the Tax Function varies with the maturity level of the organisation. Growth rate Time Phase 1 - Introduction Phase 2 - Growth Phase 3 - Maturity Operational risk management Avoid failures, e.g. fraud Meet Business Control Framework requirements Tax planning Utilisation of tax facilities Avoid business disruption Meet Business Control Framework requirements Actively manage tax portfolio through planning Tax compliance / filing Compliance oriented Process oriented IT oriented Tax reporting Report ETR Manage ETR Plan ETR Risk No risk register Periodic risk register Continuous monitoring

22 Value Tax transformation (cont d) Alignment with business maturity 4 1 Standardisation of processes 2 3 Concentration of processes Automation of processes Driving Value through Analytics Time

23 Approach

24 Approach Enablers of the tax function Talent & People Talent enables the organization to pro-actively act on business developments and economic, tax and legal circumstances. People make sure that compliance and reporting obligations are met. Sufficient tax knowledge and awareness are key to create and control the tax environment. Information & Automation Information flows are the basis for acting and reacting to developments. Communication is essential. Automated solutions are an integrated part of business and finance processes. To ensure that tax is covered and tax obligations are met, tax should be part of the automated solution design. Policies & Procedures Tax can be part of the business policy and/or governance to achieve their goals. Also, decisions made will be in line with the business policies. With regard to efficiency, timeliness and correctness, processes should be defined clearly. Procedures can enable people to perform their duties and secure future cooperation. Tax Structure & Sourcing Tax payers have several layers and obligations with regard to tax. Therefore roles and responsibilities regarding tax should be clear, fit the operating model and department capabilities. Decisions with regard to outsourcing and co-sourcing enables to meet tax requirements efficiently.

25 Approach Example roadmap Standardization Topic Ambition 2020 E2E Manage Taxes Process T02 VAT Analytics T06 Tax Dashboard T04 Data analytics (improvement initiatives) T05 Design PIL T05 Implement PIL T01 TA Analytics T03 T&C Analytics T04 Data analytics T04 Data analytics Cycle time filing & reporting Accurate compliance & reporting Process excellence Sustainable monitoring and tax control Integration and standardization of enabling landscape and system architecture Maintain tax master data T07 TP Clear guidelines for TP policy implementation into master data Maintain tax policies & procedures Perform knowledge management Perform tax planning/strategy Perform tax risk management Aris T09 T12 T14 T18 T08 RACI GSA T13 T15 Tax Learning T10 RACI T11 Central Repository Esc T16 Scenario Planning T17 Tax Opt Study Tax Risk Control T19 Process P&P Monitoring Implement standardized processes Clearly defined roles & responsibilities and back-up structure Shared, standardized information, documentation, resources and policy & procedures Sufficient, shared and sustainable tax knowledge and awareness throughout the global organization Optimization of sustainable tax planning and global tax cash optimization Standardized tax risk management process facilitated by automation Monitor tax compliance T20 DDT Insight in global tax compliance status Manage tax provisions T21 UTP Standardized and optimized UTP recognition and determination Perform tax reporting T22 Tax Pack Automated (improved) tax reporting template for efficient consolidation and tax reporting positions Prepare returns (indirect) T23 T24 Automate AP VAT add on Automated tax determination Identification Pilot Phase Roll-out Value realization

26 Roll-out Pilot Implementation Design Approach Example roadmap (cont d) Tax processes Q1/2/3/4/2014 Q Q Prioritize & Project Charter RACI / Control Measures Policies & Procedures Tax Central Repository / Tax Dashboard The level 4, 5 and 6 To-Be standardized process design and documentation for tax has been delivered Validation workshops Tax strategy workshop Prioritize standardization topics Develop project charter for all key defined projects with the objective to schedule budget and resources Design To-Be standardized RACI s and Control Measures for all tax processes on level 5 and 6 Assumption that level 4 design has been performed by xxx. Draft To-Be Tax Policies & Procedures Tax Policies & Procedures will be based on existing materials Functional design req. repository for shared, standardized processes, information, resources and policy & procedures Functional design req. dashboard to create clear overview of tax kpi s Q1/ Q1/ Tax processes, RACI, Control Measures and Policies & Procedures Pilot implementation: 1. Selection of countries / entities / tax processes 2. Current state analysis 3. Fit-gap analysis 4. Implementation of Tax processes, RACI, Control Measures and P&P Review/Analysis Pilot Implementation Pilot implementation review consisting of: 1. Evaluate of pilot implementation (1) start-up and design, (2) Implementation and (3) Handover, Operations and User Perspective 2. Lessons learned per key issue, lessons and action (to be) taken 3. Transition to Roll-out Q2/ / 2016 Roll-out Tax processes, RACI, Control Measures, Policies & Procedures, Central Repository and Tax Dashboard 1. Remaining countries / entities / tax processes 2. Current state analysis 3. Fit-gap analysis 4. Implementation of Tax processes, RACI, Control Measures, P&P, Tax Dashboard and Central Repository Remaining standardization topics Roll-out (based on project charters) remaining standardization projects

27 Questions and answers

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