The timeliness and accuracy of tax data are chronic causes of concern for the office of the CFO. Over the last two decades, companies have invested heavily in enterprise resource planning (ERP) and financial consolidation systems in an effort to improve transaction efficiencies and shorten close cycles. The introduction of legislation early in the millennium — Sarbanes-Oxley in the United States, for example, and new regional laws in other areas of the world — led to additional investments in controls to support the numbers. The success of these new finance systems, however, has had a limited impact on corporate tax, the department that needs the most detailed financial information, and the one that is responsible for managing the biggest expense item in the company P&L: the income tax.
With the new global legislative demands and the risk that is inherent with a manual spreadsheet tax provisioning/reporting process, companies need to turn to technology to automate the process and mitigate risk.