Ventana Research Analyst Perspectives

Transforming Tax Departments into Strategic Entities

Posted by Robert Kugel on Feb 1, 2016 8:20:35 AM

The steady march of technology’s ability to handle ever more complicated tasks has been a constant since the beginning of the information age in the 1950s. Initially, computers in business were used to automate simple clerical functions, but as systems have become more capable, information technology has been able to substitute for increasingly higher levels of human skill and experience. A turning point of sorts was reached in the 1990s when ERP, business intelligence and business process automation software reduced the need for middle managers. Increasingly, organizations used software to coordinate activities as well as communicate results and requirements up and down the organizational chart. Both were once the exclusive role of the middle manager. Consequently, almost every for-profit organization eliminated management layers so that today corporate structures are flatter than they once were. Technology automation also eliminated the need for administrative staff to perform routine reporting and analysis. Meanwhile, over the course of the 1990s, the cost of running the finance department measured as a percentage of sales was cut almost in half as a result of eliminating staff and because automation enabled companies to scale without adding headcount. During the last recession, companies in North America and Europe once again made deep reductions to their administrative staffs, relying on information technology to pick up the slack.

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Topics: Sustainability, ERP, Governance, GRC, Human Capital, audit, finance transformation, legal, LongView, Tax, tax compliance, tax department, tax optimization, tax planning, Analytics, Business Analytics, Business Performance, Financial Performance, Oracle, CFO, Risk & Compliance (GRC), Vertex, FPM, Innovation Awards, international tax, Thomson-Reuters multinational

Giving Tax Departments More Corporate Clout

Posted by Ventana Research on Feb 17, 2015 7:57:13 PM

One of the issues in handling the tax function in business, especially where it involves direct (income) taxes, is the technical expertise required. At the more senior levels, practitioners must be knowledgeable about accounting and tax law. In multinational corporations, understanding differences between accounting and legal structures in various localities and their effects on tax liabilities requires more knowledge. Yet when I began to study the structures of corporate tax departments, I was struck by the scarcity of senior-level titles in them. This may reflect the low profile of the department in most companies and the tactical nature of the work it has performed. Advances in information technology have the potential to automate most of the manual tasks tax professionals perform. This increase in efficiency will enable tax departments to fill a more strategic, important role in the companies they serve.

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Topics: Big Data, ERP, Governance, GRC, audit, finance transformation, legal, LongView, Tax, tax compliance, tax department, tax optimization, tax planning, Analytics, Business Analytics, Business Performance, Financial Performance, Information Management, Oracle, CFO, Risk & Compliance (GRC), Vertex, FPM, Innovation Awards, international tax, Thomson-Reuters multinational

Tax Data Warehouses Become Essential as Governments Raise the Ante

Posted by Ventana Research on Sep 3, 2014 9:19:04 PM

I’ve written before about the increasing importance of having a solid technology base for a company’s tax function, and it’s important enough for me to revisit the topic. Tax departments are entrusted with a highly sensitive and essential task in their companies. Taxes usually are the second largest corporate expense, after salaries and wages. Failure to understand this liability is expensive – either because taxes are overpaid or because of fines and interest levied for underpayment. Moreover, taxes remain a political issue, and corporations – especially larger ones – must be mindful of the reputational implications of their tax liabilities.

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Topics: ERP, Governance, GRC, audit, finance transformation, legal, LongView, Tax, tax compliance, tax department, tax optimization, tax planning, Analytics, Business Analytics, Business Intelligence, Business Performance, Financial Performance, Information Management, Oracle, CFO, Risk & Compliance (GRC), Vertex, FPM, Innovation Awards, international tax, Thomson-Reuters multinational

Longview Tax Software Helps Tax Departments Be More Strategic

Posted by Robert Kugel on Jun 22, 2014 10:40:56 PM

Longview Solutions has a longstanding presence in the financial performance management (FPM) software market and was rated a Hot vendor in our most recent FPM Value Index. Several years ago it began offering a tax provision and planning application. I think it’s worthwhile to focus on the tax category because it’s less well known than others in finance and is an engine of growth for Longview. We expect larger corporations increasingly to adopt software to manage direct (income) taxes to improve the quality and efficiency of what today in most companies is an inefficient, spreadsheet-driven process.

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Topics: ERP, GRC, audit, finance transformation, legal, LongView, multinational, Tax, tax compliance, tax department, tax optimization, tax planning, Analytics, Business Analytics, Business Performance, Financial Performance, Governance, Risk & Compliance (GRC), CFO, FPM, Innovation Awards, international tax

Informatica and Exterro Partner for More Effective E-discovery

Posted by Robert Kugel on Nov 1, 2013 7:07:45 AM

Informatica and Exterro have announced a partnership in the market for discovery of electronic data and documents (known as e-discovery). Exterro has made its reputation in e-discovery workflow and legal holds management while Informatica is a leader in data integration that our Value Index finds as the top and Hot rated provider. The partnership is designed to provide users of Exterro’s Fusion E-Discovery software with a single point of control for organizing and managing legal and preservation holds (that is, preventing electronic data from alteration or deletion) of unstructured and structured data that are held in Informatica’s Data Archive. Informatica specializes in the efficient management of information assets, which our benchmark research shows is not easy for most organizations to do because they have data spread across multiple applications and systems: Two-thirds of organizations said that this makes it difficult to manage information. By consolidating in a single repository the storage of information that is likely to be the subject of discovery, companies can simplify and cut the cost of the search process as well as reduce risk. Orchestrating legal and preservation holds can be complex since multiple people or groups within a company may be legally involved with the same data over an extended period of time. Moreover, it’s important to ensure that once the holds are no longer needed, all data that can be eliminated is eliminated.

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Topics: Sales Performance, eDiscovery, Exterro, legal, Operational Performance, Business Performance, Data Governance, Data Management, Financial Performance, Informatica, Information Applications, Information Management, Workforce Performance, compliance, Data, Information, Risk