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Checking on the health of compliance processes has never been more important. In
today's business environment, increased tax process efficiency and
effectiveness can add value to an organization's bottom line, and keep it
compliant with increased regulatory requirements.
As tax resources in an organization keep up with day-to-day operations, it can
get difficult to identify potential areas of improvement within the tax
function. BMR Managed Services’ (BMS) Tax Compliance Process Review provides a
high-level analysis and evaluation of our client’s overall tax processes,
including the remittance of tax, allocation of tax and technology resources,
and management of tax information. The review enables the tax functions of our
clients to understand what is needed to better manage and locate information
for audits, improve workflow management, better comply with regulatory
requirements, and reconcile tax and financial data.
This review is intended to assist the organization towards -
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Adequacy of the existing compliance processes in terms of information capture,
report generation and data retention for the purpose of meeting the identified
compliance obligations
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Adequacy and on-time availability of relevant data and reports for tax planning
and decision making by the Finance & Tax team
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Identification of any improvements, enhancements or modifications required in
the existing processes and systems to effectively meet the statutory compliance
requirements
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Proposed redressal of inadequacy, if any, in the information systems and
processes of the organization and various alternatives available to meet the
requirements with possible recommendations
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Assistance in development of a business case for the recommended solution
BMS compliance process review methodology is structured into the following four
phases:
Phase I - Assessment
During the assessment phase, BMS collects data that can be used to generate a
profile of the tax environment in which the client operates. We may use any
combination of the following information gathering techniques: questionnaires,
informal interviews, client source-documents, and typical tax audit exposure
areas.
As part of the assessment phase, we conduct interviews with key personnel
involved in Procurement, Accounts Payable, Accounts Receivable,
General/Financial Accounting, Information Systems, and Tax. In addition, as
part of the assessment phase, we review the relative strengths and weaknesses
of the tax recording and processing systems.
During this phase we also identify books and records that will be needed to
complete the next phase.
We have found that at a minimum an assessment phase is needed to attain an
understanding of the existing tax issues and compliance processes to better
evaluate the scope of the overall project. This phase also enables BMS to make
basic recommendations on the use tax compliance function of the client’s
business.
Phase II - Design
The design phase consists of a review of the detailed information gathered in
phase I which we then use to develop and analyze a variety of strategies. These
strategies will support company plans for establishing tax compliance
methodologies.
This phase requires a review of the various systems involved in the collection,
payment, accrual and remittance of tax. BMS will review the current
administration of tax function. Phase II includes evaluating personnel
interviews along with books and records made available for research and
planning. This helps us determine whether the information, made available to
regulators, is reliable.
During this phase we set out guidelines for the scope of reports, matrixes and
flowcharts needed for the two remaining phases.
Phase III - Implementation
Phase III consists of implementing the recommendations derived in phases I and
II. Implementation includes focus on utilization of reports, matrixes and
flowcharts.
Phase IV - Training
The final phase of the review involves training of the tax personnel. The
information gathered in the previous phases will indicate the areas where
training is critical. Training may include meetings with employees, group
trainings and one on one instruction for certain key individuals.
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