International Tax Compliance

Converting to Tax Series has enabled Omnicom to lower our international tax compliance cost and has provided us with much more data and reports for both planning and tax accounting.”

Travis Dowell-Assistant Director International Tax

Omnicom Group Inc.

TTI has successfully provided international tax compliance solutions for companies that own as many as 3,000 foreign entities while achieving cost effective solutions for clients with as few as 30 foreign subsidiaries at the same time. As expected, our larger clients require far more complex processing. For such companies, we provide cost savings through automation of tax processing. At the same time, we acknowledge that smaller companies frequently struggle with their international tax compliance primarily due to a lack of resources with the knowledge necessary to effectively overcome the inherent complexities associated with preparing Forms 5471, 8865, and 8858. We provide well-trained resources to ensure efficient and accurate processing for any size company so that they can get the most value out of this already cost-effective service. We also provide hands on training to help companies compensate for their lack of expertise or resources for international tax compliance.

 

Provision Implementation

We recognize the importance of provision software. Consequently, we do whatever is necessary to ensure all of our provision clients get their implementation completed as fast as possible without compromising the integrity of the data and processes. We have achieved true global provision implementation for our clients in a very short period of time. Our average implementation for U.S. Federal and State provision module takes approximately two to three months (even for the largest companies with over 300 U.s. companies).

Generally, non-U.S. provision (foreign provision) implementation comes soon after the U.S. Federal and State implementation is completed. Thus, in most cases, our implementation can be completed over the span of two quarters.

Provision Data Collection

For the most part, calculation of U.S. provision (US Federal and State) does not require the use of a data collection tool. On the other hand, we support non-U.S. provision computation using our data collection module as it supports flexible yet complex local country tax liability computations. Although global provision can be implemented without the benefit of data collection tool, the flexibility to accommodate foreign provision computations in detail is being viewed as great enhancement to most global implementations.

The data from data collection schedules is seamlessly integrated into the global provision process with the simple click of a button. At the same time, local controllers can review their own set of provision reports for their entities so they can maintain deferred assets and liabilities, review effective tax rates, produce journal entries, and maintain the tax liability reconciliation.

Through interaction with compliance data collection and existing data in various parts of Tax Series, eDataCollector ensures that the same data is not required more than once. Also, as Tax Series is a multi-year system, it does not require users to maintain multiple sets of data, thereby avoiding the tedious and confusing processes associated with multiple sets of data maintenance.

Compliance Data Collection

TTI has successfully implemented data collection projects for large companies. With modules flexible enough to support annual and quarterly data collections, eDataCollector has proven to be an effective tool for our clients. For annual data collection, we have, in some instances, as many as 1,000 users reporting tax specific data for a single client globally. Our global implementation of compliance data collections ranges from 30 to 1,000 users per client.

Using built-in task tracking and overall integration with all tax return modules, our clients can pre-populate existing information on each entity’s schedules (trial balance in local ledger format, exchange rates, account balances from prior year, and so forth), automate adjustments, collect look-through analysis data for the Subpart F analysis, collect intercompany transaction data for Schedule M reporting, and other administrative information. Quarterly data collection is used to produce quarterly projected financial results (including that of controlled foreign corporations and their foreign tax credit impact for planning and provision).

In most cases, a global data collection project can be completed in two to three months from its inception. In smaller projects (less than 100 users worldwide), implementation can be completed as quickly as two to three weeks.

Standard Return Processing

We have provided standard return processing services to our clients. For example, we can proudly say that we have processed over 500 Form 5471s successfully for a single client. We have worked diligently to ensure that we can provide the resources, processes, and tools necessary to effectively process Form 5471s as a cost effective and reliable service to our clients. As a testament to our efforts and our clients’ success, we are expanding the standard return processing service to support federal and state return processing as well.

eFile Validation

Over the years, we have found many instances of substantial discrepancies between the content of the paper return and that of the transmission file submitted to the IRS. We discovered these discrepancies by converting our clients’ entire transmission file, which is mostly XML (essentially computer programming code), into a far more legible format – PDF. Thereby, we have been able to grant our clients the ability produce output that is compatible to that of their paper return (on tax forms and spread schedules).

Some of our clients did not even know their transmission file (tax return) suffered from non-inclusion of critical forms (such as Forms 5471, 8865, and 8858) until they became our client and had a chance to review the content of transmission file after it was converted into PDF tax forms and schedules. At the same time, the IRS has enhanced the enforcement of penalties and started sending out automated notices of non-filing.

The IRS and all interested parties (primarily software vendors and professional service providers) are working hard to come up with solutions to the issue of discrepancy between paper return and e-filing. Currently, there is no better solution available other than what we provide to our clients - having the transmission file translated from its confusing XML format into a legible and clear PDF format