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Synergy 2017 – What did we learn?

By: John P. Bennecke James T. Hedderman Ryan McKenzie Lauren Ansley David Flores |

Our ASC 740 team recently returned from the Synergy 2017 ONESOURCE Conference in Nashville, which took place November 12-15th. We wanted to share some worthwhile takeaways in case you weren’t able to make it. These are just a few of our observations and are not meant to be a complete conference overview.

  • If you haven’t converted to the most recent version of ONESOURCE yet, you’re not alone. The conversion to the new version has been successful, but many companies are taking time to make the transition.
    • If you are converting from Active Work Papers to Work Papers, consider contacting your ONESOURCE client service manager to provide for a smoother transition.
  • ONESOURCE Dataflow templates are being created for multiple purposes. From international calculations, data collection efforts,  to summarizing key tax issues and positions across the globe and improving controls globally, ONESOURCE Dataflow has been a tool incorporated by many users in recent years. If you’re one of the many users who are trying to customize Data Flow for a new purpose, we can help you customize your journey.
  • We recommend using Docs and Database to document your Internal Controls processes. Both of these tools work great to help you identify, build, and document critical steps in the Provision process.
  • Robotic Process Automation (“RPA”) is gaining momentum in the tax arena, more to come as to how this may be utilized in the tax department of the future.

Tax Reform is near (ish)

As you can probably imagine, there was a lot of talk about Tax Reform and how it will affect companies around the world. Proactively planning to deliver to your C-Suite, we’re recommending our clients use ONESOURCE products like WorkPapers and Data Flow to estimate the impact Tax Reform will have on your company. The following are things you can easily check using ONESOURCE:

  • Impact of reducing the Federal Tax Rate from 35% down to 20% for Corporations – Don’t forget about the deferred tax impact as well!
  • The loss of the domestic production activities deduction (I.R.C. Section 199)
  • It is anticipated that as part of both the House and Senate tax reform bills there will be a so called “repatriation tax” on the previously undistributed earnings earned by U.S. owned foreign subsidiaries.  In order to take this potential impact into consideration for your organization, we suggest proactively analyzing (or calculating) the earnings and profits of each foreign corporation that is at least 10 percent owned by your organization.  Professionals should also analyze the make-up of the assets that contribute to these earnings, as there may be a different rate of tax for earnings associated with cash or cash equivalents.
  • Clients should consider implications of the reduced U.S. corporate tax rate when being a foreign owned company, subject to Base Erosion Profit Shifting (“BEPS”) and Global Intangible Low Taxed Income (“GILTI”).  Do a “health check”, model out supply chain, IP structure, IC transactions and how they affect the business.
  • Territorial vs. World Wide Income – Clients should start looking at the International impacts of Tax Reform dealing with shifting from a World Wide to a Territorial system with a Dividends Received Deduction.  Other items to consider as part of this move are Base Erosion Alternative Tax (“BEAT”) and Foreign High Return Income (“FHRI”).
  • NOL Carryovers – Clients should look at the opportunity to maximize the usage of using their carryback and carryforward NOLs, carryforward utilization will likely be limited.

If you would like to discuss your income tax provision or  return compliance process please reach out to a member of our team.  We are here for you!