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Tax Management Consulting for a Global Agriculture Company

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Abstract

A global agriculture company looked to Deloitte Tax LLP to help its tax function participate in a large enterprise resource planning (ERP) implementation. The company's tax leadership sought strategic direction on transforming the tax function from a good corporate steward to a value-added strategic partner that could act as a catalyst for enterprise-wide initiatives.

We led the client through a series of in-depth workshops to identify the key dimensions of its future state tax operations and processes and helped it apply leading practices to pursue real financial savings and productivity improvements.

The Challenge

The client sought the answer to a simple question: As a tax department, why should we care about a large ERP implementation that our organization might be considering? What’s more, the company needed to clarify the areas in which it should focus its transformation efforts – data or technology, tax processes or staffing issues or all of them.

How We Helped

Deloitte Tax professionals worked closely with the client to develop a business case for tax transformation as an integral component of the ERP implementation, not an afterthought. The first step was to conduct workshops on the company's most critical tax issues, ranging from fixed assets and excise tax, to sales and use tax, foreign tax credit and transfer pricing.

Each workshop was scheduled to include key tax specialists from the client as well as Deloitte. The overarching question we posed to the client was: In a perfect world, what incremental tax value could you deliver the organization with tax-aligned data, systems and processes?

Then we applied our tax transformation methodology to the workshop findings. Specifically, we designed the transformation plan around the six value drivers that are essential to building and sustaining a dynamic tax function:

  • Strategy and execution
  • Regulatory compliance
  • Tax payments and cash management
  • Close, provision and controls
  • Risk and tax controversy
  • Planning and tax-efficient business operations

Next, we helped the client align tax enablers – tools such as data and information, technology and systems, processes and policies, and people and organization – with the vision for the enterprise-wide transformation.

Why Deloitte? Even before Deloitte Tax secured the engagement, the client, which had worked with the Deloitte U.S. Firms in the past, relied on our professionals as a sounding board for a path forward for tax transformation. But it was our tax transformation methodology, applied to the client's circumstances and concerns, that forged the relationship. In addition, the client indicated that Deloitte Tax is the only firm that understands how to deliver in a holistic, transformational manner rather than in narrowly focused, siloed projects.

Solution

The company has seen direct and indirect benefits from its tax transformation. Directly, the client has identified potential annual savings of significant amounts achievable by "tax-aligning" the enterprise initiative. A significant yet indirect benefit has been the momentum the tax function helped drive throughout the entire business and its role as a catalyst for enterprise-wide change.

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