In a survey of CFOs conducted during the week of March 3-9 by Financial Executives International (FEI) and Baruch College's Zicklin School of Business, confidence in the U.S. economy remained low, and many are taking action to protect their own businesses and workforce, but aiming to avoid layoffs if possible through alternative means such as salary freezes, elimination of bonuses, redistribution of responsibilities, shortened workweeks, and more. Read details in this FEI press release. Complete details are in this report published by FEI's research affiliate, the Financial Executives Research Foundation (FERF),
In other news, FERF published today a study entitled Trends in Income Tax Reporting Automation. The study, conducted by FERF Research Associate Thomas Thompson, Jr. consisted of interviews of senior financial executives about their own tax automation experiences.
"We heard that there are challenges to automating income tax reporting,” said Thompson. “Nevertheless, automation is emerging as the standard for companies that are committed to improving transparency and internal control.” On the other side of the coin, many executives commented that the primary obstacles to tax automation are time and budget, along with traditional “change management” issues.
Some of the benefits of tax automation noted in the study include:
- Reduced tax cycle time;
- Less effort and more accuracy associated with tax data collection and transaction entries;
- Increased process visibility and control;
- Greater regulatory compliance and process standardization;
- Increased financial transparency and comprehensive audit trails;
- Fewer deficiencies identified by reviews under Sarbanes-Oxley Section 404; and
- Freeing up of resources for more higher-value tasks, such as tax planning, modeling and analysis.
Daniel S. Jones, Managing Director of DS Jones & Company, a management consulting firm based in Connecticut, pointed out that a client with offices in 40 countries had a decentralized process where local tax executives and controllers handled their own reporting. “They were previously using Excel spreadsheet, but errors were fairly routine, and previous attempts to standardize were not successful.” After hiring a new Tax Director, the company decided to automate. This helped them standardize and ensure regulatory compliance, produced more accurate financial reporting and reduced process cycle time, allowing more time to do analysis.
U.S. FEI members may download the full study for free at the FERF Bookstore. Non-members can purchase FERF reports. Free FERF reports are one of the many benefits of FEI membership, along with our monthly magazine, Financial Executive, our bi-weekly electronic newsletter, FEI Express, our detailed web summaries of current developments, discounts for attending our conferences, and more! Thinking about joining FEI? New members who join by April 6 can attend our Summit conference in May for free! Feel free to contact me if you have questions about FEI membership at firstname.lastname@example.org .