RPA enables tax pros to focus on planning

Robotic process automation can be piloted by tax

Tablet displaying graphs and icons It’s not hard to recognize the value of robotic process automation; RPA relieves staff of repetitive tasks, increases the usability of data, virtually eliminates errors and boosts efficiencies. Tax professionals would welcome any of these results, but is there a greater reason to advocate for RPA investment?

The significant benefit that RPA offers to tax is the ability to focus on higher-value functions. Automated processes free up time to plan. They also inform strategic planning. Tax professionals can draw on RPA’s instant delivery of pertinent information, and its predictions based on patterns and data. With tasks such as compliance simplified, they can move to more valuable strategic analysis and visualization.

RPA trendThe investment payoff can be extended as the tax practice conducts an RPA pilot for the rest of the organization — assistance likely welcomed. Most companies are anxious to get into the game or expand their participation. A full two-thirds of companies are looking to increase their investment in digital transformation within the next year, per findings of Grant Thornton’s 2018 CFO Insights on New Technologies survey. Where will they start? According to Carli McClure, managing director of Tax Innovation, tax ranks in the top three best places to begin an automated journey. The other two starting points belong to finance. The CFO’s RPA launch in accounts payable and accounts receivable could be done in cooperation with the launch in tax.

Get guidance in RPA launch and development In their journey to RPA maturity, tax practices across industries are at widely varying points. Most have barely begun, not yet having developed an implementation plan. Those at midrange are basically at the robot testing stage. Others have surged forward with operational systems. At some point, however, all tend to be slowed down by the need for governance and scalability of their model. This is the case even for those at the cutting edge, such as one manufacturer with 50 robots and an RPA center of excellence. From the beginning, a tax practice must find guidance in understanding RPA and what it can do. It must also locate its sponsors — in the business unit or IT, or with outside consultants.

Get guidance in RPA launch and development To build a business case, tax professionals and their guides ask and answer pertinent questions:

  • What should we be automating?
  • What are the priority areas?
  • And where’s our low-hanging fruit?

Carli McClureA good fit for RPA

“Indirect tax is an easy place for an organization to start without having to get into too much ‘technical speak’ with developers.”

Carli McClure, Managing Director, Tax Innovation
A sound beginning point is indirect tax. “A few sales and use tax ideas include reverse audits, exemption certificates, and exception reconciliations — these are great tasks to assign to RPA,” said McClure. “Indirect tax is extremely consuming and repetitive, and typically happens every single month. It’s a huge resource effort. Indirect tax is an easy place for an organization to start without having to get into too much ‘technical speak’ with developers.” It’s a good fit for RPA. The procedures are carried out in keystrokes, a basic task for a robot.

Direct tax — printing and efiling returns — would be the next choice. “Something that seems so simple, but if you’re a multinational company, printing pro formas could be a huge task,” said McClure. Automating indirect and/or direct tax tasks can produce successful results early on. It’s the right training ground for bigger RPA projects.

Be sensitive to resistance Even after notable results in the first case, there will be challenges to understand and address. The primary concerns are cost, jobs and ownership.

“A big challenge is the spend,” McClure stated. “But the truth is, you can start a small pilot inexpensively — maybe around $25,000. There are options that don’t put a CFO or tax director as much at risk from a spend perspective. They can quickly show a huge return.”

One of the savings options is leveraging existing staff. This can do double duty as an assurance that employees won’t be replaced by robots. Many have begun to look to the future. Two-thirds of professionals surveyed by Grant Thornton are planning to upgrade their data analytic skill sets in order to keep up with the changes. As for additional staff, a corporate tax department or public accounting firm would do well to seek candidates with IT backgrounds in development or project management. The experience gained in tax robotics can be transferred to roles in other areas of the company.

Phases for instituting RPA “Probably the most difficult challenge is governance,” said McClure. “Governance starts with tax. Who owns the bot process? Who maintains the bots? Coordination of the controls environment is key. Tax, in leading the pilot, needs collaboration with IT and finance for a successful model and a scale-up to make RPA work for the company.”

Leadership in RPA initiatives will entail earning buy-in and support. Tax and company leaders must be partners in change management, explaining the steps along the automation path and communicating strategic goals.

With the goal of more time for higher-value functions, the tax professional has considerable motivation to help drive digital transformation for their own purposes and for those in the rest of the organization.

Contacts Carli McClureCarli McClure
Managing Director, Tax Innovation
T +1 602 474 3473