United Kingdom

Audit and Accounting Related Tax Services (AARTS) 

In the face of challenging legislation, regulation changes to accounting standards and increased scrutiny from tax authorities worldwide, tax reporting systems need to be robust, flexible and able to work seamlessly with other reporting processes.

Our services help enable you to respond to the demands of this dynamic environment and deliver accurate and efficient tax reporting. 

 

What's on your Mind?

 

  • Ensuring tax figures are materially correct after a business reorganisation.
  • Manual processes for tax reporting are being stretched due to increased demands and tighter reporting deadlines.
  • Understanding the current and deferred tax implications of changes to accounting standards, both tax and non-tax standards.
  • Lack of internal specialist knowledge of tax accounting requirements, for example, preparing US GAAP tax calculations.
  • Ensuring processes and controls provide the necessary comfort to sign the Senior Accounting officer certificate.

 

Bringing you Peace of Mind


We have technical specialists with practical experience in most areas of tax accounting, combining with technology specialists where appropriate, to provide complete process reviews and implementation. This includes:

 

  • Automating reporting and disclosures
  • Enhancing existing systems and process to give increased functionality and accuracy
  • Undertaking a health check of the tax accounting function and process with recommendations for improvement, including assistance with regard to Senior Accounting Officer certification
  • Providing advice and technical tax accounting training to both tax and finance functions
  • Providing subject matter specialism to an Internal Audit function
  • Preparing the tax numbers and disclosures for management

 

What's in it for you?

 

  • Increased assurance over the reported tax figures and associated disclosures.
  • Increased assurance over systems relevant for Senior Accounting Officer certification.
  • Efficiency gains in the reporting process, enabling the tax function to spend increased time on value added opportunities.
  • Deeper tax accounting skills in the tax function to support the tax reporting process.
  • Opportunity to outsource tax reporting where insufficient in-house experience.
  • Support in selecting and implementing tax reporting technology.

 

Why KPMG?

 

  • We provide Audit and Accounting Related Tax Services to a significant number of the FTSE 100 companies.
  • Over 100 tax accounting professionals in the UK with extensive practical experience of undertaking tax accounting and reporting assignments covering all business sectors.
  • Global Network of local specialists.

Case Studies

Defining reporting requirements

A global business had issues associated with inconsistent timing and quality of tax reporting from subsidiaries and minimal visibility of overseas tax profiles and risks.

 

KPMG worked with the business to help define their specific reporting requirements by tailoring our technology, Tax Reporting Cube, to the specific needs of the business, which provided seamless integration with their general ledgers.


Benefits included:

 

  • Automation of entire process from data collection to global management of high level risk areas to accounting disclosure notes
  • Robust framework for capturing permanent and temporary differences
  • Audit trail and drill down reporting
  • Tax function now spending time reviewing, understanding and planning

 

Full tax support for US GAAP to IFRS conversion and price purchase accounting exercise

 

Client issue

A tax client of KPMG UK, which is an IFRS reporter, acquired a US GAAP reporter in a significant transaction. The client performed the majority of the accounting work in-house, but identified two tax key elements where they needed external support.

 

Firstly, the conversion of the US GAAP results of the target to IFRS and, secondly, the identification and calculation of the deferred tax impact of the purchase price fair value allocation exercise (KPMG Corporate Finance performed the valuation work itself).

 

There were significant areas of judgement within these work streams which have a material impact on the financial statements. Both purchaser and target are audited by other Big 4 firms.

 

What KPMG did:

 

  • Prepared detailed workings to identify, quantify and explain the tax adjustments arising on conversion from US GAAP to IFRS for the last three years
  • Found the required information for these adjustments directly from the acquisition target
  • Liaised directly with clients’ auditors to ensure the rationale for each tax adjustment was explained allowing an efficient and expedient audit process
  • Identified the subjective tax areas of the purchase price fair value allocation exercise before any valuation work was done so the support for valuations did not have reanalysed at a later date
  • Delivered the allocation of purchase price report with simultaneous valuation and deferred tax analysis

 

Benefits for the client:

 

  • Streamlined process where information is sourced directly from the target, analysed and explained to the auditors
  • Combined international tax, IFRS and US GAAP expertise
  • One firm approach where the deferred tax issues are fully aligned with the valuation work performed

 

Contact

Neil Henderson


Neil Henderson

Tax Director

KPMG in the UK

 

020 7694 3466

Email Neil