2. In theory, using your ERP or financial
package fixed asset subsystem for tax
should be your best option.
I know. They’ve told you it will work for
tax.
But will it?
3. OK…Here are the TOP 10 reasons
why your ERP fixed assets module might not work for tax!
(as shared by your tax colleagues out there)
4. Think about it…they were built for
Accounting and Finance. NOT for tax.
In fact, ERP vendors
do not have tax
technical folks on staff.
All tax must be coded
in by consultants.
5. There are and will continue to be tax
law changes every year…
This will require coding
changes each year.
ERP is a mission critical
application, IT usually
makes tax wait to do
updates.
6. Tax needs an unlimited amount of
different book calculations and special
calculation needs
• Federal Tax (w/bonus
depreciation or without)
• AMT
• ACE
• E&P
• State Books
• Canadian and other Foreign
Books
• Different calendars (52/53
wk. years, short yr.)
• Different basis across books
7. Tax doesn’t always have access to
the ERP to modify asset details
• May get audited and
need to adjust basis
• May need different
GAAP to Tax placed in
service dates
• Current and prior year
adjustments
• Changes to tax
classification
• Modify life
8. Tax sometimes needs to run assets as if
they were calculated based on
different rules as of their placed in
service date
Ensure proper
“Life to date historical year
calculations” by year tax
treatment
10. Tax has to report single, consolidated,
and subconsolidations as well as by
business unit, location, etc.
Need to be able
to report easily
with any kind of
structure and
grouping
11. Tax must see all asset details and
history…and report on prior years!
Most ERP’s roll
forward year to
year and prior
depreciation
expense becomes
accumulated
12. Tax needs to reconcile from book to tax!
Ease is essential.
Not offline or by
using Excel
One click
reconciliation
reporting
13. Tax needs forms and many reports!
Easy, quick and able to export to Excel.
Reconciliation
Roll forward
Transactions
Depreciation
Tax Reports
State Reports
Bonus Depreciation Reports
Audit Reports
And on…and on…and on…
14. Don’t think you don’t have an alternative solution!
• Take a serious look at your options
• Don’t just take people’s word for it
• Investigate further… Do your
homework!
• Other tax professionals will share their
experiences!
• Don’t “sell” the tax department short.
• There are third party solutions that
can make your life sooo much easier!
15. Thank you for reading!
For more information, contact me at:
Kelley Lear
Kelley.Lear@redmoonsolutions.com
941-379-7108
www.redmoonsolutions.com
blog.redmoonsolutions.com
www.twitter.com/redmoonsolution
