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In our experience, the management of apportionment data is one of the largest points of pain in the corporate tax department. It is a huge source of inefficiency, as apportionment data must be touched repeatedly throughout the year – provision, compliance, estimated tax payments, planning and day-to day decision making. It is also a tremendous source of inaccuracy. Quite often, the trail of apportionment sourcing and positions is buried or lost during the frenzy leading up to the filing of a company’s tax returns. The presence of special industry apportionment methods, cost of performance positions, and intercompany eliminations, all traditionally take place offline in multiple Excel spreadsheets. Add to that the often undocumented process of gathering and consolidating apportionment data from a multitude of business units, corporations, and flow through entity structures through a combination of data files, spreadsheets, tax packages, and even emails between tax department staff and/or outsourced partners often produces predictably painful results.
Liquid Engines’ tax management software can significantly ease the burden of managing state apportionment. Our STx apportionment capabilities provide a solution to these challenges:
- — Every system or spreadsheet that feeds apportionment data (e.g., general ledgers, fixed assets, payroll) can be bridged directly into STx where business unit rollups, multi-tier pass-through entity calculations, combined and consolidated group calculations, and state-specific rules are applied. The apportionment data is then ready to seamlessly and consistently feed the tax provision, compliance, estimated tax payments, planning and routine decision making.
- — STx contains the jurisdiction specific rules for computing apportionment by entity as well as the flow logic for complex multi-tiered partnership structures. With a comprehensive database of historical, current and future tax rates, our application becomes a central location for blended rates by entity for every jurisdiction, driving accuracy into the provision and estimated tax processes.
- — With STx, the tax department can gain visibility into apportionment flowing from tiered partnerships and gather insight into combined group apportionment calculations by entity or business unit. Our robust reporting capabilities ensure that multiple users can access the data, in hard or soft copy, in ways that best meets their needs.
- — Make go-forward or what-if apportionment changes without losing the integrity of your compliance data by using Liquid Engines scenarios to compartmentalize your apportionment data. You can easily move data between scenarios in-bulk or tactically using import and export features.
- — Liquid Engines’ web-based solutions can be deployed in-house or hosted, allowing a wide range of accessibility options for tax department professionals and outsourcing consultants.
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