STAY AWARE: Hiring Trends In Corporate Tax Departments Now And For The Future

STAY AWARE: Hiring Trends In Corporate Tax Departments Now And For The Future

About five years ago, when we surveyed thousands of executives on corporate tax departments trends, I recall one tax executive’s comment vividly… “ The Corporate Tax Department of the Future Will Be Very Different From The Tax Department Of Today.” This comment was emailed to me by a prescient corporate tax executive five years ago. This tax executive provided an insightful understanding of trends that were about to take place. The focus of this post is to discuss trends we now see that are happening behind the scenes in the tax community.

With thirty years’ experience being retained by corporate tax clients to find tax executives, I am highly qualified to discuss hiring trends well in advance of the market understanding the trends currently unfolding around them. The last prediction posted in my blogs a couple of years ago was easy in that I stated once tax professionals start working remotely, they would not want to go back to the office. In this post, I will bring to your attention where we see rising activity in hiring trends and the cost to corporations who do not understand the importance of the technology experts they employ.

Recently, I communicated to a senior management tax executive of a private equity firm my advice on the most important person they should have in-house on their acquisition team. Over the years, they have learned the importance of a strong in-house tax team who can assess the challenges they will face while conducting mergers and acquisitions. While in the past the focus has been on highly strategic tax planning, these teams are becoming ever more careful of the challenges they face in the integration of the software of two separate entities. In some cases, hundreds of millions of dollars of software purchases would not work to integrate two separate systems. This is a software trap many companies are walking into these days. It is messy and it is very expensive.

Once these companies realize they have significant software integration obstacles and the costs are mounting to fix these costly problems they start paying attention to them! When the top IT Executive cannot produce the miracle mile to fix the integration challenge because the software is incompatible, outdated or simply does not work, blame is thrown in every direction. These scenarios remind me of the years of many calls I would received from CFOs who made an acquisition that resulted in a huge and costly tax problem because of the way the deal was structured. The tax issues could have been avoided if the CFO would have pulled the tax executive into the business discussions early. There are many CFOs out there who never construct a deal without involving their tax executives; these are the CFOs saving companies millions in what would otherwise be lost revenue. Now these same CFOs are learning the extraordinary costs associated with incompatible technology software when making acquisitions.

Companies who are performing optimally will not cut corners in attracting the most technically talented to their organizations. However, they should not expect their lead tax executives to know or be burdened with knowing the technical aspects of software integration. These specialty tax software experts are being made and developed now through extensive training in many accounting firms. There are a few technology experts available; however, the demand is trending much higher for this talent in this emerging tax industry profession.

Tax professionals who have strong tax technical skills are important to organizations developing more automated solutions for information production.

While working on a very challenging search for a client seeking an expert on tax software, I learned quite a bit about how to find these difficult to find tax and technology professionals. The first thing I discovered is the wide range of titles these professionals have making it nearly impossible to find them on a search assignment. It took us hundreds of hours of detailed research and then substantial one on one interviewing and investigation to identify tax professionals with the skills required. It was not obvious from looking at their titles exactly what tax professionals had the requisite skills required for our particular client. In the case of this tax technology search, the tax professionals’ tax software skills were hidden behind their technical tax rule and regulation skills. It requires real investigative experience to identify tax software experts who have the precise expertise required to do the job. We need to work ten times harder on these searches.
When you reach out to hundreds of possibilities on a search and talk to people you learn a lot. What was learned recently from industry experts in corporate, public accounting was the following:

1. Many companies did not upgrade tax and financial software during pandemic due to costs.

2. There are numerous companies who did buy software and discovered it does not work because it is incompatible with outdated in-houses systems and software. I know several organizations who had to send the software they bought to the scrap pile because it simply does not work with their tax and accounting software systems. No one wants to talk about a 100M spend on tax and financial software that is not compatible with all the needed software updates of programs and code constantly updating across multiple platforms. Imagine spending tens of millions of dollars or hundreds of millions of dollars on systems software that does not integrate with your current outdated software programs because management has not updated their software in years. Who do you blame for the herculean software failures? The CEO or CFO who purchased the software from a sales team who assured them the software would work? Does the company blame the information technology executive because they cannot integrate incompatible software? Does the tax or accounting department get stuck with old and incompatible technology infrastructure that cannot be properly implemented or maintained? Today, the blame is being passed around for herculean technology challenges and people are being unfairly blamed for the software failures in companies around the world. If I were an Executive at a Private Equity firm involved in mergers and acquisitions, I would have my own HOT SHOT technology team go in and evaluate what kind of software challenges you potentially have on each deal as this one act alone will save you a lot of wasted time, effort, and money down the road on mergers and acquisitions.

3. Companies spend considerable time strategizing how to put the deals together, a foresighted company will be ahead of the pack armed with a team of experts working together to see what type of troubles they are walking into with the software the merger or acquisition you are considering. Know the problems you will be acquiring. These company executives often do not even know themselves as in-house IT departments are afraid to tell management the software selected does not work and they just spent 100M on incompatible software. The company may blame these problems on the IT person for being unable to do the impossible and releases perfectly good talent. It takes a team of great tax and technology experts working together to make the magic happen.

Tax and technology experts are trending to be the most important hires of the future saving companies hundreds of millions in costs and hundreds of hours of lost time and productivity. You must prepare to have all hands-on-deck with tax and technology issues.

There are two software companies who have built their own platforms which are being are constantly updated and maintained that we hear about wonderful experiences. Corporate tax executives searching for an affordable Tax Calendar are moving to the easily customizable AKORE Tax Calendar. If you want to start organizing tax due dates clean from scratch then this is a great Tax Calendar to organize your corporate tax activity and dates.

If you want an incredible research tool, you will want Orbitax. I just spoke to a tax author who has written several tax books for the biggest tax publishers and he praises of all of the Orbitax Solutions. They also have a track record of being highly ethical!

If you currently have a need to hire any management level tax executive, I welcome your calls so we can help you through our tax executive search division. Contact kat@taxconnections.com or call 858.999.0053 X100 or text Kat at 858.232.4415 any day of the week to schedule a call.

TaxConnections is where to find leading tax experts and technology around the world. Discover tax professionals who offer you a wide range of tax expertise and be more informed about the technology that supports them in operating efficiently and successfully.

TaxConnections connects tax professionals with new tax clients and tax jobs around the world. Tax Professional Members establish higher visibility online so prospective clients and employers can find our members easily. Each members also receives a Virtual Tax Office which is the most valuable online real estate available today! TaxConnections makes a difference in your professional life.

We offer a Special Membership rate to tax professionals out of work.
https://www.taxconnections.com/special-membership

Kat Jennings, CEO
TaxConnections
858.999.0053
kat@taxconnections.com

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