Question To Ask From A Software Selection

Indirect Tax functionality can be automated (full or to a certain extend) in a company’s own ERP system. The problem might be that multiple ERP systems are used and that interfacing via a third party tax engine is considered an alternative. That option means that part of the system functionality is actually outsourced.

Some important questions from a tax software selection to ask

1. Does remediation of own ERP systems close any gaps?
2. Is setting up a single ERP platform within the company a practical solution to consider?
3. Are third party solutions available to harmonize multiple ERP systems?
4. What is the advantage of third party solution compared to upgrade own ERP system(s) (GAP versus SWOT analysis: complexity of business model, number of tax codes needed now and in the future, resource requirements to manage the rules and VAT rates, monitoring and controls)?
5. Is a third party solution required for determination and calculation of indirect tax or only for the reporting?
6. What reporting functionality does my organization need?
7. Are risks of outsourcing functionality known, documented and managed?
8. Are the liability clauses of the third party known and evaluated?
9. Is the financial position known of this third party?
10. Is the market position known of this third party (sustainability, competitor’s strength)?
11. What is the feedback of customers (references and credentials)?
12. What is the amount of staff of this third party?
13. What is the company’s history where it relates to upgrades its technology to trends in the tax market and client needs (amount of upgrades)?
14. Is the solution compatible with existing ERP environment?
15. Is the IT architecture of the third party solution compatible with the existing IT landscape?
16. Is the interface of the solution “approved/supported” by the ERP system supplier (i.e. SAP Netweaver partner)?
17. What will be the level of configuration / customization in ERP system and/or third party solution?
18. How much time does it normally take to implement a country, region or even a big bang roll out?
19. Does the third party have an example of a roadmap for implementation that includes each others roles and responsibilities and milestones?
20. Which countries and indirect taxes are supported by the third party solution?
21. What is the impact on the company’s own resources?
22. What does the price tag look like (initial fee, configuration fee, license / usage fee, maintenance fee, etc.)?
23. What is the level of support a vendor gives in case of trouble shooting, legislative updates, irregular maintenance, etc.?

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