High-performing companies balance and drive efficiency, control and value across GCR.
Summary: To help companies with the development and implementation of a new GCR model, we put forward the following framework, focusing on four main components of the GCR environment.
- The compliance and reporting elements — statutory accounting and reporting, tax accounting and provisions, income tax compliance, indirect tax compliance, and governance and control
- The business outcomes that an improved GCR operating model enables — market reach, operational agility, cost competitiveness, stakeholder confidence and tax value
- The operational elements of efficiency, control and value that are often in tension but need to be balanced to achieve an effective GCR model
- The transition stages, which involve understanding the company’s ever-changing GCR requirements, defining the operating model and adopting proper processes and systems
Delivering efficiency, control and value
At the center of the framework are the key GCR operational elements. Given the agenda to improve performance, it becomes essential that business leaders assess where they are with GCR today in terms of efficiency, control and value.
The design and implementation of a new GCR model must be an integral part of the design of the broader finance and tax operating model
Determining a GCR operating model involves identifying the core finance and tax competencies required and the people and sourcing model for sustaining access to these competencies.
Companies must determine the optimal use and locations for their internal GCR resources — whether they be in-country, in an SSC or part of a CoE — and, where appropriate, how they will complement internal resources with third-party service providers.
A governance framework must be developed and implemented to manage GCR processes on a global basis. This will ensure control and stakeholder confidence and set a foundation for sustainable cost advantages through standardization, automation and centralization.
Bring rigor and focus to GCR processes
High-performing companies identify opportunities for integration, standardization and more efficient use of data. In addition, companies must include GCR in their information and systems architecture and plans.
This includes extending or making better use of existing R2R systems, as well as actively pursuing additional technologies that enable the core GCR processes themselves. Standardization creates new opportunities for automation.
Both are generally viewed as prerequisites for centralization.