TCPI WEB CAST PARTICIPANTS SHARE THOUGHTS ON FIN 48 IMPLEMENTATION
More than 3,000 tax professionals recently responded to a survey on FIN 48 during a web cast sponsored by the Tax Council Policy Institute (TCPI).
The web cast focused on implementation issues relating to the cumulative effect calculation including the “unit of account”, the threshold for recognition and measurement of uncertain tax benefits, as well as the evaluation of subsequent changes in judgment and considerations surrounding new disclosure requirements. Of the respondents, fifty eight percent of tax practitioners expect increased audit activity from the IRS and other tax authorities resulting from increased disclosures under FIN 48, according to survey data from the Tax Council Policy Institute (TCPI).
“FIN 48 is a significant change that applies to all business enterprises subject to income tax and all income tax positions” said Roger LeMaster, Executive Director of TCPI. “For some companies, it represents new challenges, such as increased documentation and disclosures, changes in tax provision processes and controls, and the potential impact on overall tax liability. Based on the interest in this Webcast, it’s clear that there is a need for information and understanding of how implementation of FIN 48 will impact business.”
Nearly half (43 percent) of respondents indicated they do not know yet what financial impact the implementation of FIN 48 will have on their companies’ bottom line. Only 19 percent believe it will result in a significant financial statement impact, while 38 percent believe that it will not. Thirty nine percent said that several factors will be major challenges to their organizations, including inventorying uncertain tax positions, developing support for measurement of tax positions, resolving classification issues, and determining what disclosures will be required.
The polling questions were asked throughout the web cast, which featured a panel of noted professionals: Paul Beswick, Practice Fellow, Financial Accounting Standards Board; Chester Abell, Partner, Director of Tax Accrual Services, Ernst & Young, LLP; and Brett Cohen, Partner, PricewaterhouseCoopers, LLP. Neil Traubenberg, Vice President of Taxes, Sun Microsystems, served as the moderator. The archived Webcast can be accessed here
The web cast was a precursor to the upcoming Eighth Annual TCPI Symposium, “Understanding the Global Tax Arena: Risk & Regulation,” which will be held February 1-2, 2007 in Washington, DC. In addition to FIN 48, the Symposium will feature topics most critical to corporate tax executives, practitioners, academics, regulators and policy makers, including global tax risk policies, and the development of worldwide and regulatory approaches that will impact businesses.
Each year TCPI chooses program managers to help create and execute its annual Tax Policy & Practice Symposium. This year Ernst & Young LLP and Skadden, Arps, Slate, Meagher & Flom LLP have been selected as the program co-managers by TCPI. They will collaborate with the Symposium Planning Committee which is made up of over 25 top tax professionals from major multinational businesses.
The Tax Council Policy Institute is a non-profit, 501(c)(3) public policy research and educational organization. It was created to help bring about a better understanding of significant tax policies that impact businesses and the economy through careful study, thoughtful evaluation and open discussion. The annual Tax Policy & Practice Symposium is one of the programs utilized by TCPI to accomplish its mission.
For more information on the Symposium or to register please visit www.TCPI.org.