Adding Value In A Time Of Volatility Tax Topics For The Financial Services (Part 1)

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Adding Value In A Time Of Volatility Tax Topics For The Financial Services (Part 1)

As the recent financial crisis continues to reshape the global

financial services industry, there are many institutions who are

viewing this as an opportunity to 're-invent' the way they

do business. These institutions are examining what structural

changes their business will require in future, what long-standing

business processes need updating to meet the new market reality,

and what legacy systems are in need of an overhaul. They are also

examining their strategic direction, deciding what markets they

want to compete in, and even challenging the type of financial

institution they should be categorized as.

One key element of this business 're-invention' is to

carefully consider the tax impact of each of these market driven

changes. For example, acquisitions or divestments can have a

significant impact on the tax efficiency of an organization

– particularly the utilization of recent tax losses at

some business units – and this impact needs to be taken

into account before executing any deal. Tax considerations should

also be part of any operational redesign, with plenty of

opportunity to update transfer pricing models to the new

environment, or to further integrate tax reporting into finance

transformation programs. Finally, tax issues also need to be

included as institutions reshape their talent strategies,

particularly in their approach to executive compensation.

As the financial landscape continues to change, Deloitte's

Global Financial Services Industry network is committed to

providing continued thought leadership, surveys and studies on the

issues most important to global financial institutions.

Deloitte's aim is to help guide...

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