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Small Firm Delivers Big Savings

Ariba saved close to $1 million in tax payments and equalization payments alone.

September 18, 2003
Related Topics: Finance/Taxes, Expatriate Management
Employees: 820

When Debbie Haynes, global mobility consultant for Ariba, needed an overseastax accountant, naturally she thought of the Big Five accounting firms, becausein her experience, they were the only ones that offered these services. So whenher team set up interviews, it was with four of the top five firms--and arepresentative from a relatively small firm, Global Tax Network, because it wasrecommended by a coworker. "I met with them as a courtesy," she says, "butin my mind, I was only considering the Big Five."

    That is until the meetings took place. In the first four meetings, Haynes wasgiven slick presentations by the big firms touting their product offerings. ThenDavid Kolb from Global Tax came in. "He blew our socks off," she says. Andnot because he had a flashy multimedia show or fancy brochures. What impressedher was that he sat down and started asking questions about her needs. "It waslike he interviewed me," she says. He asked what their expatriate programneeded, how the company felt about the service, how the expatriates felt aboutthe service, and what they thought was missing. "His approach was refreshing,"she says. "It was a big revelation. I assumed the Big Five were my onlyoptions."

    Haynes hired Global Tax in 2000 to manage the 15 expatriates Ariba had inGermany, France, the Netherlands, the United Kingdom, Japan, and Australia. Thatincluded taking over the financial situations left by the previous firm. "Thefirst year was a nightmare for him," Haynes says of Kolb’s work cleaning upunfinished tax business for the program. He reviewed all the foreign anddomestic tax returns for every expatriate and discovered that many of them hadnever been filed and that tax equalization payments hadn’t been made, shesays. By the end of the year, however, he had resolved all the problems, andsaved Ariba close to $1 million in tax payments and equalization payments alone."We could not have done this without him," she says.

    Along with the $1 million savings from previous years, Haynes now pays lessfor expatriate assignments, thanks largely to the one-on-one support she getsfrom Kolb, which includes individual training on foreign tax laws and how tostructure expatriate packages so the company benefits from various tax treaties."He went over our expatriate policy and told us word for word what makes senseand what we can do differently to save money," she says. For example, hecreates different payment structures based on the length of the assignment, andshows Haynes’s team how to monitor the number of days that expatriates areworking in a particular country to establish which country receives which taxdollars. He also helps them create tax-payment policies for non-company income,which her old firm never addressed. "He always tells us how to reap everybenefit possible."

    But the real payoff in choosing a tax firm that focuses on customer serviceis the relationship, Haynes says. She knows that, day or night, if she has a taxproblem, she can call Kolb, who is a partner in his firm. "You never get helpfrom someone that high up at the bigger firms," she says. She also finds thatAriba employees prefer working with the smaller firm because the team is morepersonal and helpful. "We have a good rapport, which makes everything easier,"and that, she says, is what every tax firm should deliver.

    Haynes advises anyone shopping for a foreign tax firm to make sure theservice they get is worthy of the fee. "That means access to an expert whenyou need it, customized plans based on your company’s policies and needs, anddetailed invoices that show you what you are paying for," she says. "If youare not getting that, there are alternatives."

Workforce, June 2003, p. 102 -- Subscribe Now!

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