With the increased scrutiny in the audit process on state provision calculations, we believe that a state-by-state provision process that is fully integrated with the worldwide provision process is critical to accurate disclosures. We offer a solution that allows clients to set up their state tax filings in the provision system. The eStateTaxProvision module calculations begin with federal taxable income from the eTaxProvision module. The calculations then incorporate apportionment factors, modifications, and attributes input by the client to calculate the current and deferred state provision by entity and by jurisdiction. The resulting state provision reports allow the user to analyze the components of the current state provision, as well as compare the provision to the most recent state tax returns filed to ensure the most accurate provision possible in a short timeframe. In addition, clients can analyze deferred state tax balances by entity, by jurisdiction for issues such as valuation allowance considerations and state tax planning. All state provision amounts are incorporated into the worldwide provision amounts in the eTaxProvision module. These features are offered in eStateTaxProvision as part of the integrated suite of Tax Series.

eStateTaxProvision provides:

Accurate Calculations

• Calculates current and deferred provision at the federal, state, and foreign level
• Provides detail of the effective tax rate drivers
• Computes FIN 48 disclosure amounts by tracking uncertain tax positions
• Provides both simple and complex FIN 48 interest computations
• Calculates state income tax provision using either a blended marginal state tax rate approach by entity, or a more detailed state-by-state approach
• Re-measures deferred tax balances for all jurisdictions, based on future enacted tax rates for a span of up to ten years, and posts the resulting rate change adjustment to the deferred tax provision
• Calculates the currency translation adjustment on deferred tax balances resulting from foreign exchange rate fluctuations between periods
• Calculates permanent and temporary return-to-accrual adjustments
• Produces a tax basis balance sheet at the general ledger or summary level
• Aggregates deferred tax items on the footnote report based on user-defined footnote groupings
• Computes the effective tax rate for annual/quarterly tax periods to assist with interim reporting requirements under APB 28



Comprehensive, Customizable, User-Friendly Reports

• Details the calculation of current, deferred, and total tax provision
• Displays a period-over-period rollforward of gross and tax-effected deferred tax balance
• Provides a statutory rate reconciliation
• Provides a weighted average rate reconciliation
• Offers a footnote report with detail of the income tax provision by jurisdiction, aggregation of ending deferred tax balances by user-defined groupings, and a breakdown of current and non-current ending deferred tax balances
• Displays a tax basis balance sheet
• Provides a current liability rollforward report
• Produces HTML, Microsoft® Excel®, and Adobe® Acrobat® formatted reports



Efficient Processing

• Automates book-tax adjustments at the general ledger level or standardized chart level
• Grants users comprehensive import capability with built-in validation
• Contains efficient balance management feature that allows transfer of data between provision and compliance
• Provides user-definable workpapers
• Allows comprehensive activity tracking
• Provides a mechanism for the recording and reporting of current year activity, including true-up, audit, and purchase accounting
• Provides user sign-off and workpaper locking
• Allows for flexible multi-entity multi-jurisdiction calculations
• Grants global participant access to expedite the provision process
• Provides “what-if” capability using case management
• Integrates with our Web-based global data collection module to facilitate global provision reporting
• Integrates with the Tax Series compliance module so that compliance is substantially complete based on provision data
• Automates Return to Accrual reporting and analysis



Transparency and Enhanced Management Capability

• Allows users to enter trial balance and book-tax adjustment data at the general ledger level so that account numbers used in workpapers are synchronized with the provision system
• Permits general ledger level detail to be summarized into a financial consolidation level to ease reconciliation between provision and financial reporting systems
• Lets users collect general ledger level trial balances using our Web-based data collection module
• Provides a clear audit trail for all calculated balances, deferred tax balances, and true-up balances
• Supplies easy-to-use workpapers to make posting and reviewing of adjustments easy
• Allows users to navigate from workpapers to source level adjustments
• Provides user-defined balance types to track different types of provision adjustment
• Allows users to track tasks using a built-in task tracking tool to assist with internal controls in the provision process (SOX 404), including step-by-step preparation tasks, and preparer and reviewer sign-off
• Provides a repository to maintain supporting documentation