How AI-powered ERP systems transform tax departments

ERP systems: The key to successful tax

ERP systems are integrated software platforms that facilitate core business processes, including accounting, procurement, project management, and supply chain operations.

They give tax teams a single database for all the information across each department, even automating new data entry and reconciliation for easy access to real-time, accurate information. This ability allows them to quickly respond to constant changes of all sizes — from sales or expense adjustments to new, business-shaping regulations.

Given their clear value, almost every organization uses at least one ERP system; some larger organizations even deploy one for every corporate department based on their needs.

However, using multiple disjointed ERP systems at once can quickly create headaches. Inconsistent data storage methods can drastically slow down analyses and business-wide processes. Tax teams may also lack a single view of the customer, leading to frustrating experiences and reputational damage.

Integrating several ERP systems across your organization is another challenge, given the costly technical challenges and updates you must overcome. But it’s well worth doing — and the right partner can help take the complexity out of the process.

AI and GenAI: Enabling a new era of corporate tax

As stated in the Thomson Reuters Future of Professionals Report 2024, the data management capabilities of AI and GenAI are set to revolutionize corporate tax functions as we know them.

AI is unparalleled in its ability to automatically analyze large datasets and spot patterns within them to predict future outcomes and risks. Many AI tools go one step further, monitoring and installing continuous regulatory updates to ensure compliance requirements are always met.

The Indirect Tax Report 2024 from Thomson Reuters Institute adds to this. It suggests that the real-time information corporate tax departments gain from AI analytics, coupled with GenAI’s ability to summarize findings, can transform tax departments into pillars of strategic wisdom.

For example, predictive analytics allow for more accurate tax scenarios that strengthen crucial business decisions. Not only that, but the efficiency of AI frees up tax teams to work on other value-add areas that save costs and drive business growth.

The benefits of AI-driven ERP systems

On their own, AI and ERP systems are highly effective tools that can save countless hours and costs for any organization. But together, they can completely transform how the organization works — bringing the following benefits for corporate tax functions:

• Efficient analyses of consistent datasets. Automated data mapping and cleansing allows data to be easily integrated and harmonized across sources for quicker analysis.
• Easy compliance and full tax benefits. Intelligent data categorization keeps financial data aligned with real-time tax regulations, ensuring compliance and minimizing tax spend.
• Faster reports and anomaly identification. Automatically cross-referencing financial records across the business reduces lengthy manual labor, letting the business act faster.
• Fewer penalties. Real-time tax determination as an automatic process means timely submissions and a reduced risk of penalties.
• Risk oversight. Compliance and regulation monitoring makes it easy to identify compliance risks and mitigation strategies.

What does the future look like for corporate tax?

Most corporate tax departments are still in the process of integrating AI — especially GenAI — into ERP systems. But once AI-driven ERP systems become the status quo, tax departments will be able to reach new frontiers of efficiency, accuracy, and compliance. Many will even act as strategic partners who lead the way to smarter business decisions. 

Want to learn more? Get in touch with one of our solutions consultants or download the new Thomson Reuters Institute report, “2024 generative AI in tax firms.”