Data analysis for VAT and GST

Business challenge

Data analyses of various market players are generally standard analyses that are generated by a data dump from SAP. Extracting data from a SAP environment is often not possible due to lack of the proper authorization. Moreover, the extraction of data is limited to a specific number of document numbers per extraction. This requires the same extraction to be executed over 30 times when an extensive amount of data is to be retrieved.

Retrieving data in multiple steps brings the risk of the format of the data not always being identical. As a result, there are no unequivocal results available and many manual adjustments are necessary.

In the case of extensive data, SAP often breaks off the analysis, because runtime limits are exceeded. In addition, due to restriction of the size of reports in SAP, created data files cannot always be copied to a pc.

Solely standard analyses are possible, which does not sufficiently take into account the complexity of business models and specific risk domains.

Best practice data analytics

The risk domains should be salient. Knowledge for enabling fully automated VAT determination and building an integrated Tax Control Framework is crucial in data selection. Besides that it is important that only VAT relevant data is retrieved that is necessary for this analysis. Providers of data analysis use for example third party software tools, so the data can be extracted from SAP in a uniform manner.

With this, problems regarding performance, format of reports and interpretation of data could belong to the past and guarantees the quality and integrity of data by means of:

Written by Richard Cornelisse, one of the articles published on Global Indirect Tax Management