Biocad switched to tax monitoring

2020: Automate income tax calculation

On September 27, 2021, the company SAP CIS announced that BIOCAD the first the Russian pharmaceutical of the companies switched to tax monitoring, and also automated the calculation of income tax. The project was implemented by experts from SAP Services CIS and the SAP Custom Development Center based on a number of solutions:, SAP SAP S/4HANA Tax Monitoring,. SAP BusinessObjects Automated collection information made it possible to significantly reduce the labor costs of preparing mandatory tax reporting. Updated internal control processes have reduced organizational management risks and increased data transparency.

When choosing a solution, we relied on the experience of similar projects of the SAP team, the predicted short implementation time was also important, which made it possible to see the benefits of tax monitoring in action in a short time. The transition to an updated work format and the development of an internal control system is one of the important steps in the issue of risk management and ensuring business sustainability. The initiative influenced the improvement of BIOCAD's image by the state and counterparties. And also positively affected the assessment of the Moody's credit agency as part of the process of assigning a primary corporate credit rating, "said Dmitry Gordeev, Deputy General Director for Finance and Supply Chain Management of BIOCAD.

Before the start of the project, NGO calculations and declarations were carried out manually, the process was extremely labor-intensive and complex. There were no preventive measures to identify possible errors in the calculation of tax, they were discovered already on the fact of publication of reports, because of this it was necessary to file adjustment declarations, the risk of fines and penalties increased. Given the complex structure of the location of production sites in special economic zones and the company's participation in various initiatives that provide certain tax benefits, BIOCAD tax department employees needed tools that would help simplify and accelerate communication with tax authorities.

The transition to tax monitoring started in mid-2020, the functionality of automatic calculation of income tax was launched in December. In May 2021, the publication data of consolidated and analytical registers for NGOs for the 1st quarter was completed in the showcase. The basic solution of the showcase is expanded in accordance with the specifics of tax accounting in the company, configured integration with the source system, additional analytical registers are implemented, forms of declarations and registers are adapted to maintain indicators in the context of several tax zones.

The updated system made it possible to establish online interaction and electronic document management with tax authorities, minimize the number of errors in calculating the tax base and deductions, significantly reduce the number of requests received from tax authorities, reduce fines and tax risks, as well as reduce the time for reporting and field inspections. Employees of the tax department can quickly consult with experts of tax authorities on the consequences of transactions, on complex or atypical operations and manage risks, based on the motivated opinion of the Federal Tax Service specialists. The convenient web interface of a show-window allows to use it as a reporting system to heads tax and financial departments and also as the tool for the analysis of tax indicators, audit and optimization of the reporting with adjacent divisions.

In the near future, the development of the functionality of the tax monitoring and income tax window is planned: additional registers will be introduced in the system, automated parallel accounting of R&D projects will be added, personal income tax and insurance premiums, transport and property taxes will be included in the functional volume of the window.

BIOCAD is growing rapidly, production facilities are being actively put into operation, this naturally affects the volume of document circulation and tax operations. The digital platform provides tax transparency and openness of business practices, allows you to control the quality of data, receive information about accruals, assess risks, and at the same time significantly saves time and simplifies communication with the Federal Tax Service. The system enriched the existing IT landscape and became an important element of the intelligent enterprise that is being built by BIOCAD based on SAP S/4HANA, "said Andrei Sharak, Director of Consulting and Support at SAP CIS.