Key Takeaways
- TaxARC™ helped expand transaction-level review beyond primarily higher-dollar transactions.
- Nearly $20 million in over-accrued use tax and vendor-charged sales tax errors were identified in one year.
- Monthly review time decreased from approximately one week to one day.
- Greater visibility helped the tax team identify exceptions and vendor-charged tax trends.
- The streamlined process gave the company’s tax professionals more time to focus on analysis and strategic tax matters.
Client
A leading national restaurant chain with operations across multiple jurisdictions manages a significant volume of transactions requiring ongoing sales and use tax review. With tax activity spanning a large transaction population, the company needed an efficient way to identify potential tax errors while maintaining confidence in its indirect tax compliance and accrual processes.
Challenge
The company’s tax team had an established monthly process for reviewing use tax accruals and vendor-charged sales tax. However, the process was largely manual and focused primarily on higher-dollar transactions.
Each month, tax professionals spent approximately one week analyzing transactions for potential issues. The time required for the review limited how broadly the team could evaluate its transaction population and left less time for investigating exceptions, identifying trends, and addressing higher-value tax matters. The company wanted to expand its review coverage without adding significant time or resources to the month-end process.
Solution
DMA was engaged to implement our TaxARC™ indirect tax analytics solution to provide greater visibility into transaction-level tax activity and automate key aspects of the company’s review process. Using TaxARC™, the tax team was able to analyze a much broader transaction population rather than primarily focusing on manual reviews of higher-dollar items due to time constraints. The technology helped surface exceptions and potential errors for focused review, including over-accrued use tax and sales tax charged by vendors.
TaxARC™ also gave the team greater visibility into tax activity and vendor-charged tax trends across jurisdictions, making it easier to identify patterns and focus attention where further investigation was warranted. With the data analysis handled more efficiently, tax professionals were able to spend less time manually working through transactions and more time evaluating exceptions, understanding their underlying causes, and taking action.
Result
In a single year, the company identified nearly $20 million in over-accrued use tax and vendor-charged sales tax errors, creating a significant financial benefit for the organization. At the same time, the monthly review cycle was reduced from approximately one week to just one day.
The expanded review process provided:
- Greater visibility across the company’s transaction population
- Improved identification of tax exceptions and vendor-charged tax trends
- Increased accuracy and confidence in use tax accruals and indirect tax compliance
- More time for tax professionals to focus on analysis, exceptions, and other value-added activities
By combining broader transaction-level analysis with a more efficient review process, the company strengthened its tax controls while identifying significant financial value.
Why DMA?
DMA combines deep transaction tax expertise with purpose-built technology to help companies turn large volumes of tax data into actionable insights. The TaxARC™ software solution enables tax teams to move beyond time-intensive manual reviews by analyzing transaction-level activity, identifying exceptions, and providing greater visibility into potential tax risk. For this global restaurant brand, that combination helped transform a week-long monthly process into a more comprehensive one-day review—while identifying nearly $20 million in tax errors in a single year.
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