Here’s the third and final part of my interview with Jason Rinsky, SVP of corporate taxation with defense systems giant DRS Technologies (the first part is here and the second is here). Starting in 2006, Rinsky led a technology implementation that integrated large areas of the firm’s tax processes, yielding significant efficiencies. Here he talks about users’ response to the new software.

Cummings: Can you describe in basic terms what the new system does?

Rinsky: What our new system does is that it takes information from the underlying trial balances and automates a series of tax-specific schedules, and then the data gets loaded into the tax provision application. Simultaneously, it takes the underlying trial balance information and populates a tax return, and then, upon our completion of the tax provision, it moves the book-tax differences from the tax provision into the tax return.

At the same time, it monitors our state tax rates and allows us to incorporate any changes in our legal structure so that we’re able to see financial statement information as well as what the cash tax payment implications are.

Cummings: What was the user reaction?

Rinsky: They have all embraced the technology and learned the different software applications. We’ve tasked them all with responsibility for knowing and understanding the software as well as the vendor understands it, and we’ve challenged them to come up with creative and different ways to utilize the systems or to interconnect the software that the vendors haven’t contemplated. From the standpoint of retaining tax professionals, we have to motivate people, and one of the ways to motivate them is to ask them to come up with better ways to get the job done more efficiently and to meet all of the different challenges that we face today as a tax department.

Cummings: Was there a particular experience that crystallized in your mind the success of the project?

Rinsky: In late 2008, as a result of the acquisition [of DRS by Italian defense giant Finmeccanica S.p.A.] and the implementation of IFRS, and in addition to the cultural challenges associated with an acquisition of that size from a tax standpoint, we were put into the unique position of now having to file two very challenging tax returns. For us, that was really the first time that we said “this technology solution has to work,” as opposed to “we want it to work.”

We couldn’t spend 12 to 14 months to file the returns because we would have missed our deadline, and we certainly didn’t want to take shortcuts and do things in a fashion that was going to impair quality. Also, we wanted to respect the quality of life of the people who work within our company because we always want to be able to motivate and retain talent.

So the value associated with the technology really crystallized when we were able to get our first tax return done within approximately a month and a half of our year-end following the provision. We had to continue to refine it from there, but this gave us the confidence level that we would be able to get that second return done just as quickly. We were able to complete the returns in the same time period that it used to take to do one, with high quality and with respect for the quality of life of our professionals. The technology allowed us to meet the challenges in a way that, when we first started developing the idea, we didn’t even realize was possible. ###