A majority of companies do not have a formal, documented tax risk management strategy in place, according to a newly released survey.
Sixty percent of the 546 respondents surveyed by the Tax Governance Institute said their companies lack such a strategy. The same percentage acknowledged that the assessment and management of tax risk has become a greater priority for corporate leadership during the past 12 months.
Only 41 percent of the survey respondents said they are "very satisfied" that their organizations' tax positions are consistent with management's tolerance for tax risk. Enhanced regulatory pressures for greater transparency in tax reporting were cited as the greatest challenge that companies face in the next two years.
"It's heartening to see that enterprise tax risk is rising on the radar screens of U.S. business management, but it's clear from the survey results that more companies need to devote attention to implement policies to manage their tax risk," said Hank Gutman, director of the Tax Governance Institute and a principal in KPMG's Washington national tax practice, in a statement.
KPMG released a separate survey that found 51 percent of the 435 executives it polled globally want their organization's risk and controls management to assume a more strategic focus and become more effective for the company. Twenty-nine percent of the survey respondents expect their organizations to significantly increase their risk-and-control investments and resources, while 55 percent anticipate a slight increase.
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