Hello everyone. My name is Peter and I welcome you to PWC Taxbyte podcast.

Today I have in my virtual recording studio three colleagues and we're going to continue our discussions of the past episodes on tax technology and Pillar 2.

I have with me, Jorgen, already well known from the previous episodes, and Jorgen is leading

our global compliance network at PWC.

I also have WALIT and Bert.

Walit is a tax and accounting technology expert, and he has a particular focus on Pillar 2

and ERP implementations. Bert is an expert working on the interlink between Pillar 2 and tax technology.

So I think you have the right group of people to continue our discussions of the past sessions.

And in this fourth session of the mini-series,

we will be going deeper into the topic of having separate tax ledgers.

It's a question we receive quite often from our clients and not easy to answer.

So, Jorgh, I'm going to have to give you that task.

Could you start off with sharing some of your experiences with direct tax ledgers in

an ERP system?

Thanks, Peter, and happy to do so, and thanks for hosting us again this episode.

Let me start by briefly explaining what a tax ledger is and why organizations may consider this to then go into what

the typical benefits would be. As you will see, in many cases, this is mainly going to be a

cost-benefit discussion. So is the return on investment sufficient? So what is it a tax ledger?

As we've seen in our previous episodes, more and more multinational companies are implementing secondary ledgers in their ERP to support local gap accounting and reporting.

So they often have two ledgers in place, their group gap ledger and their statutory ledger. A third ledger for direct tax

specifically may make sense, but only if it would be more cost efficient than maintaining

a tax-based balance sheet outside your ERP. What typically drives a discussion on a tax ledger

...