Why Energy Tax Advisory Adds Value to Back-Office Outsourcing Clients
By Lynn Loden
As the oil and gas industry continues to maintain its sharp focus on reducing or maintaining current cost structures—even as oil prices continue to recover from a four-year slump—oil and gas outsourcing has proven to be an effective and reliable service that offers a host of benefits, including predictable cost stream, increased quality of transactional and financial reporting, reduced headcount and improved efficiency, to name a few.
Simply put: outsourcing is a proactive way to derive a higher output from a company’s assets. It also defends against risks and creates more potential for success.
In addition to outsourcing, Opportune’s Energy Tax Advisory practice offers integrated solutions for outsourcing clients such as tax compliance, accounting for income taxes under ASC 740, and critical tax planning for energy companies in ever-changing markets and structures. Integrating tax with Opportune’s outsourcing service puts oil and gas consulting firms at a competitive advantage over audit firms, including the Big 4, as outsourcing firms have access to and are deep into the data to prepare a tax return or income tax provision and recognize tax planning opportunities on a real-time basis, rather than after the audit is being performed. Additionally, Opportune Energy Tax Advisory can provide integrated accounting for income tax and tax compliance services that avoid attest-related scope limitations.
Among the various tax solutions Opportune Energy Tax Advisory can provide to outsourcing clients include:
- Federal and state income tax return preparation
- Foreign withholding analysis, form preparation and payments to tax authorities
- State apportionment determinations and computations
- Estimated tax payment projections
- Book and tax depreciation, depletion and amortization reconciliations
- Oil and gas property management (IRC Section 614)
- Cost and percentage depletion calculations
- Original issue account determinations and computations
- Tax representation on federal and state income tax audits
- Work with legal counsel on transaction design and structuring
- Targeted capital account/tax distribution modeling
- Debt/Equity and conversion effect tax analysis
- Intangible drilling cost (IDC) identification and optimization
Financial Reporting Under ASC 740
- Tax provision preparation under ASC 740 for corporate entities and for partnerships with entity level income taxes
- Preparation of management documentation for external audit support and responses to SEC comments for public and private entities
Opportune Energy Tax Advisory has professionals who have worked in industry as well as “Big 4” firms and can give your company practical, yet sophisticated tax assistance. Being integrated with the accounting outsourcing process will provide synergies that will lead to cost savings, as well as risk mitigation.
About the Author:
Lynn Loden is a Managing Director in charge of Transaction Services and Energy Tax Advisory for Opportune. He has over 30 years of corporate tax and accounting experience with Big Five public accounting and similar professional services firms.