Tax odyssey 2001
2 Oct 08
This article was first published in CA Magazine’s predecessor, The Accountant’s Magazine, in September 1985. You can read Donald Drysdale’s take on the likely life of a tax practitioner in 2025 in a new series, starting in the October 2008 issue of CA Magazine.
by Donald Drysdale CA
Henry felt isolated.
Since his secretary had left 18 months ago he had missed the personal contact – the day-to-day chit-chat which had seemed so little at the time, but meant so much. He consoled himself that she had been near 50 and would have had to retire soon anyway. She had been spared the choice between re-training and redundancy.
Henry thought about this as he half-absorbed the 7.30 am news on channel 12. Marge had not come down for breakfast yet so he flicked the remote control to "Office" and tapped in his security code and password.
¬
As he finished his coffee he quickly scanned the screen, glancing through the summary of incoming mall awaiting him at the office. There was yet another letter about the Royal-Midland Bank case and he called it up. The wall-mounted fIat-screen colour TV in the kitchen was every bit as clear as the office monitor, and it was always useful to see what was there before he left home.
Still a few minutes ahead of schedule, Henry had time to log on to his personal client-news file. This gave him the Prestext summary of all newspaper, radio and TV reports which had mentioned either tax developments or his own major clients within the past 24 hours. Following his brief holiday there was news for three days plus the weekend still unread. He keyed Instructions rapidly on the remote, deleting most of the items but saving The Times Law Report on the Hillsborough case to study later.
Because of the Prestext parameters he had set, a current valuation of his share portfolio appeared as usual at the end. With BT-IBM at Ecu7.89 after five bonus issues, he felt his resolve to keep his BT shares 16 years ago had been one of his better long-term investment decisions. Apart, that is, from his conscious attempts to keep abreast of "IT" developments.
The warble of the phone brought him back to the present. It was Marge's mother, in a state about something as usual. Thank goodness the multi-line phone system was now standard, else mother-in-law's endless calls would stop him logging on to the office. Or perhaps not, he mused: the office calls might have stopped mother-in-law.
"Goodbye, darling!" Henry called up as he left the house, but Marge was still on the phone.
At the office
Henry's office desk was clear and the new Desk-Term stood gleaming on the desk-height trolley beside his chair. The fifth-generation micros of the early '90s now looked prehistoric by comparison. As he logged on, Henry thought about colleagues who had resisted the advance of IT. Most of them had "gone out" in the merger-mania of 1992-93. Coping with the relentless pressures of tax practice he sometimes envied their now humdrum jobs or early retirement.
The tax department, of course, had not escaped the scourge of computerisation. In fact Henry's department had all but disappeared! Computational work had been the growth area of the '60s, '70s and ‘80s. But failure to recognise the potential of tax software had ruined many a smaller practice. This had caused a major re-think by tax departments in the large firms.
The market for personal tax services had shrunk following the Self Assessment Act 1989 and the simplifying steps taken by Younger's Government in the mid '90s. These had also brought with them the need for the tax department to work a six-day week from April through to August, not a wholly popular arrangement. Marge had been furious. The department still retained some involvement in the audit process, but most of the tax work was now well within the capabilities of software available to the audit team, and in many cases to the client.
Henry read through his incoming mall on the monitor, keying instructions to reply, delete, forward or hold as appropriate. Twenty or thirty items had to be acknow¬ledged, and he selected appropriate stan¬dard responses from file. This machine was reacting much more quickly than his old hard disk micro, and his typing speed was again becoming a constraint in deal¬ing with routine duties such as this.
Two clearances and three other Revenue letters were of general interest, so he marked them "For information" and copied them instantly to all other tax partners and managers in the UK firm, including the national Tax Research Office. Nine letters were requesting technical opinions, and he put these on "hold" to consider later in the day. His firm's reputation was built on speed as well as quality, and it looked like being hard day.
Already the phone had started its daily stream of interruptions. This was one problem which information technology had not solved. Indeed, it had made it worse. As the volume of compliance work had reduced and the importance of high-¬level consultancy advice had increased, so it had become desirable for senior tax specialists to be readily available by phone at all times. It had been proposed that the international tax sections would carry this further by working in shifts around the clock. So far this had been restricted to London office, but it worried Henry. Marge had said that it worried her too. Life was bad enough without that.
The shrill tone of the bleeper on his wrist-watch reminded him that he had not checked his diary appointments for the day. On the Desk-Term monitor, he looked quickly over the list. It reminded him to send out a report on Hong Kong royalties, to lunch with the solicitors Rother & Hythe, and to make a conference call to New York at 4 pm. In the evening he was to give a talk to a local trade association – luckily he had prepared some rough notes for that last night. He sent these up to the secretarial support department for typing.
Human contact
At 9.30 am Henry joined the daily departmental meeting. This was always useful, and sometimes his only human contact during the day. On some days he didn't even see the mail man now that so few clients used "hard copy mail".
The others were all at the meeting when he arrived – Jim and Erik, the other inter¬national tax specialists; Steve, Shirley and Tom of the legal section, dealing largely with contentious hearings and VAT tribu¬nals; four from tax compliance and finan¬cial services; three from software support and expert systems development; and, of course, the three trainees.
As he returned to his room after the discussion on technical tax matters over coffee, Henry thought back to the depart¬ment as it had been before. Nearly thirty people in all had worked on tax at one stage. With only sixteen now, the fees were higher – and that was in real terms after adjusting for inflation and the adoption of the Ecu. Was it foresight, or simply luck, that had made them realise where the new growth would be? The demand now was for tax work which required the skills of negotiation and advocacy, and for work which needed judgment too fine or specialised for the most powerful of today's computers.
Using Hong Kong for the receipt of royalties was a new game since the 1997 Extension of Rights Treaty. It was still difficult to know which of China's double tax treaties applied to the territory. Henry ran off a double-spaced draft of the train¬ee's report on his silent, high-speed, desk¬top laser printer, and then set about reviewing it thoroughly and scribbling amendments on the draft. He logged on to the InterTax database in the US to check current tax rates in various countries and the latest status of all the Chinese tax treaties. There was a recent statement by the Australian tax authorities which suggested a new approach to the problem. He returned to the report with the Desk-Term in edit mode, added a new paragraph on the third last page, and made a few other amendments before queuing the report for recording and filing prior to transmission. Then he keyed the time spent direct to the client's account.
Giving advice
A clear hour before lunch allowed Henry to study three of the morning’s requests for advice. Two needed written replies and he dictated these to his Desk-Term, using the wide-range radio mike so that his hands were free to key into the clients' files and to access various remote databases. As usual, the firm’s own Tax Research Database was particularly helpful because it contained data not available elsewhere. The voice-text transcription worked perfectly, and his replies were instantly availa¬ble to view on the monitor. He copied one to Erik's terminal in the next room, with a request that he give it a quick once-over.
The third request was best dealt with by a teIe-voice call to the client, who had been on-line yesterday accessing the EuroTax expert system which Henry himself had helped to create. The system was giving an "Insufficient Data" response to a query relating to French debt/equity ratios, and the program appeared to have reached the limits of its experience in that area. By tracing back through the screen images recorded by the system log, Henry was able to explain to the client (and show him on the tele-screen) another logic route which had not been fully explored. If property investigated, an occurrence such as this extended the capability of the EuroTax system, which was already being used to teach the trainees about European taxes.
Lunch with Rother & Hythe was the usual jolly affair, with talk of golf and football. At least some things don't change, thought Henry. Mind you, with most partners now retiring at 50 the reminiscences didn't seem to go quite so far back as they used to.
Calling New York
The conference call to New York was not quite what Henry had expected. Tax prob¬lems never are. It was a teIe-voice discus¬sion with three lawyers in New York, a land agent in London, an oil tycoon from Galveston and his property-investment partner in Los Angeles. Henry windowed the screen on his Desk-Term so that he could see separate images of all the participants. They were able to talk as though they were all sitting together in one room.
Henry could not resist the temptation to adjust the screen windows so as to zoom in closer on Los Angeles, who was young, female and very attractive. He had to remain outwardly cool, however, because he was also "on camera". Advice was needed on a UK property investment deal which made the Duchy of Cornwall look like a suburban garden. Henry used his auxiliary monitor to look up the new double tax treaty, and a window on the same screen to refer simultaneously to the recent amendments to the Land Develop¬ment Act 1991. Los Angeles went away happy, while Henry hoped that their next meeting would be just as electronic but in a different way.
Six problems from the morning's mail had not been dealt with. Henry was relieved to find that four had been looked at already by the trainees and their notes were of immediate help to him when he called the items up on his monitor. All but one were major exercises which had to be carried forward, and he spoke briefly with Jim and one of the trainees to ensure that progress would be made while he was at meetings with the Revenue for most of tomorrow. He sent out one reply, and the letter which Erik had approved, then reviewed quickly the state of the compliance work in the department. The ability to monitor progress and review deadlines by computer search was a great boon.
One hour to go
One hour left to prepare for a talk on European farming taxes was about par for the course. Henry put his Desk-Term on to auto-answer to direct calls to the trainees' room, keyed into the DirEnquiry database to get the number of the conference organiser, and called him to confirm the type of projector and terminal available. With auto-dial even an old-fashioned phone call seemed easier than it used to be. Next he called up on the monitor the brief tax examples which he had keyed in at home last night. He adjusted the parameters, ¬then sent the examples to the acetate colour printer in the secretarial support department. The overhead slides were on his desk five minutes later.
Henry checked that the Euro-Farm expert system was on line. It might be useful to log on to this during the talk, but of course he would show only the "public" bits of it. The firm had a significant lead in this ¬subject and were releasing the system in stages so that they retained their edge for as long as possible.
Before leaving the office Henry logged on to FarmLex in Luxemburg to check some facts about French farm subsidies and Italian import restrictions. He incorporated these details in his draft speaking notes, then printed them in double-sided bold type on his laser printer as he put on his coat. As he logged off his Desk-Term it reminded him to key in his chargeable hours for the afternoon and displayed a summary of the next day’s appointments.
The talk was well received. Thank goodness there was still a place for the personal touch! And the dinner was excellent. Late home again, but it bad been a good day and, for once, a sociable one. As he slipped into bed beside the sleeping Marge he wondered why she didn’t get a bit more excited about IT.
As an electronic mail enthusiast Donald Drysdale subscribes personally to Prestel, Micronet, Packet Switch Stream and Telecom Gold in the UK and to Compuserve and People Link in the US. In between times he works as a tax partner in KMG Thomson McLintock's Glasgow office and is a member of the Institute's Taxation Practices Committee. He sits on KMG Thomson McLintock’s national steering committee on information technology matters and is responsible for planning the computerisation of tax work throughout the firm's UK offices. His middle name is not Henry.