How Board Member Involvement Impacts Tax Risk

Join BDO's Dan Newton in discussion with Nathan Goldman, Ph.D., assistant professor of accounting at North Carolina State University, and co-author of a recently released research study Board Risk Oversight and Corporate Tax-Planning Practices.

Key Takeaways

• When board members get involved in understanding the tax strategy and tax risk of the company, corporate tax burdens go down

• Companies disclosure risk oversight practice typically have a more robust oversight process

• Research indicates that oversight really was focused on permanent book to tax differences more so than temporary differences so would encourage boards to be inquisitive as to both in practice

• Proactive tax planning oversight generally may result in companies having more favorable impacts on lower tax uncertainty reserves

• ERM Frameworks help companies identify their risk appetite and risk tolerance and such an exercise could and should extend to tax risks