Turning your initial MDR assessment exercise into an efficient compliance process

20 March, 2020

Blika

Have you done your first assessment of MDR reportable arrangements? Now you need to develop a firm process and find a software solution for identifying potential arrangements that might be comprised by the MDR reporting on an ongoing basis.

Many multinational companies have analysed or started to analyse if they have arrangements that are reportable under the new MDR legislation. This has in many cases been a cumbersome and time-consuming process that has involved many stakeholders within the group and discussions with external advisers in different jurisdictions.

Irrespective of whether or not your group has identified many reportable transactions, you now need to consider and decide how you should manage the ongoing process of identifying, reviewing, documenting and filing potential reportable arrangements. In other words, you need to convert your first initial assessment exercise into a process that works on an ongoing basis.

In this respect, the basic standpoint is that you need to identify and review a substantial amount of transactions in order to find the, in some cases few, arrangements that actually should be reported by your group or by one or several external intermediaries. Furthermore, you should consider to make the process of identifying, reviewing and filing as efficient as possible.

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Due to the short timeline for filing (30 days), you may have difficulties managing the reporting in an ad hoc process using email.

In addition, it is risky to push down the compliance exercise to local subsidiaries, since they might not have a deep enough knowledge of tax and will need the possibility to continually engage with the central tax team in order to know what might be reportable. Furthermore, your central tax team should be fully aware of any transactions that could be reportable and should coordinate the reporting obligation.

It may be difficult to collect and understand what information should be disclosed to the tax authority without a solution that guides you through the information gathering process.

In the situation where a country requires you to file using XML, you need a tool that supports the conversion of data into XML. Using consultants for the conversion might be costly and difficult due to the tight deadlines that apply.

If you envisage filing in web format, you have to get the data presented to you in such a way that you can make the necessary input to the web form.

 

If you would like to know how Blika can support you on DAC6 and take part of demo of our solution- register here.