Weatherford is one of the largest multinational oilfield service companies providing innovative solutions, technology, and services to the oil and gas industry. Headquartered in Switzerland, the company operates in over 90 countries across a network of 800+ locations with approximately 30,000 employees.
For Weatherford, calculating use tax on fixed assets is a complex process.
- Will the asset be placed in service? Will it be rented out?
- Where will it be used?
- Is the job taxable or nontaxable
Tackling those questions is key to calculating and collecting use tax—yet answers typically are unknown at the time of purchase.
Leveraging Vertex Indirect Tax O Series, Weatherford built a fixed-asset use tax solution that applies real-time use tax rates and rules in terms of business processes for upstream transaction tax management. The team created a Vertex O Series call for rates/use tax calculation outside the usual Procure-to-Pay, Order-to-Cash business process. As a result, the tax team was able to evaluate an asset’s use tax position as soon as an asset utilization business decision triggered a use tax liability, initiating the process—and posting use tax to the general ledger if appropriate—on demand, mitigating potential exposure.
By improving use tax accuracy, the company estimates significant savings in audit penalties (along with related cash flow benefits) and a reduction in audit workload.