For over 20 years, WGL and PowerPlan have maintained a strong partnership based on mutual trust and respect. The robustness of this collaboration became clear in 2022 when WGL faced several challenges but was able to rely on PowerPlan for support. WGL’s Tax Director, Charles Mannix, expressed confidence in their long-standing relationship, stating, “I knew we had a problem, and, as many times in the past, I knew we could rely upon PowerPlan to focus on our situation and find a solution.”
PowerPlan offered a co-sourcing arrangement to assist WGL with immediate resource constraints. Both organizations collaborated to develop a long-term strategy, which included implementing PowerPlan’s Tax Fixed Assets (TFA) solution. This initiative aimed to help WGL reclaim tax depreciation while enhancing their deferred tax functions. “We expect tax rate changes in the next 12 months, and with TFA, we’re more than prepared to handle that challenge,” Mannix added.
Background
WGL is an energy provider that offers natural gas, electricity, and other energy services, including green power and carbon reduction. The company has a broad portfolio, including Washington Gas, WGL Energy, and Hampshire Gas.
Before adopting the TFA solution, WGL had utilized PowerTax since 2000, relying on PowerPlan for assistance with tax changes.
The Challenge
WGL’s tax department faced significant challenges, including a reduction in staff, an upcoming heavy regulatory schedule, and the retirement of key team members. With one third of the tax staff gone, the team struggled to manage PowerTax, risking data integrity and organizational efficiency. Additionally, the scarcity of tax experts made it even more difficult to cope with these challenges. Mannix noted that the regulatory calendar clearly necessitated a shift away from PowerTax to the cloud-based TFA.
Implementation
From the beginning, WGL and PowerPlan worked closely together to implement TFA. To address WGL’s immediate needs, PowerPlan’s team facilitated tax operations during the staffing shortage while ensuring the TFA implementation proceeded smoothly. “We worked with the WGL team from start to finish… the migration to TFA was seamless with incredible trust on both sides,” stated Kinav Patel, a Strategic Account Executive at PowerPlan. Key phases of the project incorporated data migration, system configuration, user training, and testing.
The Solution
The TFA solution has centralized WGL’s tax processes, providing real-time insights. The tax team now benefits from:
- Enhanced Efficiency: Automation of routine tasks has streamlined workflows and saved valuable time.
- Improved Data Accuracy: Reduced errors through better data validation and reconciliation processes have boosted confidence in tax reporting.
- Enhanced Decision Making: Quick access to accurate tax information facilitates informed decision-making.
- Reduced Cost: Automation has lowered overall enterprise costs.
- Mitigated Risk: Stronger controls and audit trails have enhanced compliance and lessened the risk of tax penalties.
Mannix acknowledged the improvements, stating, “Because we have an easy-to-use, fully functioning system, we can focus more on tax strategy and less on operational issues.”
After implementing TFA, PowerPlan continued to support WGL’s tax operations, proving to be cost-effective by eliminating the need for PowerTax upgrades and extensive external support over five years.
Future Outlook
As WGL adapts to changing tax regulations, PowerPlan will remain integral to their operations. WGL’s experience offers valuable insights for other companies looking to optimize their tax functions and harness new opportunities.