Goal setting and performance measures - by tax professionals in Fortune 500 companies

Tax Executive, The, Nov, 1998 by Barry P. Arlinghaus

Table XXI
Formal Work Plan for Professionals by Tax Department Organization

                                                    % Who
Organization of                                   Establish
Tax Department                      Respondents   Work Plan

Along functional lines
 (compliance, planning, etc.)           20          55.0
By type of tax (federal, state,
 provincial, etc.)                      46          34.8
Combination of functional
 and type of tax                        94          55.1
Along similar lines to corporate
 organization (industry, division
 subsidiaries, etc.)                     9          22.2

With the exception of small departments (5 or fewer tax professionals), the size of the department has little influence on whether formal work plans are established. The number of firms with formal work plans by size of tax staff is shown in Table XXII.

Table XXII
Formal Work Plan for Professionals by Number of Professional Staff

                                              % Who
Number of Tax Professionals                 Establish
at Headquarters               Respondents   Work Plan

0 to 5                            18          27.8
6 to 10                           40          47.5
11 to 15                          41          48.8
16 to 20                          28          53.6
21 to 50                          52          46.2
51 to 100                          5          40.0

One hundred and thirty-nine of 189 respondents indicated that either the senior tax person or a functional manager, if delegated, sets formal performance goals for each tax department professional. As shown in Table XXIII, firms organized by type of tax are less likely to set formal performance goals than are firms organized in other ways.

Table XXIII
Performance Goals for Professionals by Tax Department Organization

                                                    % Who Set
Organization of                                    Performance
Tax Department Goals                 Respondents      Goals

Along functional lines
 (compliance, planning, etc.)            20           90.0
By type of tax (federal, state,
 provincial, etc.)                       47           59.6
Combination of functional
 and type of tax                         96           77.1
Along similar lines to
 corporate organization (industry,
 division, subsidiaries, etc.)           10           80.0

With the exception of small departments, the size of the department has relatively little effect on whether formal performance goals are set for tax professionals. The number of firms where formal goals are set by size of tax staff is shown in Table XXIV.

Table XXIV Performance Goals for Tax Professionals by Number of Professional Staff

                                              % Who
Number of Tax Professionals                 Establish
at Headquarters               Respondents     Goals

0 to 5                            19          63.2
6 to 10                           42          80.9
11 to 15                          42          73.8
16 to 20                          28          71.4
21 to 50                          52          71.2
51 to 100                          6          83.3