Companies Look Inward to Cybersecurity Liabilities

March 2017

While tax executives are mulling over how they will need to shift tax planning strategies to accommodate domestic and international change, cybersecurity issues remain a critical business concern. With high-profile cyber-attacks on organizations ranging from the Democratic National Committee to Dropbox to Yahoo! to the IRS itself taking place in 2016, executives across all sectors are looking to their own cybersecurity as a potential risk. And tax executives are no different. Furthermore, as the BEPS country-by-country reporting draws near, businesses face obligations to securely transfer sensitive tax data.

When asked about their primary concern related to cybersecurity, 40 percent of tax executives point to company vulnerability, and 31 percent cite internal controls and data protection policies. The cost of recovery from a cyber-attack was cited by 16 percent, followed by complying with global information security regulations (9 percent), IRS vulnerability (4 percent) and obtaining cyber insurance (1 percent).

“Cybersecurity isn’t just an IT issue—it’s an everyone issue, from the board of directors to the most junior employee. Tax executives are no exception: They deal with sensitive financial and transactional data that, in the hands of a sophisticated hacker, is the proverbial golden goose. Moreover, tax professionals are increasingly relying on tax and accounting software, which can serve as a gateway to the broader corporate network. As reporting and data demands increase, the more vulnerable all stakeholders touching that data are to attack.” – Gregg Garrett