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【Case Study】Developing a global management foundation to accommodate India's complex accounting rules, tax laws, and e-invoicing while fostering collaboration with the Japan HQ/NIHONKEIEI TAX CO.

NIHONKEIEI TAX CO.

 

NIHONKEIEI TAX CO. is strengthening its support for corporate overseas expansion. The firm has established a new local entity in India and commenced outsourcing services such as accounting, taxation, and bookkeeping.　They have introduced the cloud-based accounting and ERP service called "GLASIAOUS" by Business Engineering (B-EN-G) as the service delivery platform for this expansion. This system also serves as the core business infrastructure for their newly established entity in India. NIHONKEIEI TAX CO. is achieving global management by adapting to India's intricate tax laws and electronic invoicing while ensuring seamless information coordination between India and Japan.

 

Before
  • With the establishment of the entity in India, there is a need for the development of a new core business system that complies with the local tax laws.
  • The tax laws, including Goods and Services Tax (GST), are complex.
  • It is difficult for Japanese companies to fully master the locally-used accounting software in India.
After
  • Adapting flexibly to India's specific accounting rules and tax laws.
  • Achieving smooth information coordination between India and Japan.
  • By utilizing the GLASIAOUS consortium as a marketing platform, prospective customers can be acquired.
Why GLASIAOUS
【Keywords】Adaptation to overseas specific business customs and tax laws/Electronic invoice implementation/Strengthening collaboration between overseas branches and the head office in Japan/Support for accurate management decision-making/Standardization of accounting tasks
Elimination of redundant data entry/Resolution of complex management/Establishment of a remote work system for outsourcing/Participation in consortium

GLASIAOUS is being utilized as the foundation for supporting businesses that have expanded into India. In addition, various accounting specialists and IT companies work together to support clients while jointly examining market needs and delivering the best products and services to the market through the "GLASIAOUS Consortium."

Interview

A cloud-enabled core system connecting the headquarters and the India branch
Flexibly adapts to the local accounting rules and tax laws
NIHON KEIEI Group
NIHONKEIEI TAX CO.
Totale Solution Department
Inernational  Manager
NIHON KEIEI（INDIA）
PRIVATE LIMITED
DirectorMr. Kunio Fujii
India has Unique business custom
Struggling with complex accounting rules and tax laws

At NIHONKEIEI TAX CO., we handle a wide range of cases, including corporate taxation, international taxation, business succession, and inheritance planning. Additionally, in recent years, we have been placing particular emphasis on supporting businesses expanding overseas。Furthermore, following the establishment of our existing subsidiary in the Philippines, in June 2021, we also set up our own group's office in India. We support the expatriate staff from Japan to assist with accounting tasks, providing practical support for both domestic and overseas expansion.
Mr. Kunio Fujii, Deputy Manager of the Overseas Team at the Total Solution Business Division of NIHONKEIEI TAX CO., speaks as follows about the difficulties faced in conducting business in India.
"For example, the Goods and Services Tax (GST), which corresponds to the consumption tax, has complex tax rates set for each item or service. Moreover, for transactions that cross state borders, they must be accounted for separately under both the state government and the central government, highlighting the presence of various accounting rules in India. Additionally, the tax laws themselves are designed with the assumption of electronic filing."
From these circumstances, it becomes essential to utilize systems to adapt to India's unique accounting rules, tax laws, and electronic filing requirements. In India, the ERP package known as "Tally" has become the de facto standard, and many Japanese companies that have expanded into India also use Tally. However, even this is not a straightforward task.
Mr. Fujii explains, "Tally is developed to align with India's business practices, so the presentation of the Balance Sheet (BS) and Profit and Loss Statement (PL) is significantly different from Japan's. Moreover, Tally hardly has the concept of account items. As a result, to share accounting information with the head office in Japan, there is a cumbersome process of manually categorizing Tally data and transferring it to monthly financial statements (MIS) on spreadsheets."

The evaluation highlights the system's compliance with tax laws and its excellent user-friendliness.　Expectations are also placed on the consortium as an opportunity for public relations.

As a solution to the aforementioned challenges, NIHONKEIEI TAX CO.  considered GLASIAOUS as an ERP system. When tasked with outsourcing accounting and tax processing, as well as bookkeeping for a certain Japanese corporate group that expanded into India, they proposed the implementation of GLASIAOUS. Furthermore, they decided to adopt GLASIAOUS for their own Indian subsidiary as well.
Mr. Fujii stated the reasons for selecting GLASIAOUS, "We appreciated its ability to individually address India's complex tax laws and electronic invoicing requirements. Additionally, we valued its standard support for multiple languages and currencies. The user interface is exceptionally user-friendly, making data entry efficient, which we believe will lead to streamlining our bookkeeping outsourcing services."
An additional benefit that sets GLASIAOUS apart from other ERPs is the existence of the "GLASIAOUS Consortium." This consortium brings together accounting firms and IT companies to collaborate on supporting clients while jointly examining market needs and delivering the best products and services to the market. The consortium aims to become the de facto standard for cloud-based international accounting services.
Mr. Fujii emphasized, "For instance, within the functional working group, there are serious discussions on solving operational challenges related to global accounting and taxation. The scheme of providing feedback on these results as new features contributes to GLASIAOUS's competitive edge."
Furthermore, Mr. Fujii mentioned that the GLASIAOUS Consortium also appears to be attractive as a platform to showcase their own business. He stated, "Our Indian subsidiary has just started, and to expand our business for the future, we need to actively raise awareness among influential Japanese companies. As part of such efforts, the opportunities to co-host events and deliver seminar speeches through the GLASIAOUS Consortium's activities are invaluable business opportunities for us."

Fully utilize GLASIAOUS both for their clients and for their own internal operations.　Achieve tax law compliance and efficient accounting processing.

The GLASIAOUS system was introduced for customer use by the Indian subsidiary and commenced operations in January 2022. For their own internal use, they are gradually transitioning from existing accounting software to GLASIAOUS and plan to complete the full migration by March 2023.
For the customer-facing GLASIAOUS system, it is fulfilling its initial purpose of fully handling outsourcing services such as accounting, taxation, and bookkeeping, just as planned.
Mr. Fujii explains, "Thanks to the support of B-EN-G, which provided us with standardized formats compatible with India's unique electronic invoicing and macros to automatically allocate appropriate account codes to input data for categorization, we were able to achieve a smooth implementation. Moving forward, we plan to expand the usage of GLASIAOUS, including functions like accounts receivable reconciliation and automatic electronic invoice delivery to our clients. Moreover, we see this as a stepping stone to pursue new consulting opportunities in areas such as global management and internal control management."
On the other hand, concerning the GLASIAOUS system introduced for their own internal use, Mr. Fujii expressed their intention to enhance integration with the ERP system on the Japanese side. They aim to achieve a division of labor, such as approving the financial statements conducted in India from the Japanese side, and further develop it as a foundation for global management.
Based on the results and feedback obtained from these efforts, NIHONKEIEI TAX CO. is further accelerating its activities within the GLASIAOUS Consortium. In fact, they have conducted over 10 web seminars in 202
"Thanks to everyone's support, we have had numerous attendees in our web seminars, and some have become repeat participants. By continuously pursuing these efforts diligently, we are steadily acquiring new leads (potential customers) and expanding our client base," Mr. Fujii explained.
NIHONKEIEI TAX CO. is poised to advance its business transformation and strengthen global business based on GLASIAOUS with the cooperation of the consortium and B-EN-G.

Client Information
NIHONKEIEI TAX CO.
https://nktax.or.jp/
Foundation：1967（Opend as a Hiramura Comprehensive Tax and Accounting Office.）
Business：Tax advisory services for companies, asset owners, hospitals, clinics, nursing care facilities, etc., tax and financial consulting, organizational restructuring, business succession, international taxation, trusts, asset rearrangement, and more.
Affiliated with the Kinki Certified Public Accountants Association and the Tokyo Certified Public Accountants Association, we are an independent tax accounting firm, leveraging one of Japan's largest scales. We provide comprehensive and top-level support for our clients' growth and development, including corporate taxation, international taxation, business succession, and inheritance planning. Our team of professionals excels in organizational restructuring and business succession strategies, enabling sustainable growth and development for companies and organizations.

 

 

 

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