IRDG Seminar on R&D T ax Credits The Audit Process Brian Walsh - - PowerPoint PPT Presentation
IRDG Seminar on R&D T ax Credits The Audit Process Brian Walsh Quality & Technical Manager FMC Ireland Contents FMC Corporation & FMC Ireland Overview R&D Projects types and details Technical Assessment & Financial
Quality & Technical Manager – FMC Ireland
FMC Corporation & FMC Ireland Overview R&D Projects – types and details Technical Assessment & Financial Audit Timeline Audit Process Key Learning's
2
3 9/4/2014
$1.0B
Product Lines
Soda ash Lithium
4
FMC Health and Nutrition FMC Minerals FMC Agricultural Solutions
$2.2B
Product Lines
Herbicides Fungicides Insecticides
$0.8B
Product Lines
Microcrystalline cellulose Alginates Carrageenan Pectin Omega 3 Natural Colours
Rockland, ME
Manufacturing
Bangalore, India
Sales & Laboratory
Singapore
Sales, Laboratories
Kings Island, Tasmania
Manufacturing
Manila, Philippines
Customer Service
Cebu, Philippines
Manufacturing, Blending
Moscow, Russia
Sales & Laboratory
Shanghai, China
Sales & Laboratories
Istanbul, Turkey
Sales & Laboratories
Brussels, Belgium
Sales, Laboratories & Marketing
Sandvika, Norway
Laboratories
Iceland
Seaweed Drying
Cork, Ireland
Manufacturing
Pace del Mela, Italy
Manufacturing
Puerto Montt, Chile
Manufacturing
Campinas, Brazil
Sales, Laboratories
Mexico City, Mexico
Sales, Laboratories
Newark, DE
Manufacturing
Ewing, NJ
Laboratories
Philadelphia, PA
Sales & Marketing
Santiago, Chile
Manufacturing, Blending & Laboratory
Girvan, Scotland
Blending
Burton-On-Trent, UK
Sales, Laboratories & Marketing
Haugesund, Norway
Manufacturing
Jakarta, Indonesia
Sales
Guangzhou, China
Blending & Laboratory
5
6
7
One of the longest established industries in Little Island
Built in 1978 with 5,500T capacity to serve European market 2010 expansion increased capacity to 30,000T – provides product to worldwide market Highly automated process with 82 full time employees Manufacturing Regional Customer Service Regional finance
8
Product Uses
Colloidal Avicel Grades AcDiSol Avicel PH Grades
Binder and compression aid for pharmaceutical tablets Suspension aid in pharmaceutical liquids, creams & food products Disintegration aid in Pharmaceutical Tablets
Dicing Pulp Re-slurry & pH adjust Powder Storage Packaging Warehouse
Acid Water
Hydrolysis Reaction Quench Tank Rotary Vacuum Filter Spray Dryer Palletization
10
11
But we don’t do any R&D activity…..
Activity must be 1. Systematic, investigative or experimental……yes, we carry out a lot of activities like this 2. In a field of science or technology…….yes, our activities cover the areas of chemical, mechanical & material engineering 3. Basic research - no; applied research - probably not; or experimental development- yes 4. Seek to achieve scientific or technological advancement…….yes, some projects seek advances in this area…..may not necessarily work but at outset seek to 5. Involve the resolution of scientific or technological uncertainty…….yes, projects have varying degrees of uncertainty at outset
So in fact we do carry out R&D activity……mainly in the area of experimental development
12
Title Description Status Low Cost Fluid Bed Dryer Novacel Grade Product
Investigate the capability of using a modified fluid bed drying and grinder process to produce a binder grade microcrystalline cellulose which met appropriate regulatory requirements Complete
Addition of 3rd Spray Dryer
Integration of a new spray dryer and feed system utilizing upgraded technology to allow production of higher volumes of pharmaceutical and food grade Colloidal Avicel and higher volumes of Avicel PH product in Ireland at previously undemonstrated rates Ongoing
Filter B
Design, install and commission a filter to allow higher volumes
enlarged filtration area with existing filtration components. The filter is the first of it’s kind in the world by virtue of the nature of the design, size and materials used. Ongoing
13
Integration of a new spray dryer and feed system utilizing upgraded technology to allow production
PH product in Ireland at previously undemonstrated Colloidal Avicel rates Field of Science & Technology
Methods Used
For details contact brian.walsh@fmc.com
Scientific & Technological Objectives
For details contact brian.walsh@fmc.com
Scientific & Technological Advancement
For details contact brian.walsh@fmc.com
14
Integration of a new spray dryer and feed system utilizing upgraded technology to allow production
PH product in Ireland at previously undemonstrated Colloidal Avicel rates Scientific & Technological Advancement (continued)
For details contact brian.walsh@fmc.com
Scientific & Technological Uncertainty
For details contact brian.walsh@fmc.com
15
16
Q1 2009 Filter B project kicked off Q2 2010 Project stopped 2009 – 2010 Various trials May 2010 Commissioning & initial trials of dryer 2014 3rd spray dryer and Filter B project ongoing Q4 2008 3rd Spray dryer project kicked off Jan 2009 FBD product project kicked off Q1 2011 Filter B installed Dryer Filter FBD R&D Tax Credit claim submitted end of 2010/2011/2012 Financial & Technical Audit Process Now Revenue formal response pending Q4 11 FMC requested revenue for audit Q4 13 Financial audit & Technical Assessment Q3 13 Technical expert confirmed Q2 14 Follow up visit by Revenue – happy with financials Q1 14 Verbal indication that Technical Report is OK
17
18
Financial (2 days)
end – by KPMG on FMC’s behalf
report prepared and retained for audit
by two Revenue employees during Q4 2013 audit
check some records relevant to above information – 1 day
Technical (2 days)
prepared before claim submission on each project – prepared by FMC in conjunction with KPMG
by KPMG in advance of audit
advance of audit containing all relevant technical information
Technical Assessment & Financial Audit
project
each project
19
Eligible work
– think critically about what you do – it might be R&D
Process
– was managed retrospectively initially – now have a simple process in place to better manage R&D in a structure way – R&D engineer, R&D project procedure – structure your process so as to meet the requirements – e.g. plans, reports, cost records, time records, etc. – Need to be able to demonstrate R&D activity on an ongoing basis over the life of the project
Success vs. Failure
– your project need not necessarily be successful –
20
Value
– it’s worth the effort
Going Forward
– New possible R&D projects underway
21