Taste of Taxation

Till two weeks ago, I could never image myself working on a taxation project. I thought taxation was a necessary evil, something corporations cannot avoid; there was no creativity involved in the work. However, meeting my manager completely changed my view on taxation.

My manager has spent her last 20 years working in taxation field (both public and private sectors), and has great passion for her work. She sees taxation as a constantly changing field. Thus, finding the best practice in taxation never ends. Given the Financial Management Associate program goal is to provide us an overall understanding of all 6 Citi corporate finance functions, my manger started our conversation with stories of tax involvement in corporate entity spin off process and M&A project.

My project specifically involves the 52 billion dollars Deferred Tax Assets that Citi has on its balance sheet. Recent financial service industry regulation changes require banks to have more capital on its balance sheet. Traditionally deferred tax assets were treated as part of bank’s capital. However, under Basel rules, only 14 billion out of the 52 billion DTA that Citi has can be classified as its capital in Basel calculation because of the contingency nature of tax assets. This makes trueing up tax balance from legal entities to business units an urgent task.

Besides working on my taxation project, I also gain insides of Citi’s business operation as the summer speaker series and leadership training continues through the summer. Earlier this week, Prof Scott Snook from Harvard Business School came to Citi talking about finding a sweet spot (amount what a person’s good at, other’s appreciation and personal passion) as an import factor of becoming an effective leader. To ensure I can learn as much as possible from the internship experience, my manager also includes me to other business meeting outside of my project.