The Commonwealth Bank of Australia (CBA) has disclosed settling a dispute with the Australian Taxation Office (ATO) over research and development (R&D) tax claims. CBA told shareholders Monday morning that it withdrew its challenge of the matters at the Administrative Appeals Tribunal (AAT) against the ATO and Innovation and Science Australia (ISA). The proceedings were related to the eligibility of R&D tax claims the bank made for the 2012-13 financial year, specifically around the program to modernise its core banking infrastructure. "Under the agreement terms, CBA has agreed to withdraw from all current proceedings with the ATO and Innovation and Science Australia before the Administrative Appeals Tribunal in respect of the eligibility of R&D claims that were made for the years ended 30 June 2012 and 30 June 2013 relating to the CBA core banking modernisation project that involved digital transformation and software development," the bank wrote. Additionally, CBA said that all other prior year matters were also settled. "CBA will continue to work collaboratively with the ATO and ISA in relation to future registration of eligible R&D activities," it added. While the bank did not provide a figure of how much is to be repaid, it said the agreement "does not result in material impacts to CBA's current or future year financial results". The bank announced the completion of its core banking systems upgrade in August 2013. The six-year program involved around 1,500 full-time staff and a migration of 12 million customers. At the time, the bank's former CEO Ian Narev said CBA was the only true 24/7 core banking system among Australia's banks, and one of the few systems of its scale in the world. "With the project now completed, we are focused on continuous innovation for the benefit of our customers," Narev said in the bank's 2013 financial report. "We believe we are still only at the start of our long-term effort to apply world-leading technology for the benefit of our customers." For the first half of the 2019 financial year, CBA posted AU$4.6 billion in statutory net profit, down AU$300 million from the bank's H1 2018 AU$4.9 billion profit. CBA reported AU$12.4 billion operating income, while IT services expenditure increased by AU$89 million to AU$904 million year on year. Commonwealth Bank and Austrac reach AU$700m agreement over anti-money laundering breaches CBA will pay the largest civil penalty in Australian corporate history after previously laying blame on a coding error and disparate data. They said it couldn't be done: Commonwealth Bank gives in to Apple Pay The bank's iPhone-using customers can now remove that PayTag sticker Commonwealth Bank had previously been touting as sufficient. Commonwealth Bank settles AU$110m blockchain bond Commonwealth Bank and the World Bank have claimed the world's first bond to be created, allocated, transferred, and managed via blockchain. Commonwealth Bank wants to take banking back to the 1970s Using technology, the banking heavyweight wants to get to know its customers better by restoring the relationship people had with banks over 40 years ago. Why NAB won't be upgrading its core banking platform any time soon The bank's CTOO told ZDNet it's far more beneficial to innovate around the customer than make its staff focus on an old system that still works fine.
The Commonwealth Bank of Australia (CBA) has reached an agreement with ATO (the Australian Taxation Office) to settle a dispute over the eligibility of its research and development tax claims. The issue stems from tax claims from FY2012-13 relating to the bank's upgrade of its core systems, a six-year project that occupied 1,500 employees and the migration of 12 million customers. The matter has now been resolved for an undisclosed amount and CBA has withdrawn all Administrative Appeals Tribunal proceedings with the the Australian Taxation Office, as well as Innovation and Science Australia.