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Avalara Announces Intent to Acquire Independent Systems and Programming, Inc.

Avalara and ISPI Join Forces to Offer Businesses the Most Complete Breadth of Sales and Use Tax Offerings and Forge New Relation

At the annual customer event for businesses that use Microsoft Dynamics products and services, Avalara today announced its intention to acquire Independent Systems and Programming, Inc. (ISPI) (www.taxrates.com), a leading provider of software and databases designed to help businesses manage sales and use tax compliance. Since the company’s founding in 1977, ISPI has provided a broad range of tax data solutions, and serves more than 800 customers from its offices in Atlanta and Chicago, both of which will remain in operation.

Avalara (www.avalara.com) is a leading provider of Web-hosted sales tax management services. The company is transforming the sales tax compliance process by providing solutions and services that enable transparent transactions, accurate tax compliance, painless administration and effortless returns and remittance. Similar to Avalara’s strategy, ISPI has built strong partnerships with several leading enterprise resource planning (ERP) and accounting manufacturers, which will further solidify Avalara’s leadership position in the small and mid-size business space. These partnerships include Infor, Exact Software, Everest Software and Syspro. Both Avalara and ISPI offer integrations for the Microsoft Dynamics product line. With the addition of ISPI’s customers, Avalara will provide sales and use tax solutions to more than 21,000 customers. The acquisition is expected to be completed at the end of March.

“Avalara and ISPI have a long, productive history of working together, sharing tax rate research for the benefit of our mutual customers,” said Scott McFarlane, founder, president and CEO of Avalara. “The strategic partnerships that ISPI has established are completely synergistic to those established by Avalara. Furthermore, the combination of the two companies furthers Avalara’s leadership role in the small and medium business sales tax market with a variety of products, from rates to the industry leading sales tax automation product and end-to-end compliance.”

ISPI has delivered on its mission to maintain lines of communication with more than 9,000 taxing authorities spanning more than 45,000 cities across the U.S. Since 2004, ISPI has kept Avalara’s tax rate databases updated with the most current rates for all states. ISPI’s comprehensive database for all 50 U.S. states, territories and possessions and Canada, contains both current and previous state, county, city, transit and other required rates that make up total sales and use tax. ISPI conducts the research and maintenance of rates data, which is critical to the accuracy of the overall sales tax calculation process.

Marshal Kushniruk, Avalara’s executive vice president of customer experience and strategic accounts, said that the joining of the two companies was a logical, customer-centric step. In addition to supporting the delivery of the most accurate sales tax calculation in the industry, the acquisition will give Avalara the means to expand compliance offerings. Combining the forms technology currently offered by ISPI with AvaTax™ and AvaFile™ - Avalara’s managed returns service (MRS) – Avalara and ISPI will be able to scale to accommodate the increasing demand for outsource returns service. Also, the forms will complement Avalara’s Trustfile e-Filing offerings, which are the result of an acquisition announced in 2007. “Not only is this a boost for both organizations, it’s a win for all of our customers – current and future,” said Kushniruk. “By having the technology that drives the filing and remittance process from start to finish available from a single company, our customers will have the peace of mind that goes along with a more secure, stable and integrated experience.”

Of particular note, said both McFarlane and Kushniruk, is ISPI’s flagship product, Laserbridge+™, which handles the paper aspect of Trustfile’s offering. This Microsoft Windows™-based program reads data from tax programs and then imports all of it and populates the correct boxes in each sales or use tax return. The sales tax returns may be printed from ISPI’s catalogue of state-approved forms or printed directly to a form supplied by the state, county or city as required. Data that may be imported includes gross sales, taxable sales, non-taxable sales, transit and school district taxes.

Jack Osman, president and CEO of ISPI, is equally enthusiastic about the acquisition. “Avalara and ISPI share a vision,” he said. Osman said that the products ISPI has developed – including Laserbridge+, the engine that powers Avalara’s managed returns – have the potential to accelerate Avalara’s growth in the MRS space. “The caliber of the Avalara team is impressive. We’re very confident that there will be incredible possibilities for all of us as we move forward.”

About Avalara

Headquartered on Bainbridge Island near Seattle, Washington, Avalara is changing the sales tax landscape by delivering innovative and affordable solutions to small and mid-sized businesses. Avalara’s mission is to transform the sales tax compliance process by creating cost-effective, state-of-the-art solutions. Avalara does so through integrated, on demand, Web-based services that provide transparent transactions, accurate tax compliance, painless administration and effortless returns and remittance.

For more information, contact Andrea Anderson, Director of Marketing at Avalara at 206.780.7008.

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