About this Presentation
The goal of the presentation is to focus on the issues generated by transfer pricing policies when implementing a management accounting system based on throughput accounting in a multinational company operating in 53 countries around the world. An international transfer pricing system has to be documented and justified to the local tax authorities. The objective of the session is first to review the main transfer pricing rules available and then to present the simplified solution we finally implemented. We need to change the subsidiaries and the branches of the company in order to transform a cost center to a profit center in France because we have to reimburse French investment funds. Since throughput accounting prevents cost allocation, it becomes very difficult to design a transfer pricing solution based on a 'cost plus' methodology. The evaporating cloud of the dilemma is provided. To overcome this dilemma, we defined a simplified transfer pricing solution.
What Will You Learn
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