Transfer Pricing Policy
Our experts help the Clients to prepare transfer pricing policies, which constitute to a coherent, standardized and transparent set of rules and principles of conducting the transactions between related entities, considering individual levels of management planned for the organizational structure of capital group.
Transfer pricing policy is an element of transfer pricing system, the activity of which is directed towards fulfilling the strategic and operational targets of the company.
The main goal of the transfer pricing policy is an appropriate, from the point of view of company`s goals, and also tax regulations, shaping of transaction realization rules between related subjects, which is carried out by the following processes:
- standardizing of the transaction process,
- standardizing of the assets or benefits transfer valuation and
- standardizing of the transaction realization rules and control of regulations.
The responsibility for the fulfilment of the processes indicated lies with the persons, to which the transfer pricing policy is addressed, in particular the management of capital group, the management of the individual related subjects, personnel of financial departments, personnel of operations departments, and personnel of human resources management.
Procedure of making the transfer pricing policy
Procedure of making the transfer pricing policy includes at least the following points:
- analysis of capital group strategy and division of this strategy into tactical and operational goals,
- analysis of capital group organizational structure and internal management subsystems,
- data analysis in the range of historical and ongoing transactions,
- analysis of possible future transactions (simulation of possible transactions on the basis of the analysed data and strategic goals of the capital group),
- internal procedures in the range of internal control and risk management,
- analysing legal regulations in the country of the seat of the capital group and the countries, in which the policy is to be implemented,
- cost calculation analysis,
- analysis of the remuneration system of the related subjects management personnel,
- analysing the evaluation system of individual achievements gained by related entities,
- drawing up of an effective procedure of the transaction documentation management,
- preparing of the settlements system and control system of the transactions realization,
and many others, the aim of which is to provide the proper functioning of transfer pricing policy.
In order to get familiarized with our full offer, we encourage you to contact our consultants.