Value Chains | Residual Profit Split | Price Setting & Documentation

  • Value chains definition across functions and countries within the multinational group
  • Allocation of costs and profit elements
  • Integration of arm’s length information such as interquartile ranges on profitability ratios
  • Reporting of routine profits and residual profits (absolute terms, relative terms)
  • As stand-alone application or integration to the transfer pricing management system

 

Areas of Application
  • Initial featuring of new value chains, definition of risk allocation from the transfer pricing perspective
  • Multinational groups with typical “project business” (as compared with “product business”)
  • Year-end adjustment calculations
  • Hybrid related-party units: price setting and arm’s length test within one single data model