30% of CFOs See Transfer Pricing as the Greatest Risk

by Dennis Stuchell 26. July 2012 15:40
Among 60 chief financial officers of companies with more than $1 billion in annual revenues, nearly one-third (30%) said that transfer pricing was their biggest tax-related challenge and risk, according to a new survey by Alvarez & Marsal reported by WSJ.com). Only four CFOs reported spending most of their time—and money—on transfer pricing issues, but the prevalent concern among respondents helped push transfer pricing to Number 2 on the survey of risk, just behind global compliance.   The higher risk profile for transfer pricing has resulted from increased attention by the IRS.  Intellectual property, including trademarks, trade names, patents, copyrights, and internally developed software, is increasingly being shared among multinationals. The IRS, under Sec 482, requires related parties to report transfer pricing at arm’s length. In this environment, a well structured corporate transfer pricing plan is essential to withstand IRS audit scrutiny. 
Categories: Advisory