Tax Authorities Are Inspecting Intercompany Transactions, More Specifically Transfer Pricing - Can Technology Alleviate the Problem?

This IDC Perspective discusses about tax authorities regarding the implications of transfer pricing. These discussions encompass intercompany transactions, which involve transfer pricing and are recognized as a complex issue. Furthermore, we explore how technology can offer solutions to address these complexities. We delve into the distinctions between homegrown and software-as-a-service (SaaS) solutions concerning intercompany transactions."Many CFOs and corporate controllers are aware of the major pain points surrounding intercompany transactions, which include transfer pricing. It is not only a compliance issue from a tax view but also a major complaint internally from nonfinance functions, given companies focus on acquiring new legal entities to solve competitive advantages relating to a supply chain or an IP. Many companies ignore the technology solution that can elevate the pain." - Heather Herbst, research director, Worldwide Office of the CFO