What Should Be Included in Transfer Pricing Documentation?
Transfer pricing documentation should typically include: 1. Functional Analysis: Describing the functions performed, risks assumed, and assets used by each entity involved in the transactions. 2. Economic Analysis: Providing a detailed analysis of the pricing method used to ensure it aligns with the arm's length principle. 3. Comparable Analysis: Identifying comparable transactions or companies that can justify the pricing applied. 4. Financial Information: Detailed financial data for the entities involved, including financial statements and profit and loss accounts.