Explore the opportunities now available to achieve automated segmentation, forecasting, and price-setting – including alignment with customs value – in a webinar held in partnership between ITR and EXA AG
Abstract
When an SAP S/4HANA migration is planned, is in progress, or has already finished, why should there be a need for an additional tool or application for operational transfer pricing (OTP)?
Today, TP is more than maintaining condition records; it is about global tax and compliance. Pricing processes and results must be in line with your group’s TP policy. It begins with profitability checks by segmenting a legal entity’s profit and loss statements by transaction group, transaction partner, and TP function to test them against benchmarks.
Complex conversion rules are required to enrich millions of ERP records with TP-specific attributes, plus multi-level cost allocations. Calculating and updating transfer prices at the product level brings more complexity, as TP methods such as transactional net margin, resale-minus, or cost-plus need to be applied. Finally, forecast and customs duties data for simulations are the basis to obtain optimal transfer prices during the year, avoiding year-end adjustments.
ERP systems, even the new S/4HANA, do not deliver such very specific functionalities. Accordingly, multinational enterprises (MNEs) can continue with manual spreadsheets or must decide whether to build or buy an OTP solution. Some MNEs may also consider developing their own OTP applications using modelling platforms, which might be inefficient and resource intensive to maintain over time.
Today, TP is more than maintaining condition records; it is about global tax and compliance. Pricing processes and results must be in line with your group’s TP policy. It begins with profitability checks by segmenting a legal entity’s profit and loss statements by transaction group, transaction partner, and TP function to test them against benchmarks.
Complex conversion rules are required to enrich millions of ERP records with TP-specific attributes, plus multi-level cost allocations. Calculating and updating transfer prices at the product level brings more complexity, as TP methods such as transactional net margin, resale-minus, or cost-plus need to be applied. Finally, forecast and customs duties data for simulations are the basis to obtain optimal transfer prices during the year, avoiding year-end adjustments.
ERP systems, even the new S/4HANA, do not deliver such very specific functionalities. Accordingly, multinational enterprises (MNEs) can continue with manual spreadsheets or must decide whether to build or buy an OTP solution. Some MNEs may also consider developing their own OTP applications using modelling platforms, which might be inefficient and resource intensive to maintain over time.
Key points in this webinar:
- Beyond condition records – the TP life cycle runs from segmentation to forecasting and dynamic price-setting to final year-end adjustments.
- OTP requirements – OTP consists of a full profit and loss breakdown by transaction group, transaction partner, and TP function performed by the individual entity.
- Forecasting, simulations, and price-setting – the calculation and updating of transfer prices is vital in an OTP solution. The webinar will cover how to manage TP to avoid large year-end adjustments.
- Transfer price and customs value – the alignment of TP with customs is a business case on its own that can justify an investment in a professional OTP solution.
- The make-or-buy question – the webinar will explore the main factors in deciding between developing a solution internally or licensing SAP add-on software from a specialised technology vendor such as EXA AG.
- OTP enterprise-grade software in action – the webinar will feature a demonstration of EXA’s solution, which can be seamlessly integrated into your existing SAP ERP and/or S/4HANA.
Our Expert
Dr.-Ing. Frank Schoeneborn
Head of Global OTP Program, EXA AG
Before joining EXA in 2020, Frank Schoeneborn was a partner with EY for five years and advised experts from the fields of tax, accounting, finance and IT who deal with the operative implementation of transfer pricing in day-to-day processes and IT systems.
Before moving to professional services in 2015, he gained 17 years of industry experience, having worked in large multinational groups as a chief financial officer in the UK, as head of global divisional finance, and head of global operational transfer pricing management. He is a frequent speaker at international conferences, symposiums and is the author of several articles on operational transfer pricing.
Register now
Whether you are in the process of selecting a technology solution for OTP or aiming to replace your existing technology, this webinar is designed to bring you up to speed on what is possible today with the latest OTP innovations.
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