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TPAD helps with the preparation of local transfer pricing files by taking an intelligent and automated approach that supports efficiency and high documentation standards.

On the basis of the documentation compliance requirements set forth in BEPS Action 13, the master file/local file approach has been adopted by most tax jurisdictions around the world. In order to meet these requirements, multinational enterprises (MNEs) are often required to contemporaneously prepare and maintain transfer pricing documentation in the form of a local file for each of the legal entities that forms part of a MNE. This often results in a long and costly process for MNEs.

With our own developed transfer pricing tool – “TPAD”– preparation of local files can now be optimised. By combining Word templates and Excel files, several local files can be created at once, using TPAD ensuring a time efficient process minimising potential errors induced from manual handling of large data batches. 

The simplicity of TPAD is a great advantage, as the programme only requires Excel files and one Word file (local file template) as input, resulting in several Word files as output.

Download full version of the product sheet and read more about the TPAD process and advantages here:

  

TPAD Client Case

The situation
In response to the increasing transfer pricing documentation compliance requirements in the jurisdiction of operations, a Danish multinational manufacturer of building materials was looking to centralise and streamline their process for preparing compliant transfer pricing documentation for more than 30 entities. Historically, a fragmented approach was taken, where the use of local advisers attracted high fees without ensuring consistency in the transfer pricing documentation package.

The solution
Applying the existing local file template of the Group, an information request list ("IRL") was prepared to both systemise existing centrally available data and gather/validate the outstanding data locally, as required for the preparation of the local files. The process allowed for the Group to maintain the information gathering themselves, but in a much more effective manner than previously.
The existing local file template was furthermore adapted to be utilised with TPAD, taking into consideration varying requirements as it would need to cover both entities engaged in manufacturing and distribution.

The success
By utilising TPAD and the processes associated herewith, the Group was able to achieve significant cost and time savings already in the first year and had all of the local files in scope for the engagement ready less than 3 months after the financial year end. Further, by engaging in a 3-year engagement, the Group was able to gain additional savings in year 2 and 3 by optimising the process even further.
In summary, the Group was able to achieve documentation compliance earlier and for more entities than before at significantly lower costs.                 

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