ktMINE’s Chief Operating Officer, John Wiora, was among the more than 40 Transfer Pricing leaders that shared their insights at the TP Minds West Coast Conference in San Francisco. Trending TP issues addressed at the conference included BEPS, digital economy taxation, managing risk, and the changing international landscape. Wiora led a breakfast discussion on the myths surrounding data asymmetry for Transfer Pricing, such as:
- Taxpayers believe they have the most information on their company’s intangibles
- Taxpayers believe they hold power over tax administrations because they have all the information
- Corporates and consultants are able to easily gather all the relevant data necessary for their transactions
From the generated inquiries, it became obvious that many were unaware of the danger of believing these myths. During the discussion, the audience engaged in several polling questions. 80% believe that it is extremely important to have all relevant internal TP support information, but over 50% thought it was hard to access that data from internal departments. Half of the respondents spend over 20 hours gathering the relevant internal data. This may be why the majority, 90%, will be looking for new sources of information to support analyses next year.
Through data and research, corporates and consultants can easily identify areas of risk associated with these assumptions. While there is much nuance, the simplest breakdown of this issue is that if practitioners don’t ensure they have all the data that exists publicly they expose themselves to unnecessary risks. Through improved technology as well as increased efforts of transparency, government regulatory agencies now have access to more data than ever before. This bodes the question: what risk is there to your analysis by not knowing what information the tax authority has at their disposal? Am I certain that all my internal data requests outside of the tax team are being properly serviced by groups with different focuses and agendas?
Fortunately, there are ways to identify these areas of risk before they become an issue and service providers such as ktMINE are poised to help!
To learn more about how ktMINE addresses these areas of risk contact us.