As we see the Pokemon Go fever going up around the world, we were interested in knowing why is the world so excited about this game. In a nutshell, Pokemon Go is all about searching for Monsters/Pokemons that are in the world using an app. The players find, capture, and train them. Then players will use them to battle with other players. After playing for a while, the team starting asking themselves, playing Pokemon Go is very similar to our daily transfer pricing activities isn’t?
Bear with me, for those familiar to transfer pricing, one of the core parts of transfer pricing analyses is benchmarking. A benchmarking involves using databases to search for comparable data and in principle is almost as intense as playing Pokemon Go, here is how.
How is Benchmarking Analysis similar to playing Pokemon GO?
Pokemon Go APP: In transfer pricing, our app will be the databases available to ‘find and capture’ comparable data. Without appropriate databases, you are unlikely to find and capture your comparable data or ‘TP Pokemons.'
Monsters /Pokemons: Our ‘TP Pokemons’ are the comparable data that we need to identify through a strict process that requires experience and knowledge in transfer pricing. Similar to Pokemon Go only ‘playing’ will train you to identify ‘TP Pokemons.’
Capture/Train Pokemons: The benchmarking analysis involved performing a comparability and financial analysis to ensure that our comparable data or TP Pokemons are RELIABLE. This is key when performing benchmarking analysis as unreliable comparable data can raise transfer pricing risks for taxpayers.
Battle with other players: The end game with a benchmarking analysis is to have reliable data to support your transfer pricing position. The end battle is with the Tax Authorities in the event of a TP review or audit. For this reason, ensuring your comparable data or ‘TP Pokemons’ is reliable enough is key to stand in a battle with the Tax Authorities.
Need help with benchmarking analysis to find your comparable data or ‘TP Pokemons’?
Visit our transfer pricing benchmarking website or contact Transfer Pricing Solutions
+61 (3) 59117001
Thec Covid-19 pandemic has triggered the most severe recession and is causing enormous damage to the world economy. The economic downturn will impact a group’s transfer prices, analysis and documentation, more so with the BEPS Action Plans in place and the high level of transfer pricing scrutiny across the globe.
JobKeeper forms part of taxable income in the tax return. Makes sense, it is a subsidy against wages, so I am sure there are no surprises there, but how do you assess the arm’s length financial outcomes of the entity for transfer pricing purposes?
The ATO expect that Australian entities will retain the benefit of the JobKeeper payment they receive. So how do you treat the JobKeeper payments for transfer pricing purposes?