transfer pricing

This topic has 1 reply, 2 voices, and was last updated 8 years ago by John Moffat.

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July 6, 2017 at 8:46 am #394806
adarsh1997
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Hi John!
I do have watched your lectures on transfer pricing but still has some doubt about the general concept.
Does the company decide on the transfer price or the divisions individually decide on the transfer price or the divisions collectively decide on the transfer price?
Thanks.
July 6, 2017 at 9:10 am #394818
John Moffat
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There is no rule as to who fixes the transfer price.
However in order to be certain of goal congruent decisions, then whoever is fixing it must make sure it is a ‘sensible’ transfer price using the ‘rules’ that I go through in the lectures.
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