Parihar - MS Excel - Hyderabad, Andhra Pradesh, India

Mohit Parihar

Hyderabad, Andhra Pradesh, India


MS Excel



Work History

Article Assistant

Suresh & Co

From September 2011

Article Assistant

Suresh and Co. Chartered Accountants

September 2011 - September 2011

Audit :

Statutory Audit of Companies
Audit of Partnerships, schools, Societies etc.
Internal Audit and Management Audit.
Tax Audit under the Income Tax Act.
Proprietary Audit
Stock Audit
Transfer Pricing Audit
Income TAX
Tax Planning, Compliance and Advisory services
Providing Updates on significant changes in law
Providing clarifications and opinions on issues
Vetting of returns prior to filing
Tax Representation before Authorities
Appellate / Legal Services
Advise on Maintenance of records
Internal Audit for tax compliances
Commerical Taxes
Value Added Tax (VAT)
Sales Tax
Central Sales Tax (CST)
Works Contract Tax (WCT)
Entry Tax
Luxury Tax
Entertainment Tax
Service Tax
Company Incorporation and secretarial services
Amalgamation and Mergers
Consultancy & Representation
Appellate and legal matters

We assist both clients companies and other organisations by taking an active advisory role in the running of their business.
— Project Planning And Control
— Business Management And Development
— Financial Management And Control
— Working Capital Management
— Feasibility Studies, Investigations And Takeovers
— Development of Key Business Performance Indicators (Including Productivity) And Monitoring Them
— Evaluating And Designing Business Information Systems
— Succession Planning And Staff Recruitment
— Continuous Improvement Programs For Quality And Change

Assignments Undertaken:

Regular financial reporting and analysis
— Maintenance and Operation of Banking Facilities
— Preparation of Cost Sheets and Cost Data
— Accounting Assistance and Supervision
— Profit and cash flow budgeting and monitoring
— Financial applications
— Costing and pricing
— Annual Profit and Loss Account and Balance Sheet.
— Management Information Systems
— Regular or Periodic management accounts
— Assistance in all aspects of Trade Finance

Content Devoloper

K2 Learning Resources Pvt. Ltd.

October 2010 - February 2011

Worked on the following books and CD content.

100 PAGES TO SUCCESS- A Text book written in a easy to understand style & is a complete course for CA-CPT.

SHORTCUT TO IPCC- A set of handbooks on CA-CPT for quick revision of important keywords that fetch marks in the examination.

CPT MADE EASY-software with exhaustive content is the most comprehensive source of study available to the students for clearing CPT exam.

Content Develpor

K2 Learning

November 2009 - February 2010


Transfer Pricing - Issuing compliance report, Benchmarking and Documentation

Transfer pricing
From Wikipedia, the free encyclopedia

This article provides insufficient context for those unfamiliar with the subject. Please help improve the article with a good introductory style. (July 2012)
Transfer pricing is a profit allocation method used to attribute a corporation's net profit or loss before tax to tax jurisdictions. Transfer prices are the charges made between controlled (or related) legal entities i.e. within the same group. Legal entities considered under the control of a single corporation include branches and companies that are wholly or majority owned ultimately by the parent corporation. Certain jurisdictions consider entities to be under common control if they share family members on their boards of directors.
It refers to the setting, analysis, documentation, and adjustment of charges made between related parties for goods, services, or use of property (including intangible property). Transfer prices among components of an enterprise may be used to reflect allocation of resources among such components, or for other purposes. OECD Transfer Pricing Guidelines state, “Transfer prices are significant for both taxpayers and tax administrations because they determine in large part the income and expenses, and therefore taxable profits, of associated enterprises in different tax jurisdictions.”
Over 60 governments have adopted transfer pricing rules.[1] Transfer pricing rules in most countries are based on what is referred to as the “arm’s length principle” – that is to establish transfer prices based on analysis of pricing in comparable transactions between two or more unrelated parties dealing at arm’s length. The OECD has published guidelines based on the arm's length principle, which are followed, in whole or in part, by many of its member countries in adopting rules. The United States and Canadian rules are similar in many respects to the OECD guidelines, with certain points of material difference. A few countries, such as Brazil and Kazakhstan, follow rules that are materially different overall.
The rules of nearly all countries permit related parties to set prices in any manner, but permit the tax authorities to adjust those prices where the prices charged are outside an arm's length range. Rules are generally provided for determining what constitutes such arm's length prices, and how any analysis should proceed. Prices actually charged are compared to prices or measures of profitability for unrelated transactions and parties. The rules generally require that market level, functions, risks, and terms of sale of unrelated party transactions or activities be reasonably comparable to such items with respect to the related party transactions or profitability being tested.
Most systems allow use of multiple methods, where appropriate and supported by reliable data, to test related party prices. Among the commonly used methods are comparable uncontrolled prices, cost-plus, resale price or markup, and profitability based methods. Many systems differentiate methods of testing goods from those for services or use of property due to inherent differences in business aspects of such broad types of transactions. Some systems provide mechanisms for sharing or allocation of costs of acquiring assets (including intangible assets) among related parties in a manner designed to reduce tax controversy.
Most tax treaties and many tax systems provide mechanisms for resolving disputes among taxpayers and governments in a manner designed to reduce the potential for double taxation. Many systems also permit advance agreement between taxpayers and one or more governments regarding mechanisms for setting related party prices.
Many systems impose penalties where the tax authority has adjusted related party prices. Some tax systems provide that taxpayers may avoid such penalties by preparing documentation in advance regarding prices charged between the taxpayer and related parties. Some systems require that such documentation be prepared in advance in all cases.
Contents [hide]
1 Economic theory
2 General tax principles
2.1 History
2.2 Government authority to adjust prices
2.3 Arm's length standard
2.4 Comparability
2.4.1 Nature of property or services
2.4.2 Functions and risks
2.4.3 Terms of sale
2.4.4 Market level, economic conditions and geography
2.5 Types of transactions
2.6 Testing of prices
2.6.1 Best method rule
2.6.2 Comparable uncontrolled price (CUP)
2.6.3 Other transactional methods
2.6.4 Profitability methods
2.6.5 Tested party and profit level indicator
2.7 Intangible property issues
2.8 Services
2.9 Cost sharing
2.10 Penalties and documentation
3 U.S. specific tax rules
3.1 Comparable profits method
3.2 Cost plus and resale price issues
3.3 Terms between parties
3.4 Adjustments
3.5 Documentation and penalties
3.6 Commensurate with income standard
4 OECD specific tax rules
4.1 Comparability standards
4.2 Transactional net margin method
4.3 Terms
4.4 Adjustments
4.5 Documentation
5 China specific tax rules
5.1 Documentation
5.2 General principles
5.3 Cost sharing
6 Agreements between taxpayers and governments and dispute resolution
7 Reading and overall reference list
8 References
9 External links
[edit]Economic theory

Transfer Pricing with No External Market
The discussion in this section explains an economic theory behind optimal transfer pricing with optimal defined as transfer pricing that maximizes overall firm profits in a non-realistic world with no taxes, no capital risk, no development risk, no externalities or any other frictions which exist in the real world. In practice a great many factors influence the transfer prices that are used by multinational corporations, including performance measurement, capabilities of accounting systems, import quotas, customs duties, VAT, taxes on profits, and (in many cases) simple lack of attention to the pricing.
From marginal price determination theory, the optimum level of output is that where marginal cost equals marginal revenue. That is to say, a firm should expand its output as long as the marginal revenue from additional sales is greater than their marginal costs. In the diagram that follows, this intersection is represented by point A, which will yield a price of P*, given the demand at point B.
When a firm is selling some of its product to itself, and only to itself (i.e. there is no external market for that particular transfer good), then the picture gets more complicated, but the outcome remains the same. The demand curve remains the same. The optimum price and quantity remain the same. But marginal cost of production can be separated from the firm's total marginal costs. Likewise, the marginal revenue associated with the production division can be separated from the marginal revenue for the total firm. This is referred to as the Net Marginal Revenue in production (NMR) and is calculated as the marginal revenue from the firm minus the marginal costs of distribution.

Transfer Pricing with a Competitive External Market
It can be shown algebraically that the intersection of the firm's marginal cost curve and marginal revenue curve (point A) must occur at the same quantity as the intersection of the production division's marginal cost curve with the net marginal revenue from production (point C).
If the production division is able to sell the transfer good in a competitive market (as well as internally), then again both must operate where their marginal costs equal their marginal revenue, for profit maximization. Because the external market is competitive, the firm is a price taker and must accept the transfer price determined by market forces (their marginal revenue from transfer and demand for transfer products becomes the transfer price). If the market price is relatively high (as in Ptr1 in the next diagram), then the firm will experience an internal surplus (excess internal supply) equal to the amount Qt1 minus Qf1. The actual marginal cost curve is defined by points A,C,D.

Transfer Pricing with an Imperfect External Market
If the firm is able to sell its transfer goods in an imperfect market, then it need not be a price taker. There are two markets each with its own price (Pf and Pt in the next diagram). The aggregate market is constructed from the first two. That is, point C is a horizontal summation of points A and B (and likewise for all other points on the Net Marginal Revenue curve (NMRa)). The total optimum quantity (Q) is the sum of Qf plus Qt.
[edit]General tax principles

Commonly controlled taxpayers often determine prices charged between such taxpayers based in part on the tax effects, seeking to reduce overall taxation of the group. OECD Guidelines state, at 1.2, “When independent enterprises deal with each other, the conditions of their commercial and financial relations (e.g., the price of goods transferred or services provided and the conditions of the transfer or provision) ordinarily are determined by market forces. When associated enterprises deal with each other, their commercial and financial relations may not be directly affected by external market forces in the same way.” Recognizing this, most national and some sub-national income tax authorities have the legal authority to adjust prices charged between related parties. Tax rules generally permit related parties to set prices in any manner they choose, but permit adjustment where such prices or their effects are outside guidelines.[2]
Transfer pricing rules vary by country. Most countries have an appeals process whereby a taxpayer may contest such adjustments. Some jurisdictions, including Canada and the United States, require extensive reporting of transactions and prices, and India requires third party certification of compliance with transfer pricing rules.
Transfer pricing adjustments have been a feature of many tax systems since the 1930s. Both the U.S. and the Organization for Economic Cooperation and Development (OECD, of which the U.S. and most major industrial countries are members) had some guidelines by 1979. The United States led the development of detailed, comprehensive transfer pricing guidelines with a White Paper in 1988 and proposals in 1990-1992, which ultimately became regulations in 1994.[3] In 1995, the OECD issued the first draft of current guidelines, which it expanded in 1996.[4] The two sets of guidelines are broadly similar and contain certain principles followed by many countries. The OECD guidelines have been formally adopted by many European Union countries with little or no modification.
The OECD[5] and U.S.[6] systems provide that prices may be set by the component members of an enterprise in any manner, but may be adjusted to conform to an arm's length standard. Each system provides for several approved methods of testing prices, and allows the government to adjust prices to the midpoint of an arm's length range. Both systems provide for standards for comparing third party transactions or other measures to tested prices, based on comparability and reliability criteria. Significant exceptions are noted below..
[edit]Government authority to adjust prices
Most governments have granted authorization to their tax authorities to adjust prices charged between related parties.[7] Many such authorizations, including those of the United States, United Kingdom, Canada, and Germany, allow domestic as well as international adjustments. Some authorizations apply only internationally.[citation needed] Most, if not all, governments permit adjustments by the tax authority even where there is no intent to avoid or evade tax.[8]
Adjustment of prices is generally made by adjusting taxable income of all involved related parties within the jurisdiction, as well as adjusting any withholding or other taxes imposed on parties outside the jurisdiction. Such adjustments generally are made after filing of tax returns. For example, if Bigco US charges Bigco Germany for a machine, either the U.S. or German tax authorities may adjust the price upon examination of the respective tax return. Following an adjustment, the taxpayer generally is allowed (at least by the adjusting government) to make payments to reflect the adjusted prices.
Most rules require that the tax authorities consider actual transactions between parties, and permit adjustment only to actual transactions.[9] Multiple transactions may be aggregated or tested separately, and testing may use multiple year data. In addition, transactions whose economic substance differs materially from their form may be recharacterized under the laws of many systems to follow the economic substance.
[edit]Arm's length standard
Nearly all systems require that prices be tested using an "arm's length" standard.[10] Under this approach, a price is considered appropriate if it is within a range of prices that would be charged by independent parties dealing at arm's length. This is generally defined as a price that an independent buyer would pay an independent seller for an identical item under identical terms and conditions, where neither is under any compulsion to act.
There are clear practical difficulties in implementing the arm's length standard. For items other than goods, there are rarely identical items. Terms of sale may vary from transaction to transaction. Market and other conditions may vary geographically or over time. Some systems give a preference to certain transactional methods over other methods for testing prices.
In addition, most systems recognize that an arm's length price may not be a particular price point but rather a range of prices. Some systems provide measures for evaluating whether a price within such range is considered arm's length, such as the interquartile range used in U.S. regulations. Significant deviation among points in the range may indicate lack of reliability of data.[11] Reliability is generally considered to be improved by use of multiple year data.[12]
Most rules provide standards for when unrelated party prices, transactions, profitability or other items are considered sufficiently comparable in testing related party items.[13] Such standards typically require that data used in comparisons be reliable and that the means used to compare produce a reliable result. The U.S. and OECD rules require that reliable adjustments must be made for all differences (if any) between related party items and purported comparables that could materially affect the condition being examined.[14] Where such reliable adjustments cannot be made, the reliability of the comparison is in doubt. Comparability of tested prices with uncontrolled prices is generally considered enhanced by use of multiple data. Transactions not undertaken in the ordinary course of business generally are not considered to be comparable to those taken in the ordinary course of business. Among the factors that must be considered in determining comparability are:[15]
the nature of the property or services provided between the parties,
functional analysis of the transactions and parties,
comparison of contractual terms (whether written, verbal, or implied from conduct of the parties),and
comparison of significant economic conditions that could affect prices, including the effects of different market levels and geographic markets.
[edit]Nature of property or services
Comparability is best achieved where identical items are compared. However, in some cases it is possible to make reliable adjustments for differences in the particular items, such as differences in features or quality.[16] For example, gold prices might be adjusted based on the weight of the actual gold (one ounce of 10 carat gold would be half the price of one ounce of 20 carat gold).
[edit]Functions and risks
Buyers and sellers may perform different functions related to the exchange and undertake different risks. For example, a seller of a machine may or may not provide a warranty. The price a buyer would pay will be affected by this difference. Among the functions and risks that may impact prices are:[17]
Product development
Manufacturing and assembly
Marketing and advertising
Transportation and warehousing
Credit risk
Product obsolescence risk
Market and entrepreneurial risks
Collection risk
Financial and currency risks
Company- or industry-specific items
[edit]Terms of sale
Manner and terms of sale may have a material impact on price.[18] For example, buyers will pay more if they can defer payment and buy in smaller quantities. Terms that may impact price include payment timing, warranty, volume discounts, duration of rights to use of the product, form of consideration, etc.
[edit]Market level, economic conditions and geography
Goods, services, or property may be provided to different levels of buyers or users: producer to wholesaler, wholesaler to wholesaler, wholesaler to retailer, or for ultimate consumption. Market conditions, and thus prices, vary greatly at these levels. In addition, prices may vary greatly between different economies or geographies. For example, a head of cauliflower at a retail market will command a vastly different price in unelectrified rural India than in Tokyo. Buyers or sellers may have different market shares that allow them to achieve volume discounts or exert sufficient pressure on the other party to lower prices. Where prices are to be compared, the putative comparables must be at the same market level, within the same or similar economic and geographic environments, and under the same or similar conditions.[19]
[edit]Types of transactions
Most systems provide variations of the basic rules for characteristics unique to particular types of transactions. The potentially tested transactions include:
Sale of goods. Identical or nearly identical goods may be available. Product-related differences are often covered by patents.[20]
Provision of services.[21] Identical services, other than routine services, often do not exist.
License of intangibles.[22] The basic nature precludes a claim that another product is identical. However, licenses may be granted to independent licensees for the same product in different markets.
Use of money.[23] Comparable interest rates may be readily available. Some systems provide safe haven rates based on published indices.
Use of tangible property.[24] Independent comparables may or may not exist, but reliable data may not be available.
[edit]Testing of prices

Qualifications & Certifications

SRN - Sitadevi Ratanchand Nahar Adarsh College

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Athena Public School (Bangalore)

3rd Standard

Shri Jalaram Vidyalaya

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SRN adarsh college bangalore

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