Experts from BDO India attend
BDO Partners organised the CEO/CFO forum on ‘Transfer Pricing’ on 7 October at the Balmoral Ballroom at Kingsbury Hotel.
The Transfer Pricing (TP) regulations govern transactions between associated undertakings and require all transactions between such undertakings to be concluded at an arm’s length price.
This event was organised to educate clients and other key stakeholders of BDO on the transfer pricing regulations and the practical issues they have to face when implementing the necessary compliance environment within the company.
The Managing Partner, Sujeewa Rajapakse, welcomed the guests and explained to the audience the importance of transfer pricing for companies in Sri Lanka. He emphasised the need for companies to proactively start complying with these regulations as there are special reporting requirements which are to be effective from the year of assessment 2015/16. The Department of Inland Revenue also has a transfer pricing unit to monitor non compliance with Transfer Pricing Regulations.
Jiger Saiya – Partner BDO Mumbai and Pradeep Kasthala – Partner BDO Hydrabad were the main speakers at the event. They covered a series of topics including tax arbitrage between Associated Undertakings, company’s obligations under TP Regulations, global best practices and the India TP audit experience. They also shared their insights on the opportunities and pitfalls when practically implementing transfer pricing compliant systems within an organisation.
Saiya emphasised the importance of adopting an integrated approach to transfer pricing. An integrated approach will not only cover laws and regulations on Transfer Pricing but also Value Added Tax, Customs Duty, Exchange Control regulation and Corporate Governance to name a few.
The objective behind each focus area will be different and sometimes may even be the opposite of the other. For example, in the case of imports, the transfer pricing officer will try to establish an arm’s length price whereas the Customs officer will try to establish the higher import price. As such, the pricing of goods and services between associated undertakings should take into consideration all possible consequences under several laws and regulations. The presentation by the main speakers was followed by a panel discussion. Rukdevi Fernando - the Commissioner of the Transfer Pricing Unit of the Inland Revenue Department and Neil Umagiliyathe - Managing Director of Dialtex joined the panel discussion where they took up questions from the audience on issues on transfer pricing.
Fernando shared the department’s expectations from the taxpayer with regard to transfer pricing. Neil Umagiliya, who is heading the operations in Sri Lanka for an overseas company, shared his experience with transfer pricing in other jurisdictions and how the local entity had to comply with the requirements of its overseas parent company.
BDO Sri Lanka is a leading professional service firm providing audit, advisory, tax and consultancy services to national and global businesses. BDO is a part and parcel of the global network sharing knowledge and expertise. The firm has expanded into varied service lines providing the client with a seamless array of professional services with high quality delivery. BDO Brand stands for exceptional client service, delivered by exceptional people.