Why Transfer Pricing:
- more accurately charge for internal services
- more accurately cost out products, services, customers, channels
- outsourcing decisions
- benchmarking
- so internal customers know what different services cost
What is Transfer Pricing
Transfer Pricing is:
- identifying and costing your activities and services
- charging internal customers for your services either through accounting
system or some report
- internal customers are only charged for quantity of service they agree to
buy
- Service Level Agreements established as part of contract with
internal customers
- Service and activity unit price agreed to upfront.
Institute
of
Management
Accounting (SMA 5G) Implementing Shared Service
Centers
Leahy, Tad, “Technology Goes
Out, Money Comes Back,” IT Financial Management, June 2001, P.15,
(Charging business units for their IT usage requires)
Thomas, Mike, “Transfer Pricing,”
Management Accounting Quarterly, Spring 2001, P.4
Triplett, Ann & Jon Scheumann, “Managing
Shared Services with ABM,” Strategic Finance, February 2000, P.40
Call or email below
Jim Brimson or Pat Dowdle at 972-980-7407 to find out
how Transfer Pricing can help people understand and control shared services.
|
