Why is transfer pricing such a significant issue both from a financial and managerial perspective?© BrainMass Inc. brainmass.com June 21, 2018, 2:07 pm ad1c9bdddf
Transfer pricing changes division profits and so division managers make decisions to try to improve those division profits, even if the consolidated organization is not better off. So, from a managerial view, transfer prices alter incentives and may keep division goals from aligning perfectly with organizational goals. From a financial view, when the ...
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