To view the English with Japanese translation version of the webcast click here
In February, the Advance Pricing and Mutual Agreement (“APMA”) office of the Internal Revenue Service (“IRS”) released its Functional Cost Diagnostic (“FCD”) workbook, which is a tool that the APMA office may request from taxpayers during the APA process. The release of the FCD workbook has generated interest, and numerous questions, from both taxpayers and other tax authorities.
To address these questions, we invited John Hughes, the APMA Director, to this webcast. In this webcast, we start with basic discussions covering what the FCD workbook is, how it works, and how it will be used in the APA due diligence phase. We also have an in-depth discussion on the financial segmentation expected by the workbook, the rationale for exploring functional costs, the relevance of interrelated transactions, and the treatment of profits (and losses) in the workbook’s “pro forma” profit split component.
This FCD webcast is targeted at companies that already have experience with the IRS’s APA program as well as companies considering an APA, and will be of particular interest to companies with highly integrated value chains considering an APA with the United States. However, this webcast will be valuable to any company considering transfer pricing method based on the value chain analysis and following the latest global transfer pricing trends.