International Journal of Accounting and Taxation

Evolution of the Internal Audit Function in the Management of Transfer Pricing
Pietro PAVONE, Clizia DI NUNZIO

Abstract
This study focuses on the management of tax risk in intercompany transactions.Transfer pricing assumes there is an intimate relationship between business factors and tax factors, thus administrative and tax obligations must be aligned with the company's strategic variables.In this context, the need to build and represent a transfer pricing risk assessment model is a priority in order to check that intragroup flows comply with the tax regulations of the various countries the companies involved in the transactions are located, thus ensuring the desired transfer pricing scheme fully complies with the legislator’s intent. To this end, this paper highlights the importance of the audit function in company groups operating on the international stage and aims to trace the desirable future prospects towards which the internal auditing activities should be directed in order to support group tax dynamics, so that there is a balance between the need to protect tax interests and, at the same time, the need for taxation not to become an obstacle to transnational trade and investment.

Full Text: PDF     DOI: 10.15640/ijat.v6n2a2