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Transfer Pricing at Cameco Corporation
內容大綱
Transfer pricing used by multinational corporations to lower its tax burden, thereby increasing its consolidated income, can have far-reaching implications for the stakeholders, as a fund manager for Saskhedge fund found out the hard way. A stock investment the manager had made in Cameco Corporation has dropped its value by 20 per cent. In addition, Canada Revenue Agency has initiated a law suit against the firm for alleged tax avoidance in relation to the company's transfer pricing practices with its Swiss subsidiary. The suit could result in an additional tax liability of $800 million to $850 million. The manager needs to explain to the investment board the implications of the lawsuit on the stock price and advise the board on whether the projected $800 to $850 million is a fair estimate.
學習目標
The case can be used in courses that deal with financial reporting, transfer pricing and consolidated financial statements, corporate taxation and differences in international tax regimes, investments and stock valuation, and ethical decision-making in corporate finance. Learning objectives are:<br><ul><li>Understanding transfer pricing.</li><li>Examining the impact of differential tax regimes on a multinational firm’s consolidated financial statements.</li><li>Understanding issues in financial reporting, faced by the investors, tax-payers, and governments.</li><li>Ethical decision making in corporate finance.</li></ul>