An even faster and cheaper way to get an estimation of an arm's length profitability range
What are statistical benchmarks?
Statistical benchmarks are a new innovative tool to provide an estimation of the normative profitability of a company based on its own characteristics.
This approach is easier to implement than classic benchmarks, since it does not require to manually select comparable companies, and, as a result, is significantly less costly.
Statistical benchmark process
1 - Tested party data
TP qube collects all relevant qualitative and quantitative information on the company to be tested.
The functional profile of the company is discussed during a call
2 - Proprietary algorithm
Using the characteristics of the tested party, the proprietary TP qube algorithm computes an estimation of the arm’s length profitability.
The model is based on financial data of thousands of independent companies.
3 - Interquartile range
TP qube provides the interquartile range estimated by the model in a report in pdf format
The algorithm details are saved on our servers.
4 - Results assessment
TP qube provides an estimation of the reliability of the results, depending on the characteristics of the tested party compared to the full sample of independent companies.
The results are discussed during a meeting or call with TP qube team and the client.
Statistical benchmarks provide a quick and accurate estimation of the arm’s length interval of a tested party
The algorithm combines qualitative (industry, maturity, geography, etc.) and quantitative (size, working capital, balance sheet ratios, etc.) indicators to better fit the results to the characteristics of the tested party.
An innovative approach
Statistical benchmarks prove a quick and accurate estimation of the normative profitability of a company. This approach allows to ignore the time-consuming process of the manual review of potentially comparable companies.
Statistical benchmarks capture comparability factors that are usually ignored in classic benchmarks (such as size, maturity, etc.).
All our benchmarks are performed in France by our transfer pricing experts.
Statistical benchmarks are used in numerous contexts, due to their low cost, rapidity, and their better fit to the characteristics of the tested party.
As an example, these benchmarks are well-suited for mid-sized groups, willing to decrease their compliance costs. They are also particularly well suited to assess the fiscal risk of larger groups, or as a corroborative approach.
Yes! Both analyses may be carried out in parallel, but can also be combined. Selected comparable companies are then adjusted to better reflect the characteristics of the tested party.
Results can be delivered in a matter of days.