Transfer pricing benchmarks
We perform the most robust comparable company searches at the best price, thanks to our AI tools
What is a comparable company search?
Transfer pricing comparable company searches (also called benchmarks) provide an estimate of the arm’s length profitability interval of a related party, by the manual selection of a small sample of comparable companies. The arm’s length interval is generally defined as the interquartile range of the profit indicator, for the selected sample of comparable companies.
Comparable company searches are the cornerstone of most economic analyses in transfer pricing. These searches have to comply with certain rules, often country-specific.
Our approach to transfer pricing benchmarks
1 – Tested party data
Together with our client, we jointly assess the functional profile (roles and responsibilities) of the tested party.
We liaise with our client in order to obtain relevant quantitative and qualitative information of the tested party.
2 – Manual review
A dedicated expert in TP qube team performs the study relying on the most common practices used today.
Potential comparable companies are reviewed one-by-one until a final set of comparable companies is selected. The selection is facilitated by our proprietary algorithms and processes.
3 – Arm’s length range computation
The arm’s length interquartile range is computed. Comparable companies’ financial ratios may be adjusted for different factors (size, geography, maturity, etc.) based on TP qube proprietary models (notably to capture the economic consequences of the Covid-19 crisis).
4 – Results presentation
The results are discussed during a meeting or call with TP qube team and the client.
TP qube sends the final report. The report includes: the search strategy, the detailed rejection matrix, the precise descriptions of each selected comparable company and the arm’s length range.
Benchmarks improved by AI techniques
Algorithms developed by TP qube improve the accuracy and efficiency of the selection of comparable companies.
Our technology helps diminish the costs of transfer pricing benchmarks, while improving the quality of the economic analyses at the heart of your transfer pricing policy.
Our tools enable us to use more reliable sources of information, to be more accurate and consistent in the selection of comparable companies and to automatically cross check the work performed by the analyst.
For you, none! (except the price, which is still something).
For us, better and faster processes thanks to our algorithms trained for the selection of comparable companies. As a result, we propose benchmarks that meet the highest industry standards while reducing costs.
Our comparable company searches are performed in France by our transfer pricing experts.
First results can be delivered in 1 to 2 weeks.
If the functional profile of the tested party is simple or has already been determined, the functional analysis will be limited. Otherwise the functional analysis will be performed by one of our experts.
In certain geographies, it is necessary to perform adjustments to comply with local tax authorities’ guidelines.
In other cases, adjustments are optional. They however improve the precision and relevance of the economic analyses. Adjusting for the change in market conditions due to the Covid-19 crisis is one of the examples. Do not hesitate to visit the dedicated section of our website.