ONESOURCE Transfer Pricing Loan Analysis Module

ONESOURCE Transfer Pricing

Loan Analysis for Intercompany Loans

The role of intercompany loans in transfer pricing has become more prevalent in the operations of multinational corporations. Documenter from ONESOURCE Transfer Pricing has a built-in loan analysis module that makes analyzing the arm’s length-nature of intercompany loans an easy step-by-step process. Our ONESOURCE Transfer Pricing loan module partners with market leaders Moody’s Analytics and DealScan, allowing companies, accounting firms and tax authorities to better plan, document and audit intercompany loans.

These two tools integrate with ONESOURCE Transfer Pricing Documenter software in the following 3-step intercompany loan analysis process:

Step 1: Get credit ratings

Moody’s Analytics RiskCalc™ gives users implied credit rating data. This easily integrates with ONESOURCE Transfer Pricing software and can be used as a starting point for selection of your comparable loans, as well as included in your transfer pricing documentation report.

Step 2: Search for comparable loans

LoanConnector DealScan is a database that contains over 220,000 third-party loan transactions. Customers working in the Documenter software can directly link to DealScan to search for comparable loans to the intercompany loan being analyzed.

Step 3: Analyze the credit spread of the intercompany loan and the comparable loans

Using the loan data from DealScan, ONESOURCE Transfer Pricing Documenter allows users to calculate the credit risk spread by stripping out the relevant risk-free rate for these comparable loans. The resulting range of credit risk spreads can be compared to the credit risk spread of the intercompany loan, effectively documenting the arm’s length nature of your intercompany transaction.

ONESOURCE Transfer Pricing Documenter also provides software users with the corresponding documentation reports custom-tailored for loan analyses.