It is not surprising that Indonesia Financial Services Authority ("Otoritas Jasa Keuangan", "OJK", or "FSA") issued regulations to regulate the conditions for which an affiliate transaction can be carried out. The regulation, namely Financial Services Authority Regulation No. 42/2020 ("FSA-REG 42/2020") concerning affiliated transactions and conflicts of interest. In this discussion, KAP Agus Ubaidillah dan Rekan (TGS AU Partners) will only discuss affiliate transactions regulated by the FSA.
The Transactional Net Profit Method (TNMM) uses a profit level indicator (PLI) as the object of the comparison to apply the arm's length principle for transfer pricing.
Cost-Plus Method for Transfer Pricing The Cost-Plus method is suitable to used by manufacturing companies or those performing production functions and can also be used for service providers. The Cost Plus method determines the transfer
The Resale Price method uses a comparison of the gross profit margin between a company with the controlled transaction and the gross profit margin of the comparable uncontrolled transaction (another company that is an independent party). The
The Comparable Uncontrolled Price "CUP" method compares the price charged for goods or services transferred in a controlled transaction with the price charged for goods or services in an uncontrolled transaction between comparable independent parties in similar circumstances.