Transfer pricing comparability requires functional alignment, reliable financial data, and careful review of working capital and receivables adjustments.

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....Transfer pricing of low-end IT-enabled back-office support services requires functional comparability and reliable public financial data. Comparable companies may be included where their accounting, human-resources or BPO functions are broadly similar, but excluded for unavailable data, abnormal royalty-driven profits, high-end consultancy or audit functions, or unsegregated merger effects. Working capital adjustment requires examination of demonstrated differences in collection periods between the tested party and comparables. Interest on outstanding associated-enterprise receivables requires review of the taxpayer's debt-free status and whether its average collection period is abnormally high against industry practice; denial of working capital adjustment should not coexist with an unexamined receivables interest adjustment.....