What is TP adjustment? I mean the technical terms of foreign companies in finance ~

TP means transfer pricing, which means transfer pricing. Transfer pricing refers to the price determined by affiliated enterprises when selling goods, providing services and transferring intangible assets. In transnational economic activities, transfer pricing between affiliated enterprises has become a common means of tax evasion. The general practice is: when enterprises in high-tax countries sell goods, provide services and transfer intangible assets to their affiliated enterprises in low-tax countries, they set lower prices; Enterprises in low-tax countries set high prices when selling goods, providing services and transferring intangible assets to their affiliates in high-tax countries. In this way, profits will be transferred from high-tax countries to low-tax countries, so as to minimize their tax burden.

Finance generally refers to financial activities and financial relations. The former refers to the activities of enterprises involving funds in the production process, indicating the formal characteristics of finance; The latter refers to the economic relationship between enterprises and financial activities, revealing the content and essence of finance. Therefore, in a nutshell, enterprise finance is the capital movement in the process of enterprise reproduction, which embodies the economic relationship between enterprises and all aspects.

fundamental principle

The basic principles of financial management include systematic principle, cash balance principle, income risk principle and interest coordination principle.

1, systematic principle

Systematic principle means that financial management is a subsystem of the enterprise management system of each member of the group, and the enterprise management system itself is composed of several subsystems such as fund-raising management, investment management and distribution management.

Adhering to the systematic principle in financial management is the primary starting point of financial management, with three specific requirements.

The first point is global optimization, and only a globally optimized system is the optimal system.

The second point is structural optimization. Any system is a hierarchical system with a certain hierarchical structure. In the aspect of enterprise resource allocation, we should pay attention to the optimization of structural proportion and ensure the overall optimization, such as optimizing capital structure, asset structure and distribution structure.

The third point is strong adaptability to the environment, and the financial management system must maintain appropriate flexibility to adapt to changes in the environment.

2, the principle of cash balance

The principle of cash balance refers to the cash basis rather than the accrual basis in financial management, which objectively requires cash income (inflow) and cash expenditure (outflow) to achieve dynamic balance in quantity and time, that is, cash flow balance. The basic method to keep cash balance is cash budget control. Cash budget can be said to be a comprehensive balance of financing plan, investment plan and distribution plan, so cash budget is an effective tool for cash flow control.