GLG News by Mr. Nitish Grover FCA, AICPA Intl Associate, Principal, Owner
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What are the transfer pricing problems for companies doing business in India?
September 2, 2011
Under the garb of Transfer Pricing, Indian arms of Foreign IT Firms IBM, Accenture, Capgemini under-report revenues | economictimes.indiatimes.com
India has long battled problems with tax evasion and tax avoidance. With enhanced economic growth and more multinationals setting up in India, the problem of companies transferring profits overseas to their home country or a third country by underreporting their Indian revenues has become rampant. This practice is made possible by the different tax rates in various jurisdictions across India and also because of companies “treaty shopping” under double taxation avoidance agreements.
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The realignment of currencies and effects on accounting statements
August 22, 2011
Yen and Gold Soar on Recession fears | www.ft.com
As the value of gold increases, the relative competitiveness of economies is being affected. It may even alter how companies report their performance.
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IFRS and The Continuing Roundabout Discussion - Its Politics Not Accounting
July 16, 2011
Investors Defend FASB Role on IFRS | www.cfo.com
The referred news article relates the views of certain individuals that the IASB may not be able to properly administer International Accounting Standards without being politically influenced. They argue that the FASB is better placed to develop accounting standards and withstand political pressure. In this analysis I look at some aspects of the debate.
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Greece - The End of The Road for The Euro? Accounting Implications?
June 19, 2011
Papandreou Pleads for Unity on Crisis | www.ft.com
While Greece, Ireland and the rest of Europe ponder over the debt crisis which goes hop skip and jump I start to wonder whether the Euro is headed for a demise or slide into oblivion. I also give below my thoughts on accounting implications of the present crisis.
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Offshoring - The Unstoppable Vehicle?
May 29, 2011
Offshore Outsourcing: For Smaller Companies Too | www.cfo.com
The referred article speaks of offshoring and outsourcing making sense for small companies also as against only larger companies. In this analysis I look at why and how outsourcing is progressing and why it may face economic obstacles atleast so far as expansion in India is concerned.
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Accounting Convergence - The Uphill Climb
April 28, 2011
Accounting Boards Delay Convergence Beyond June 30 | www.cfo.com
The way in which the convergence of accounting standards is progressing reminds me of the progress of the pilgrim in The Pilgrims Progress by Bunyan. The path to convergence is not easy and as the pilgrim found different sources of distraction before reaching the celestial city the route to convergence is as meandering, difficult and distracting. In this analysis I look at some of the road blocks which lie ahead before and if we are able to achieve full convergence of accounting standards.
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Transfer Pricing and Profit Planning a Fact of Business
March 28, 2011
G.E.'s Strategies Let It Avoid Taxes Altogether | www.nytimes.com
The referred article refers to proper tax planning by businesses while planning their operating portfolios across nations. The endeavor to take advantage of tax planning across borders is a centuries old tradition of business, wealth management and profit planning and management. In this analysis I take a look at how GE has apparently achieved a few extra heights in this endeavor.
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The Possible Effects of the Japanese Tsunami on International Accounting
March 21, 2011
Crises in Japan Ripple Across the Global Economy | www.nytimes.com
The Japanese Tsunami has brought about major economic and social effects apart from the nuclear crises and upheaval. In this analysis I look at how this could effect the development of global accounting standards.
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Possible Effects on Tax Policy of Recent Political Developments in India
March 18, 2011
India PM Denies Wikileaks Allegations | online.wsj.com
The Indian Government has been under tremendous pressure in respect of corruption allegations for the last one year. In this analysis I dwell on possible effects of these developments on changes in tax laws and tax administration.
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India Budget 2011 - Possible Impacts on International Companies
February 20, 2011
India Signs Tax Information Exchange Pacts to Avoid Tax Evasion | economictimes.indiatimes.com
The coming budget will in my view have a major impact on how international companies invest and divest in India. In this analysis I highlight some of the possible effects on this area of finance.
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India Budget 2011 - My Reading of Some Changes
February 18, 2011
Budget 2011 - Possible Questions and Answers FM faces | economictimes.indiatimes.com
February is the month in India when major changes in taxation and economic policies are announced every year. The budget this year will be no exception and I give below my expectations of some changes which in my opinion would be there.
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Executives Compensation and Derivatives - a constantly evolving complexity
February 6, 2011
Stock-Hedging Lets Bankers Skirt Efforts to Overhaul Pay | dealbook.nytimes.com
The recent financial turmoil brought out the risks inherent in investment. With restrictions being placed on compensation and more compensation in stock, executives resorted to complex derivatives to protect their interests. In this analysis I share my thoughts on some of the practices followed.
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Kerala High Court clears way for India's first Islamic Bank
February 3, 2011
Kerala High Court clears way for India's first Islamic Bank | timesofindia.indiatimes.com
A new source of finance based on profit sharing and principles of Islamic Law is set to enter India. The financial Institution is to be set up by the Government. The Government claims it will not be a Bank but a financial institution. In this analysis I look at some of the possible implications of the move.
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Convergence of Accounting Standards - Leasing, Fair Value, Revenue Recognition
January 31, 2011
The Path to Global Standards? | www.cfo.com
Convergence of Accounting Standards attracts heated debate and myriad questions. The referred article speaks of the manner in which FASB is addressing the issue and says that June 2011 is not sacrosanct for implementation and actual implementation may take longer. In the analysis below I highlight some of the aspects and give my views on the same.
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Islamic Banking - Sukuk - Lion Industries Antara Steel Offering
January 24, 2011
Lion Industries Antara Steel Plans RM300m Sukuk | www.theedgemalaysia.com
Islamic banking is fast evolving as a preferred source of finance in parts of the world. In India there are demands for introduction of Islamic Banking products. In this background the latest offering of Sukuk gives food for thought. The recent Dubai debt crisis was to some extent because of the absence of interest in Islamic banking products. In this context the growing popularity of Malaysian Islamic Banking products gives reason to think that these products will gain popularity in the future.
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Accounting Regulation and Frauds - A Welcome Proactive Indian Initiative
January 7, 2011
Accounting bodies to take swift action against guilty members | epaper.timesofindia.com
The referred article speaks of initiatives to be taken by Indian Accounting bodies against members who are accused of any professional wrongdoing. Coming in the wake of several scams - Satyam, Citibank, Telecom and a number of others in the Indian context this is a welcome development and should increase the respect and credibility of financial statements attested by Indian Accountants.
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Indian Tax Administration - Use of Tax Laws for Different Purposes
January 7, 2011
Taxman Visits Onion Traders | epaper.timesofindia.com
The referred article speaks of Tax Officials visiting Onion Traders in an effort to understand the onion trade and bring down onion prices. This even before the time has come for them to file any returns. In this analysis I take a look at how this kind of pressure is used by the authorities in India to exert pressure on trade and industry and the use of fiscal legislation for other purposes.
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Indian Taxation - Transfer Pricing - Tax Environment
December 17, 2010
I-T lens on 20k cr worth transfer pricing deals | epaper.timesofindia.com
The referred news item speaks of major transfer pricing tax demands being raised on Microsoft India (denied by the company) and also on a number of international banks operating in India. It also speaks of the rejection of the cost plus method in a number of transactions by the Indian Income Tax Department. In this analysis I look at the tax environment in India as related to corporate taxation for transnational companies doing business in this country.
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Indian Taxation - Vodafone - Twists in The Tale
November 14, 2010
Vodafone wants to settle tax row out of court - Dutch Govt. writes to India | economictimes.indiatimes.com
Ever since Vodafone took over the telecom business of Hutch in India, it has been faced with tax demands on the deduction of tax on the capital gains on the transaction earned by Hutch (the seller) but not deducted by the Indian entity. Vodafone has lost its appeals at the High Court level and is now fighting the case in the Supreme Court. In this analysis I look at the effects of the same on the factors which investors should keep in mind in the light of the same.
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The Gold Standard and Accounting Standards
November 8, 2010
Zoellick Seeks Gold Standard Debate | www.ft.com
The increasing price of gold in monetary terms has called into question the intrinsic value of currencies. The referred article is fairly quiet on the kind of debate which Mr Zoellick calls for on how the value of currencies should be fixed in relation to gold. In this analysis I highlight certain points which this brings to my mind in relation to accounting and accounting standards.
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