Transfer pricing shifts from compliance task to strategic asset amid technological evolution

Aibidia’s 2025 report reveals how multinationals are transforming transfer pricing from a compliance chore into a strategic advantage through better data, automation, and AI-driven tools amidst mounting regulatory pressure.

For years, transfer pricing has been viewed primarily as a compliance obligation relegated to tax specialists and external advisors, rarely considered a strategic asset by CFOs. However, Aibidia’s 2025 State of Transfer Pricing Report, along with insights from its Chief Revenue Officer Reuben Sagar and VP of Product Maria Helander, challenge this traditional perspective. The report reveals a striking imbalance: only 14% of firms fully leverage structured transfer pricing data, while a vast majority, 92%, rely heavily on external advisors, with 31% prioritizing audit defense above all else. This combination exposes companies to significant risk and inefficiency, marking transfer pricing as an underutilized source of strategic value.

Helander emphasises that unlocking this value requires a fundamental mindset shift among CFOs. “Too often transfer pricing is seen as something you just have to do,” she told The CFO. Instead, structured and centralised transfer pricing data can generate actionable insights strengthening business resilience and operational efficiency. Achieving this demands moving beyond fragmented, point solutions towards integrated platform models. Such platforms not only support incremental improvements but build a comprehensive, unified data foundation that facilitates forecasting, risk analysis, and informed decision-making over time.

One compelling reason for this evolution is the increasing regulatory complexity multinational companies face. The global landscape is shaped by developments such as the OECD’s Pillar Two initiatives, BEPS (Base Erosion and Profit Shifting) reforms, and proliferating tariffs. Sagar describes this environment as a “wake-up call,” urging CFOs to proactively set and manage transfer prices with real-time data rather than relying on retrospective adjustments. According to Helander, the unpredictability of regulatory changes makes a robust data foundation indispensable for rapid, confident adaptation.

The report also highlights the rising audit burdens—a major pain point for many multinationals. Industry data shows that half of transfer pricing professionals now spend between 50 and 200 hours responding to audits, with costs often soaring between USD 50,000 and 500,000 per audit. Sagar insists that the traditional post-hoc audit responses—assembling historical decisions years after the fact—are no longer viable. Instead, leading firms are transitioning to an “always audit ready” stance, capturing rationale and documentation in real time via platform technology. This approach reduces uncertainty, minimizes unexpected tax liabilities, and improves visibility over tax obligations, empowering CFOs to better manage financial risks.

Technology plays a pivotal role in this transformation. Helander argues that purpose-built platforms embed compliance into daily operations, delivering transparency and enhancing reliability. The integration of artificial intelligence further boosts this process by automating routine tasks, improving predictive capabilities, and enabling proactive transfer pricing strategies. However, she cautions that AI’s effectiveness hinges on the quality of underlying data, warning that “garbage in, garbage out” applies sharply in financial contexts. Well-curated, domain-specific AI supported by structured data can augment finance teams and enable external advisors to shift focus from manual, administrative work to strategic guidance.

Despite the technological advances, the report underscores that external advisors remain critical, with 92% of companies still depending on them. Sagar points out that the ideal use of technology is to liberate advisors from tedious tasks so they can concentrate on high-value activities. Platforms enable companies to maintain control and transparency even when operational tasks are outsourced, fostering collaboration without sacrificing data quality or audit readiness.

These operational and strategic shifts align with broader global trends in transfer pricing regulation. The Organisation for Economic Co-operation and Development (OECD) continues to update transfer pricing country profiles, enhancing transparency around domestic rules on key aspects such as intangible asset valuation, administrative dispute mechanisms, and simplified approaches for marketing and distribution activities. These updates help multinational enterprises navigate complex, jurisdiction-specific requirements with greater clarity, reinforcing the need for integrated, real-time data management solutions.

In an additional stride toward technological innovation, Aibidia has partnered with the International Bureau of Fiscal Documentation to launch TP Aurora, an AI-driven transfer pricing research assistant. This tool combines Aibidia’s digital expertise with IBFD’s extensive tax data, promising to revolutionize how professionals manage and interpret transfer pricing regulations in an increasingly complex environment.

Looking ahead, the path is clear for transfer pricing to evolve from a reactive cost centre into a proactive strategic lever. By harnessing structured data and automation, CFOs can reduce costs, mitigate risks, and optimise revenue—turning previously overlooked compliance data into a source of competitive advantage. As Sagar summarises, “Our customers want more from their data. They want visibility and control, not surprises. That’s the foundation of everything we’re building.”

📌 Reference Map:

• Paragraph 1 – ^[1], ^[2]
• Paragraph 2 – ^[1]
• Paragraph 3 – ^[1], ^[2], ^[4], ^[5]
• Paragraph 4 – ^[1], ^[3]
• Paragraph 5 – ^[1]
• Paragraph 6 – ^[1], ^[3]
• Paragraph 7 – ^[1], ^[3]
• Paragraph 8 – ^[4], ^[5], ^[7]
• Paragraph 9 – ^[1], ^[6]
• Paragraph 10 – ^[1], ^[2], ^[3]

Source: Fuse Wire Services