《Management Accounting》ch11.pptVIP

Comparable uncontrolled price method Resale price method Cost-plus method The IRS allows three pricing methods that approximate arm’s-length pricing (shown in the order of preference): Questions to Ask Concerning Ethics in the International Environment Is the action right legally? Is the action right morally? The End Chapter Fourteen 14 -* International Issues in Managerial Accounting CHAPTER 1. Explain the role of the management accountant in the international environment. 2. Identify the varying levels of involvement that firms can undertake in international trade. 3. List the ways management accountants can manage foreign currency risk. 4. Explain why multinational firms choose to decentralize. Objectives 5. Describe how environmental factors can affect performance evaluation in the multinational firm. 6. Discuss the role of transfer pricing in the multinational firm. 7. Discuss ethical issues that affect firms operating in the international environment. Objectives Where does the management accountant fit into the global business environment? Business looks to the management accountant for international financial and business expertise. Management Accounting in the International Environment Skills needed by management accountants Politics Economics Marketing Management Information Systems Technology Multinational Corporation (MNC) A multinational corporation (MNC) is one that “does business in more than one country in such a volume that its well-being and growth rest in more than one country.” Importing and Exporting Importing is the process of bringing product in from a foreign country. Exporting is the process of shipping product to a foreign country. Foreign trade zones are areas near a customs port of entry that are physically on U.S. soil but considered to be outside U.S. commerce. Foreign Trade Zones Example: San Antonio Example: New Orleans Example of the Advantages of Operating a Plant in a Foreign Trade Zone Roadrunner, Inc. operates a petrochemical pl