Transfer Pricing and the Financial Performance: The Case of Algerian Companies



Transfer Pricing, Financial Performance, Corporate Groups


The increase of international trade represents more than 60% of the international economy, which is more profitable within the same group, moreover the continuous search for satisfactory financial performance by companies. Through this research we investigate whether transfer pricing has a positive and significant impact on corporate group’s financial performance in Algeria, over a period of 5 years since 2016 with a quantitative approach and SPSS software. We tested the regression of transfer pricing variables (tax burden, firm size and leverage) with the financial performance of 60 companies of corporate groups operating on different sectors as a sample of this study. We found that transfer pricing has a significant and positive impact on those companies at 10% error’s margin, despite of the fact that only the firm size has a significant positive impact on ROA of these companies in Algeria with a margin error of 1%. However, we conclude that the more the company has a considerable size, the more it should pay attention to its transfer prices and their declarations to avoid any tax adjustment can hinder its financial performance. separate text which purpose when it is read in isolation from the rest of the work is to inform about its content. It should include such elements as the formulation of research objective, identification of study object, essence of used method, the most important results, and conclusions.



Received 2023-04-25
Accepted 2023-08-22
Published 2023-09-25