Financing & treasury
Group treasury policy
A group treasury policy sets out consistent principles for how a corporate group manages intercompany financing, cash pooling, guarantees, and hedging, providing a documented framework that supports consistent arm's length pricing decisions across jurisdictions rather than ad hoc arrangements negotiated separately by individual.
Beyond operational efficiency, a well-drafted policy strengthens transfer pricing defence by demonstrating that pricing decisions follow an established, principled methodology rather than being reverse-engineered after the fact to achieve a particular tax outcome, which tax authorities are increasingly quick to identify and.
An effective policy typically covers credit rating methodology, comparable data sources, cash pool leader remuneration principles, guarantee fee approaches, and a schedule for periodic refreshes, giving finance and tax teams a single reference point when new intercompany financing arrangements are proposed or existing ones are.
In practice
What matters when applying group treasury policy
- Set consistent principles across all intercompany financing types
- Cover credit rating methodology and comparable data sources
- Define cash pool and guarantee fee pricing approaches
- Schedule periodic refreshes of rates and methodology
- Use the policy as the single reference point group-wide
Frequently asked
Common questions
Why does a group need a treasury policy?+
To ensure consistent, principled arm's length pricing decisions across jurisdictions and financing types, rather than ad hoc arrangements negotiated separately that are harder to defend under audit.
What should the policy cover?+
Credit rating methodology, comparable data sources, cash pool and guarantee fee pricing approaches, and a schedule for periodically refreshing rates as market conditions change over time.
See how the tooling handles this in practice
Our transfer pricing tools calculate intercompany charges, benchmark financing and reconcile the intercompany ledger from your own data. Book a short walkthrough and we will show the workflow on a scenario that matches your group structure, rather than a generic demo dataset.