Unbundling of funds by an MNE may be a useful practice for which of the following reasons?
A)An increase in the funds flow (charges)in any of the before-tax categories reduces the taxable profits of the foreign subsidiary if the host-country tax authorities acknowledge the charge as a legitimate expense.
B)An item-by-item matching of remittance to input, such as royalties for intellectual property, and fees for patents and advice, is equitable to the host country and foreign investor alike.
C)Unbundling facilitates allocation of overhead from a parent''s international division, so-called shared services, to each operating subsidiary in accordance with a predetermined formula.
D)All of the reasons listed above

Question

Quizplus · Accepted Answer

Unbundling of funds by an MNE may be a useful practice for all the reasons listed above. It can help reduce taxable profits by acknowledging legitimate expenses, ensure equitable distribution of remittance to inputs, and facilitate allocation of overhead costs to subsidiaries following a predetermined formula.

Unbundling of Funds by an MNE May Be a Useful