Which one of the following cash flow mechanisms arouses the least suspicion from a host government concerning multinationals attempts to avoid additional taxes?
A) transfer pricing
B) reinvoicing centers
C) royalties
D) leading and lagging

Question

Quizplus · Accepted Answer

Leading and lagging involve timing the payments of obligations to take advantage of favorable currency movements or interest rates, which is generally seen as a legitimate financial management practice rather than a tax avoidance strategy.

Which One of the Following Cash Flow Mechanisms Arouses the Least