CIAO DATE: 03/2015

Locating production and income within MNEs: An alternative approach based on formulary apportionment

December 2014

Columbia Center on Sustainable Investment

Abstract

Given the unique products and the complex global structure of some MNEs, the economic substance of transactions within MNEs is often subject to question under separate accounting. For statistical purposes, formulary apportionment is a viable alternative to separate accounting as a method for locating production and income within MNEs.

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