5.3.4.5.1.1 Availability of Transfer Pricing Methodologies
The availability of Transfer Pricing Methodologies depends on the data source that you select: Account Table or Ledger Table.
The following table describes the Transfer Pricing Methodologies available
for each of these data sources and displays whether that methodology requires the
selection of a Transfer Pricing Interest Rate Code.
Note:
The Interest Rate Code LOV is filtered by the selected Currency.Table 5-19 Transfer Pricing Combinations
| Transfer Pricing Methodology | Data Source: Account Table | Interest Rate Code | Behavior Pattern | Holiday Calendar |
|---|---|---|---|---|
| Do Not Calculate | Yes | |||
| Cash Flow: Average Life | Yes | Yes | Yes | |
| Cash Flow: Duration | Yes | Yes | Yes | |
| Cash Flow: Weighted Term | Yes | Yes | Yes | |
| Cash Flow: Zero Discount Factors | Yes | Yes | Yes | |
| Moving Averages | Yes | Yes | ||
| Straight Term | Yes | Yes | ||
| Spread from Interest Rate Code | Yes | Yes | ||
| Spread from Note Rate | Yes | |||
| Redemption Curve | Yes | Yes | ||
| Tractor Method | Yes | Yes | Yes | Yes |
| Caterpillar | Yes | Yes | Yes | |
| Weighted Average Perpetual | Yes | Yes | Yes | |
| Unpriced Account |
Note:
Not specifying assumptions for a node is not the same as selecting the Do Not Calculate Methodology. Child nodes for which no assumptions are specified automatically inherit the methodology of their closest Parent node. Therefore, if neither a Child node nor its immediate Parent has a method assigned, the application searches up the nodes in the hierarchy until it finds a Parent node with a method assigned, and uses that method for the Child node. However, if no Parent node has a method assigned then the application triggers a processing error stating that no assumptions are assigned for the particular product/currency combination. However, if the Parent node has the method Do Not Calculate assigned to it then the Child node inherits Do Not Calculate, obviating the need for calculation and for a processing error.