Globalisation and “tiering” of A&D customers and the supply chain

Buyers of A&D products are increasingly international. Buyers are governments, quasi-government organisations and private entities. Each type of buyer has unique policies, objectives and restrictions. Suppliers, on the other hand, are located throughout the world and are increasingly emerging from Asia. Large A&D companies establish special purpose entities such as joint ventures, partnerships and proxy boards to qualify as suppliers in foreign countries and to meet offset requirements.

The current international issues include: controls over the restrictions on import/export of technology and products; risks of establishing business operations in foreign countries; accounting and tax complexities associated with special purpose entities and cross-border affiliated transactions; reinvestment and repatriation of profits and other A&D-specific accounting and tax issues associated with multinational operations.

How PricewaterhouseCoopers can help you

We understand the global environment in which you operate and therefore have broad-based, cross-functional capabilities and the global reach necessary to help our A&D clients execute cross-border transactions and mitigate risk. Some of the many areas in which our industry experts are qualified include: shared services and outsourcing, transaction services and strategy, export controls, and IT effectiveness. Specifically from a tax perspective, our A&D experts understand how transfer pricing strategy and documentation, R&D costs, intellectual property management, expatriates, global payroll, treasury strategies, and mergers, acquisitions and divestitures impact your tax planning and compliance requirements around the world.