Guide · Local File · 3 min
Local File and Master File: how the documents fit together
Understand the group-wide context, the local transaction analysis and the checks that connect them.
01
The Master File sets the group context
The Master File provides an overview of the multinational group's business and transfer pricing arrangements. It describes the wider setting in which group entities operate, including the organisational structure, activities, intangibles and financing.
02
The Local File examines the relevant transactions
The Local File provides more detailed information about the local entity and its material intercompany transactions. It connects the facts and functional analysis to the selected method, financial information and conclusion. It should be consistent with the group context while explaining the local circumstances.
03
Check the connection before review
- Do both documents describe the same group structure and business model?
- Do the agreements, transaction amounts and financial information reconcile?
- Have changes in activities or responsibilities been explained?
- Are missing information and review questions clearly identified?
04
Agree the documentation scope
Applicable requirements and deadlines must be checked for the relevant jurisdiction and reporting period. Country-by-Country Reporting is a separate element of the OECD documentation framework; a Local File or Master File does not replace it.
For a Dublon assignment, agree which document or analysis is needed, what information the client will provide and who will review it. The outcome should help the responsible adviser explain and assess the position.
Further reading
Continue the review