Abstract

Transfer prices have to assign the value to the services or goods exchanged between the units of a firm or of a group in order to properly manage the interdependencies between them. The method and the criteria determining the value of trades should therefore be defined so as: to push the single unit to act according to the logic of the firm towards the achievement of its objectives, to calculate correctly the economic performance of the units and to be perceived correct by those who work within them. The paper gives evidence to the issues that concern the determination of transfer prices based on cost and, through the case study of DHL Express Italy, analyzes the accounting and managerial implication of transfer prices determined by activity based costing and the relevance for prices decisions.