Local File Checklist

Local File
Checklist
Transfer Pricing Local
File Checklist
Welcome to the Local File Checklist, your comprehensive

tool designed to simplify the complex task of preparing
transfer pricing documentation.
This tool is created to make your task of preparing or

reviewing local file less overwhelming and more efficient,
ensuring your documentation meets both content and
presentation standards.
Local File Checklist | 2

This section focuses on refining the presentation and accuracy aspects of your local file. It helps
ensuing proper formatting of all elements of the document, such as abbreviations, table of contents,
graph labeling, and citation formats.
Formatting Review
Abbreviation
Explanation Yes No
Consistency
Abbreviation
Ensure abbreviations are used consistently throughout the document
Consistency
Table of Contents Confirm that the table of contents is up-to-date with correct page numbers
Graphs Labelling Verify all graphs, charts, and diagrams are labeled and referenced in the text
Confirm all tables have correct numbering, titles, and are accurately
Table Labelling
referenced in the text
No Tables Broke Ensure figures and tables do not break across pages unless absolutely necessary
Citation Check Check for proper citation formatting for all referenced sources
Footnote Format Verify all necessary footnotes are present and correctly formatted
Confirm financial figures follow a consistent format (e.g., currency signs, use
Number Formatting
of commas/periods)
Hyperlinks Verification Ensure all hyperlinks or URLs are functioning and direct to the correct webpage
Confirm headings and subheadings are correctly and consistently used to

Heading Consistency
separate different sections
Margin Compliance Check the document follows the correct margin guidelines
Alignment Consistency Ensure text alignment is consistent throughout the document
Spacing Uniformity Check line spacing is uniform across the document
Blank Spaces Confirm there are no blank pages or unnecessary spacing between sections
Font Uniformity Ensure consistent usage of typefaces and font sizes throughout the document
Color Scheme Check the document follows the color scheme, if applicable, for better
Adherence legibility
Language Accuracy Verify spellings, grammar, and punctuation are correct and consistent
Appendix Reference Confirm appendices are labeled and referenced appropriately within the document
Legal References Check legislation and OECD references are correct and up-to-date
Confirm financial figures (such as transactional values, PLIs, etc.) are in line
Numbers Accuracy
with source files

This section provides a comprehensive list that covers every crucial point your local file should address.
From articulating your legal entity business to ensuring consistent alignment with other reporting forms,
this section provides a detailed guide to make your local file content-rich and fully compliant.
Content Review
Review Criteria Description Yes No
Transactional Detailed account and figures of the controlled transactions during the year,
Overview with explanation of their substance, is provided
Identification and substantiation of the functions, risks, and assets of the

Functional Analysis
local entity and its counterparties
Intercompany List of the intercompany agreements affecting transactions and explanation

Agreements of their implementation is provided
Transfer Pricing Description of the local entity's transfer pricing policy relevant for controlled
Policy transactions and the company's pricing practices is provided
Transfer Pricing Selected OECD/local transfer pricing method(s) are stated and their
Method appropriacy is justified, with explanation on why others aren't applied
Comparability Explanation of the process of comparability analysis, the relevance of the

Analysis selected comparables, the database choice, and filters applied is provided
Reliability and alignment of financial data used for transfer pricing analyses
Financial Information with the entity's financial accounts is confirmed, with demonstration of its
tie to the P&L/balance sheet
Description and justification of any pricing adjustments made, with

Pricing Adjustment
explanation of their reflection in financial accounts, is provided
Arm's Length Verification of whether the controlled transactions outcome aligns with the
Confirmation arm's length principle and justification of belief is provided
Country-Specific
Compliance of the local file with any specific country rules is confirmed
Rules
Counterparty Local Comparison of this local file with the counterparty’s file and explanation of
File any differences is provided
Assurance that the local file presents a clear and convincing story that
Story
arrangements are at arm's length
Consistency Assurance that the local file aligns with TP forms, CbCR, and master file

OECD Local File Requirements
Management structure and business strategy, highlighting recent significant changes.
List of key competitors.
Brief overview of controlled transactions.
Summary of intra-group payments/receipts per transaction type and tax jurisdiction.
List of associated enterprises in transactions.
Copies of material intercompany agreements.
Summary of comparability and functional analysis, noting year-to-year changes.
Identified transfer pricing method with justification.
Identification of tested party and reasoning.
Summary of key assumptions in methodology.
Justification for multi-year analysis, if relevant.
Overview of comparable transactions and related financial indicators.
Summary of comparability adjustments made.
Justification for arm’s length pricing of transactions.
Summary of financial data used in methodology.
Copies of relevant APAs and other tax rulings.
Annual financial accounts of the local entity.
Schedules linking financial data with annual financial statements.
Summary schedules of financial data for comparables.

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Local File

Welcome to the Local File Checklist, your comprehensive

This tool is created to make your task of preparing or

Local File Checklist | 2

Confirm headings and subheadings are correctly and consistently used to

Alignment Consistency Ensure text alignment is consistent throughout the document

Spacing Uniformity Check line spacing is uniform across the document

Local File Checklist | 3

Identification and substantiation of the functions, risks, and assets of the

Intercompany List of the intercompany agreements affecting transactions and explanation

Comparability Explanation of the process of comparability analysis, the relevance of the

Description and justification of any pricing adjustments made, with

Local File Checklist | 4

Management structure and business strategy, highlighting recent significant changes.

List of key competitors.

Brief overview of controlled transactions.

Summary of intra-group payments/receipts per transaction type and tax jurisdiction.

List of associated enterprises in transactions.

Copies of material intercompany agreements.

Summary of comparability and functional analysis, noting year-to-year changes.

Identified transfer pricing method with justification.

Identification of tested party and reasoning.

Summary of key assumptions in methodology.

Justification for multi-year analysis, if relevant.

Overview of comparable transactions and related financial indicators.

Summary of comparability adjustments made.

Justification for arm’s length pricing of transactions.

Summary of financial data used in methodology.

Copies of relevant APAs and other tax rulings.

Annual financial accounts of the local entity.

Schedules linking financial data with annual financial statements.

Summary schedules of financial data for comparables.

Local File Checklist | 5

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