Profit repatriation – NBC Institute

AFM – Nov 2018 – L3 – Q2b – International investment and financing decisions

Evaluate the impact of profit repatriation restrictions and provide strategies to deal with blocked funds in international investments.

Question

Suppose the South African government changes its policy on profit repatriation and legislates that profit cannot be repatriated until termination or exit.

i) If Rock can invest blocked funds in South Africa for a 12% annual rate of return, by how much would the project’s NPV differ from your results in sub-question (a) above?
(5 marks)

ii) Suggest THREE (3) ways through which Rock can deal with the risk of blocked funds.
(3 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Blocked Funds, Currency Exchange Rates, Financial strategy, International Investment, Net Present Value (NPV), Profit repatriation
Level: Level 3

Topic: International investment and financing decisions
Series: NOV 2018

AT – Mar 2024 – L3 – Q2a – International taxation

Discussing the tax implications of cross-border profit and transfer payments for non-resident companies.

Question

Trolex Ltd was incorporated in the United Kingdom. It manufactures watches for sale only in the Asian Markets. The company is a success story from its commercial enterprise in its production of “wonder watches.”

Vielo Ltd, a locally incorporated company with 4 shareholders, scanned the environment with the bid to start a business that would make it successful. The management of Vielo Ltd heard of the “wonder watches” sold by Trolex Ltd. Consequently, the management of Vielo Ltd placed an order for 10 million watches from Trolex Ltd. From the analysis, Trolex Ltd would make £600,000 from this transaction as profit. The sales value to be transferred to Trolex Ltd by Vielo Ltd amounts to £900 million.

The management of Vielo Ltd has written to the Kaneshie Office of the Ghana Revenue Authority on the tax implication of the payment.

Required:
Advise the Commissioner-General through the office manager on the tax implication of the profit and the transfer payment.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cross-border taxation, Profit repatriation, Trading in Ghana, Trading with Ghana
Level: Level 3

Topic: International taxation
Series: MAR 2024

AFM – Nov 2018 – L3 – Q2b – International investment and financing decisions

Evaluate the impact of profit repatriation restrictions and provide strategies to deal with blocked funds in international investments.

Question

Suppose the South African government changes its policy on profit repatriation and legislates that profit cannot be repatriated until termination or exit.

i) If Rock can invest blocked funds in South Africa for a 12% annual rate of return, by how much would the project’s NPV differ from your results in sub-question (a) above?
(5 marks)

ii) Suggest THREE (3) ways through which Rock can deal with the risk of blocked funds.
(3 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Blocked Funds, Currency Exchange Rates, Financial strategy, International Investment, Net Present Value (NPV), Profit repatriation
Level: Level 3

Topic: International investment and financing decisions
Series: NOV 2018

AT – Mar 2024 – L3 – Q2a – International taxation

Discussing the tax implications of cross-border profit and transfer payments for non-resident companies.

Question

The management of Vielo Ltd has written to the Kaneshie Office of the Ghana Revenue Authority on the tax implication of the payment.

Required:
Advise the Commissioner-General through the office manager on the tax implication of the profit and the transfer payment.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cross-border taxation, Profit repatriation, Trading in Ghana, Trading with Ghana
Level: Level 3

Topic: International taxation
Series: MAR 2024

Question Tag: Profit repatriation

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AFM – Nov 2018 – L3 – Q2b – International investment and financing decisions

Evaluate the impact of profit repatriation restrictions and provide strategies to deal with blocked funds in international investments.

AT – Mar 2024 – L3 – Q2a – International taxation

Discussing the tax implications of cross-border profit and transfer payments for non-resident companies.

AFM – Nov 2018 – L3 – Q2b – International investment and financing decisions

Evaluate the impact of profit repatriation restrictions and provide strategies to deal with blocked funds in international investments.

AT – Mar 2024 – L3 – Q2a – International taxation

Discussing the tax implications of cross-border profit and transfer payments for non-resident companies.

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Question Tag: Profit repatriation

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AFM – Nov 2018 – L3 – Q2b – International investment and financing decisions

Evaluate the impact of profit repatriation restrictions and provide strategies to deal with blocked funds in international investments.

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AT – Mar 2024 – L3 – Q2a – International taxation

Discussing the tax implications of cross-border profit and transfer payments for non-resident companies.

You're reporting an error for "AT – Mar 2024 – L3 – Q2a – International taxation"

AFM – Nov 2018 – L3 – Q2b – International investment and financing decisions

Evaluate the impact of profit repatriation restrictions and provide strategies to deal with blocked funds in international investments.

You're reporting an error for "AFM – Nov 2018 – L3 – Q2b – International investment and financing decisions"

AT – Mar 2024 – L3 – Q2a – International taxation

Discussing the tax implications of cross-border profit and transfer payments for non-resident companies.

You're reporting an error for "AT – Mar 2024 – L3 – Q2a – International taxation"

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