The economic downturn triggered by the COVID-19 pandemic is affecting wide swathes of sectors and companies. In particular, the treasury departments of multinationals have needed to boost their liquidity levels to cope with this unstable economic environment and meet their short- and medium-term financial obligations.

Treasurers have a range of strategies at their disposal to address liquidity issues. These include, for instance, reducing overhead costs, eliminating unproductive assets and refinancing debt, as well as adjusting working capital, modifying debt terms, or using a cash pool. However, many of these strategies trigger transfer pricing consequences that shouldn’t be ignored.

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