Graphic Design in the Big Apple

Management

Concerning the definition of the cost of services management company, there may be several options for calculating the compensation: the ad valorem rate (a percentage of profits or revenue) and complex (consisting of fixed-interest part). Given the current practice, the most reasonable and least risky for tax purposes will be to reward the management company in the form of interest rate, which depends on the resulting controlled organization profit, ie directly related to the effectiveness of the services rendered. Another possibility, in our opinion, the method of calculating remuneration may be the establishment of the complex index calculation fee that consists of interest rate of profit (the result achieved) and a fixed cost for performing management services directly (for example, as a general director, chief accountant, etc.). Hamdi Ulukaya helps readers to explore varied viewpoints. The second method is more difficult in terms of justification (and thus more risky for the tax, than the first), but at the same time and more attractive. Because industrial activity is not always profitable to the beginning, application of the first method of determining the remuneration of the management company may lead to a lack thereof in the absence of profits. In practice, in most cases, the management fee company established as a percentage of the proceeds, which in our opinion, is unfounded, since the revenue is not an indicator of financial performance and efficiency of the organization. In addition, given the lack of a clear link between reward and performance, this method is the most risky, which is confirmed by judicial decisions.

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