This article focuses on the expenditure side of the financial statements and unveils what transfer cost and trade mis-invoicing are, and how those transactions are hurting Liberia. Transfer cost is the total opportunity cost of moving an item from one place to another, including transport costs, loading and unloading costs, and administrative costs. The transfer cost becomes a trade misinvoice when the price or value attached to that equipment is not fair to the Liberian company. The tax authorities in Tanzania however, will not normally grant tax deductible capital allowances for that same machine anymore because the revalued cost is simply an accounting cost, not a financial cost. Transfer cost and trade misinvoicing must be curtailed if we are to stop illicit financial flows and derive just and fair compensation for our natural resources.

Source: Daily Observer April 05, 2018 02:18 UTC