RSM424H1 Lecture Notes - Lecture 20: Accrual, Accounts Payable, International Business
11 Jun 2017
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Document Summary
The expansion of a canadian business enterprise into foreign markets is complicated because tax is imposed in the foreign jurisdiction as well as in canada. Ultimately, cash will flow from the foreign operations back to canada for reinvestment. Basic issues: there are two fundamental approaches to conducting foreign business operations: The foreign activity can be conducted from the home base in the form of direct export sales to consumers or distributors. The foreign activity can be conducted by developing a formal foreign structure that involves a physical presence in the foreign jurisdiction: formal structures can include the following: A separate foreign corporation as a subsidiary of the canadian parent corporation. A separate foreign joint venture, partnership, or limited partnership. An advanced, broadly based foreign structure that includes foreign holding corporations, finance companies, and sales and manufacturing entities: primary business structures for foreign expansion activities:
