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46 • GOVERNANCE AND MANAGEMENT
PANDORA ANNUAL REPORT 2016
TAX
Description
PANDORA operates globally with a vertically
integrated supply chain organisation and by
nature therefore has a significant number of
intercompany transactions, which are subject
to tax legislation that is complex and open to
interpretation.
At PANDORA, we put a great deal of effort
into complying with local tax legislation, but
we also recognise that situations may arise in
which the tax authorities’ understanding of
how the legislation should be applied differs
from ours.
Risk
Therefore the risk for PANDORA implies:
• local authorities may challenge our set-up
• entering new markets
• internal compliance, systems and processes
on tax may fail
• different interpretations of the Board of
Investment (BOI) agreement in Thailand
Actions taken
• Transfer pricing settlement made with
the Danish tax authorities, incorporating
transfer pricing principles for a significant
part of PANDORAs transactions
• Ongoing dialogue with tax authorities in all
relevant markets
• Global Group tax risk identification and
management process
• Publishing Group Tax Policy on Group
website
MAJOR MARKET DEPENDENCIES
Description
As we in PANDORA sell our products globally,
we have a number of significant markets that
are important to our growth and earnings. Single
market developments have a significant impact on
Group results.
Our major markets have experienced solid
growth for a substantial period. To sustain our
Group growth, we are therefore dependent on:
• continued access to our major markets
• continued positive development in all major
markets
Major markets constituting 5% or more of
the Group’s revenue include the US, Canada,
the UK, Italy, France, Germany, China and
Australia.
Risk
Therefore the risk for PANDORA implies a
potential impact on revenue should one or
more of our major markets decline.
Actions taken
• Quarterly business review meetings
• Monthly management reports
• Market-specific strategies developed
• Strong focus on developing PANDORA’s
jewellery brand in all our markets