Executive answer
Executing an adjustment requires consistency among calculation, nature, document, accounting, settlement and filing. The annual rules provide that an adjustment retains the concept of the underlying dealing. A service true-up should not be booked as generic expense; a goods adjustment should connect with inventory or cost; a financial adjustment with interest; a royalty with the right and base.
An electronic invoice alone creates neither a deduction nor arm’s length support. A technical calculation does not replace a tax document or materiality. The file should explain why an adjustment exists, how the amount was determined, which document applies, which account changes, how the counterparty recognizes it and where it is reported.
Before issuing, classify real or virtual treatment and variant, analyze taxes and confirm timing. A virtual adjustment may not require a document changing consideration; issuing one could contradict the classification. A real adjustment requires coordination and may affect balances, settlement, VAT, withholding and customs.
Correct sequence
- Close population and segment.
- Approve benchmark and applicable point.
- Calculate difference and cause.
- Classify real/virtual and variant.
- Confirm original nature.
- Analyze income tax, VAT, withholding, excise and customs.
- Select document and date.
- Design entry and counterparty treatment.
- Issue, post and settle.
- Recalculate the indicator and file.
- Archive evidence and approval.
Do not begin by asking the group for an invoice. The document is the consequence of a decision, not its basis.
Execution package
| Item | Content | Owner | Control |
|---|---|---|---|
| Memorandum | Facts, rule, classification | Tax | Approved before issue |
| Calculation | Data, range, formula, currency | TP/controller | Reproducible |
| Agreement | Clause and period | Legal | No backdating |
| Document | Invoice/note/foreign invoice | Accounting | Correct nature |
| Entry | Account, counterparty, taxes | Accounting | Complete reference |
| Settlement/balance | Date, currency, netting | Treasury | Agrees to document |
| Counterparty | Entry and confirmation | Global team | Symmetry explained |
| Return | Field, amount and version | Tax | Reconciled |
| Evidence | Service, goods, loan or right | Operations | Materiality |
| Approval | CFO and functions | Leadership | Date and scope |
Original nature
Identify the dealing modified. For services, state provider, recipient, activity, base and markup. For goods, product, units, invoices, inventory and customs entries. For loans, principal, period, rate and withholding. For royalties, intangible, territory, sales and rate.
An aggregate adjustment may cover several dealings only when method and document preserve traceability. Otherwise separate by nature, counterparty and period.
The account, document description and filings should use the same characterization. Internal abbreviations may retain a reference but do not replace the description.
Electronic and foreign documents
Determine under current invoicing rules whether an income invoice, credit note, related document, supplement or another record is required. For a foreign counterparty, retain the invoice or record satisfying applicable Mexican requirements and link it to Mexican books.
Use UUID or identifier, date, currency, exchange rate, period and relationship to original documents. Where several invoices exist, preserve an allocation schedule.
Do not select a product/service code merely because the system accepts it. Validate nature and tax. Control cancellations, replacements and acceptance.
Before issuing or accepting a foreign document, have tax, accounting and indirect-tax teams approve one execution sheet.
Journal entry
The entry should modify the corresponding economic account. An inventory-price adjustment may affect stock on hand and sold cost; a service adjustment, expense or income; finance, interest. Assess cut-off and closed statements.
Include related counterparty, currency, type, tax, UUID or invoice, agreement, calculation and approver. Attach support under policy.
Reconcile local and group books. Explain differences in standards, currency or date through a bridge rather than erasing them.
Inventory and cost of sales
For goods, determine which units were sold and which remain. Allocate the adjustment on a reasonable basis. Posting everything to cost of sales can distort inventory and periods.
Connect customs entries and value. A commercial credit note does not automatically amend a customs declaration. Obtain customs review.
Confirm that the recalculated margin uses the final accounting treatment.
Services and materiality
The document should relate to services actually performed. Retain outputs, requests, beneficiaries, costs, key and acceptance. A true-up cannot cure a charge without substance.
Where base or markup changes, show both. Separate pass-through items. Allocate to recipients and periods.
Review withholding and VAT according to source, nature and counterparty. Not every management fee has identical treatment.
Financing
An interest adjustment requires principal, days, base rate, spread, currency and schedule. Determine whether accrued, paid or capitalized interest changes. Review withholding and limitations.
Reconcile the entry with bank records and agreement. A closing document cannot cure debt characterization without analysis.
Coordinate treasury and counterparty to prevent different balances.
Virtual adjustment
Where the effect is tax-only, the main support is the workpaper: books, reconciliation, difference, rule, filing and approval. Do not issue a fictitious invoice or create a balance.
The tax reconciliation should be traceable and retain the original nature. Determine temporary or permanent difference and informational accounting effects.
If consideration changes later, reassess classification; do not mix stages without versioning.
Exchange rate
Define the currencies of dealing, document, accounting and filing. Record source and date of the applicable rate. The counterparty may use another functional currency.
Separate the adjustment’s economic difference from subsequent FX. Do not recalculate arbitrarily to force symmetry.
Show original amount, currency, rate, pesos and settlement.
Date and period
Associate the adjustment with the fiscal year and tested dealing. Document, accrual, entry, settlement and filing dates may differ. Prepare a chronology.
Do not backdate an agreement, invoice or approval. If found later, follow the current amended-return, requirement and notice route.
Control cut-off: documents received after closing need formal review.
Counterparty
Send an execution sheet containing amount, currency, nature, period, documents and expected accounts. Request confirmation of posting and tax treatment where relevant.
Reconcile balances and payments. Where one party posts and the other does not, document the difference and risk. For cross-border dealings, assess double taxation; for domestic, consistent returns.
Avoid netting several dealings without contractual and tax support.
Returns
Map annual return, provisional payments, Annex 9, Local File, ISSIF, SIPRED, VAT, withholding and customs. Not all apply; preserve the conclusion.
Every field should trace to the entry and calculation. Retain before-and-after versions and receipts. Explain amended returns.
The final transfer pricing report should use the executed numbers, not an approved draft that later changed.
Pre-issue checklist
- Method and range approved.
- Result recalculated.
- Cause documented.
- Classification confirmed.
- Nature identified.
- Agreement reviewed.
- Taxes analyzed.
- Document defined.
- Entry designed.
- Counterparty aligned.
- Deadline confirmed.
- Owners approved.
An open item needs a decision, not an assumption.
Common errors
- Issuing a generic “TP adjustment.”
- Invoicing before classification.
- Posting all goods adjustment to expense.
- Ignoring inventory.
- Accepting a foreign invoice without a schedule.
- Using inconsistent exchange rates.
- Creating an invoice for a virtual adjustment.
- Failing to confirm the counterparty.
- Reporting draft amounts.
- Losing the filed version.
Quality control
The Adjustment Execution Pack contains the sheet, calculation, agreement, document, entry, tax, settlement, counterparty, returns and evidence. A reviewer traces in both directions.
Tax, accounting, legal, treasury, indirect tax and customs approve their sections. The CFO authorizes the package.
Reverse and forward tests
Select the reported amount and trace it backward through entry, document, calculation, range and source data. Then select an original invoice and trace forward to the adjustment and every return. The first test addresses support; the second completeness.
Repeat for a sample of goods, services and financing where present. For goods, include customs entry and inventory; for services, deliverable and allocation key; for interest, principal and withholding. Record time and differences.
Someone outside preparation should reproduce the amount. If oral explanations or personal folders are required, the package is not closed.
Rejection scenarios
Reject issuance where the document changes nature, the agreement does not identify the period, the counterparty does not confirm the amount, the entry ignores inventory or the calculation does not reach the indicator. Reject as well where indirect tax or customs has an unresolved material question.
Rejection need not cancel the adjustment: return it to the owner with an action and deadline. Maintain an open-item list and obtain a new approval. This keeps closing urgency from turning a technical gap into an irrevocable document.
Execution master file
Use one index and adjustment ID. Link versions and mark the issued/filed version. Preserve hashes or change controls under policy. Lock the approved calculation and save corrections as new versions.
The final sheet should show approved, issued, booked, paid and reported amounts; every difference needs a reason and owner.
Related topics
- PT-015: evidence retention.
- PT-026 and PT-027: decision and classification.
- PT-029 and PT-030: effects and notices.
End-to-end execution test
Before issuing an electronic invoice or equivalent document, connect the approved calculation, adjustment nature, agreement, counterparty, period, currency and taxes. Define wording and references that identify the transaction without generic descriptions. Accounting prepares an entry with consistent accounts; treasury confirms payment or offset; tax validates affected returns.
Run a controlled test where the ERP or invoicing system uses new rules. Review sign, exchange rate, VAT, withholding, date and link to the original invoice. After posting, reconcile both parties’ subledgers and update the study, DIM appendix, Local File, ISSIF or SIPRED as applicable.
The final package retains approvals, calculation, invoice files, entry, payment, reconciliation and receipts. A second reviewer reconstructs the amount without personal files. A technically strong benchmark loses value where operating documents describe a different transaction.
Sources and verification date
Thirty days later, sample the posting and confirm that the electronic invoice was not cancelled, replaced or accounted for differently. Verify payment, offset and counterparty recognition. This follow-up finds interface failures that issuance-day validation cannot observe. Close each exception only after accounting and tax agree on the corrected evidence.
- 2026 Miscellaneous Tax Resolution, section 3.9.1 and applicable invoicing rules.
- Mexican Federal Tax Code, current text, Articles 28, 29 and 29-A.
- Mexican Income Tax Law, current text, Articles 27, 76, 179 and 180.
Sources checked on August 2, 2026. The precise document depends on nature, counterparty, year and current rules. This article does not replace a transaction-specific review.
Revalidate the package whenever the issued document, tax treatment, posting date or counterparty entry changes before filing.
Record the reviewer, decision date and final supporting-document location as well.
Request an Adjustment Execution Pack to align calculation, invoice or foreign document, entry, counterparty, taxes and returns.