If you cannot give me a yes or no, but just repeat the question and say that is what it is, that to me is a yes.

We need aggressive enforcement.

Are they rules of the IRS or is it our rules that need to be changed?

It is also true that----

What is the justification for that except to save tax money? And that is perfectly legitimate, right?

The IRS has broad authority in other respects under Section 482 with respect to companies under common control.

Can't you give some guidance, though, to people?

Are there more than a handful in the last few years that have gone to trial on transfer pricing issues?

That is all right. I think that is as much as we are going to get on that one.

Is it not then in Microsoft's tax interest in terms of reducing its taxes to enter into an agreement which has little coming back to the United States?

If there were a problem here in the misuse of this assertion, in fact, it is being used routinely to avoid the disclosure in that report in APB 23.

Our code is far too complex, and I also agree that the fact that you try to lower your taxes is not illegal in and of itself.

Take a look at Exhibit 3c, would you?

But the absence of an accounting standard to guide people, is not troubling to you when your job is to put out standards?

Would you agree that if this were one pool it would not comply with Section 956?

And the IRS should aggressively require that.

When and how much of the offshore cash pools would be utilized closely coordinated by both of those offices?

America stands on the edge of a fiscal cliff, and this challenge lends new urgency to a topic that this Subcommittee has long investigated.

Loss of tax revenue is a key cause of the problem. Shifting of profits offshore by multinational corporations is a major contributor to that problem.

I think it is highly dubious, frankly, that the loan program complies with our current tax law.

I understand. In order to avoid the application of Section 956, these were guidelines.

You just said there could be a loan from one.

Are those kind of facts relevant to an examiner? That is a pretty straightforward question.

I believe that you said, Mr. Ezrati, that you did not depend heavily upon these funds for your liquidity.

Does that not create a presumption that this is obviously not a fair price that is being paid?