The paper proposes a power flow control strategy for a P2 parallel plug-in hybrid electric vehicle (PHEV) which takes into account torque and power losses related to engine-on and gear shift transients. An extended backward-looking (EXT-BWD) model is proposed to account for the transient losses, while the control strategy combines a rule-based controller with an equivalent consumption minimization strategy. To describe the transient losses, the EXT-BWD model includes additional state variables related to engine on/off flag and gear ratio in the previous time step. To establish a performance benchmark for control strategy verification, a dynamic programming-based control variable optimization framework is established based on the EXT-BWD model. The proposed control strategy is demonstrated to improve the fuel efficiency and drivability compared to the original control strategy while retaining comparable computational efficiency.