Intercompany transactions in SAP AP / AR : Cross Company Code Transaction

Several companies are involved in an intercompany transaction. The system will post a separate document with its own document number in each of the company codes. A common cross-company code number links individual documents together. The system generates line items automatically (receivables and payables arising between company codes) in order to balance the debits and credits in each document.

Company One

Dr.            Expense / Balance Sheet account for Company One

    CR.       Intercompany AP

Company Two

DR.             Intercompany AR

    CR.       Expenses / Balance Sheet account for Company Two

Each branch will have different general accounts for AP and AR to separately identify there debits and credits.

This transaction will only be finance related. Intercompany posting in Logistics will be posted in the system automatically.

The process for posting intercompany transactions is as follows:

1. The initial entry is parked.

2. Then an email is sent to the other branch to view the document.

3. On approval of the transaction, the parked document is then posted to the g/l in both companies. The company receiving the revenue will be the one responsible to book into system using the US dollar as base currency.

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