Currencies and group companies
Record and reconcile inter-company transactions
Keep a register of sales, loans, fees and other dealings between companies in your group, match each one to the other company's entry, and mark it reconciled before consolidation.
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In this article
When several companies in one group trade with each other, the same deal appears in two sets of books: a sale in one company and a purchase in the other, or a loan given and a loan received. The inter-company register links the two sides, so that both companies agree on the figures and the group can remove them when it consolidates.
Before you start
Each company posts its own entry first, in its own books, with the usual screens such as a sales invoice or a journal entry. The register does not post anything.
Note the ID of your journal line. You find it in the ID column of Accounting › Transactions › Transactions.
Your user group needs the inter-company permission.
The screen has no entry in the standard menu. Open it by adding
/s/accounting.intercompany.transactions.indexto your workspace address, or ask your administrator for the link.
Record a transaction
Open Inter-company Transactions and select New Transaction.
Choose the Destination Company, the other company in the deal. You cannot choose your own company.
Set the Date and choose the Type: sale, purchase, loan, management fee, royalty, dividend, asset transfer or other.
Enter the Amount.
In Source Transaction ID, enter the ID of the journal line in your books.
Optional: choose the Currency and enter the Exchange Rate when the deal is in a foreign currency, and enter the Reference No. of the invoice or contract.
Enter the Description, and the Description (Arabic) if you use it.
Select Save.
The new transaction starts as Pending. Your company is recorded as the source, with the branch you are working in.
Match it to the other company's entry
Once the other company has posted its side, link the two.
Open the transaction's actions menu, or open the transaction and use its buttons, then select Match.
Enter the Destination Transaction ID: the ID of the matching journal line in the other company's books.
Select Match. The status changes to Matched.
Only a pending transaction can be matched.
Reconcile it
When both companies have checked that the amounts agree, select Reconcile and confirm. The status changes to Reconciled, and the transaction is ready for consolidation. Only a matched transaction can be reconciled.
The life of a transaction
Status | What it means | Next step |
|---|---|---|
Pending | Recorded by the source company only. | Match |
Matched | Linked to the other company's journal line. | Reconcile |
Reconciled | Both sides agree. | Include it in an elimination |
Eliminated | Covered by a posted elimination for its month. | None |
When you post an elimination, every reconciled transaction of your company dated in the same month is marked Eliminated.
Find and export transactions
Filter the list by Status, Type, Source Company, Destination Company, Currency, Reconciled or Eliminated, or search it. Select a row to open the transaction with its companies, branches, amount, reference and descriptions. Use Export to download the list as Excel or PDF.
Common questions
Does recording a transaction change my balances? No. The register only tracks the link between the two companies' entries. The balances come from the entries each company posted.
The other company has not posted yet. Can I still record the transaction? Yes. Record it as soon as your side is posted. It stays pending until the other company posts and someone matches it.