Intercompany Transactions
An intercompany transaction is a posting within an entity on an intercompany account. An entity is identified as intercompany based on its business relation.
Example: An organization supplies goods to an affiliated company. When creating the invoice, the user assigns an intercompany code to indicate that the sale was to an associated entity. In this instance, the system generates only one GL transaction for the invoice.
When you generate a sales invoice and post to a customer account that uses an intercompany code, the resulting transaction identifies that the invoice was sent to the entity specified by the intercompany code.
Customer Invoice Using Intercompany Code
Intercompany Reporting
The GL Transactions report includes Intercompany as a selection criterion, which you can use to identify intercompany transactions to be eliminated before consolidation. You can net intercompany transactions using open item adjustment. See
Open Item Adjustment.
