InterCompany Payments

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Posted on by Community Member

Hi All,

when we use intercompany functionality, Intercompany receivables and intercompany Payables a/c are automatically effected

These accounts are set as do not allow for manual entry to place a control

Now if I need to pay using check the Intercompany Payable amount how doI go about it ?

Thanks

PS: I don't want to disable Do not allow for manual entry option

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Community Member on at

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Just to add these Intercompany are non trade balances

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Ludwig Reinhard Microsoft Employee on at

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Hi Dhruv Singhvi,

Where do you see a problem here?

The intercompany receivable and payable ledger accounts are linked to your intercompany customer and vendor records through the AP/AR posting profile form.

Having said that, AX will debit/credit those accounts when you create payments as long as the intercompany customer/vendor account is referred to in the payment journal.

Would be great if you could let us know whether and where you see some potential Problems in regards to Manual entries on those accounts.

Many thanks and best regards,

Ludwig

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Community Member on at

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Thank you for your immediate response.

Here in this case I am discussing about the intercompany accounting and not intercompany vendor/customer. When we pass journal entries using intercompany accounting functionality, then interunit payable and interunit receivable is create

For Eg: Legal Entity 2 paying expenses on behalf of Legal Entity 1. Following set of entries are passed in each legal entity:

Legal Entity 1:

Expenses A/c Dr

To Inter-unit Payable A/c

Legal Entity 2:

Inter Unit Receivable Dr

To Bank A/c

Now If Legal Entity 1 wants to pay Legal Entity 2 using check ( to finish Inter Unit payable A/c) how can we do it ?

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Ludwig Reinhard Microsoft Employee on at

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Hi,

Why is it that you post the expenses against the inter-unit payable account?

If you receive an expense invoice from an external vendor, just post it as usual.

DR: Expense

CR: Accounts payable

When you then create the payment Journal, just select the other Company, vendor and invoice to settle.

Here is an example where USMF pays an invoice that has been recorded in USRT

At the time USMF makes the payment, AX Posts an intercompany receivable

In USRT, an offsetting intercompany payable is posted and (!!!) the original payable is automatically cleared.

So what is posted here in USMF is

DR: IC receivable

CR: Bank

And in USRT:

DR: Accounts payable

CR: Intercompany payable

When and whether you Offset and pay the intercompany positions depends then on the intercompany Agreements made.

Does this make sense to you?

Best regards,

Ludwig

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