Intra-corporate accounts are the accounts included in the general auditing of organizations representing balances of payments originating from or originating from joint ownership or control entities. For example, if Company A creates thresholds and sells $ 100 to a sister company, Company B, it exists in the general account or exists in corporate relationships where "B" is "A", and vice versa, Company A has a Company B Claim.
At the end of each month, Consolidated Corporate Accounts and Payable Company Accounts must have the same Balance, Intercompany A / R and Credit for Intercompany A / P.
Many companies have conflicting questions about corporate reports. Many people may have this issue open for days or weeks for longer than needed. I know about a company where it was not uncommon to settle customer accounts for millions of dollars a month. Unless a company has established proper controls to control the balances, the problem will continue to grow and become increasingly unmanageable as it grows.
. The reason for these imbalance situations is usually very small – If Company A of the previous section sells a widget for $ 100 for "B" and supplies $ 10, but Purchasing Department "B" tells the payable department to it is not on the purchase order if it pays it, then the company will show a balance if the question has not been resolved by the end of the month. Many companies assume their subsidiaries' fees for corporate clients based on their working capital, which encourages the working capital to be as low as possible to avoid excessive corporate fees. If we do not agree with the calculation, this can cause inequality in the Intercom accounts. The lack of clarity of the unit conducting the fee or the lack of acceptance by the entity entitled to receive the fee may potentially cause imbalances. Experience
is based on huge issues related to entity entities with only a few entities and balancing accounts, for large corporations with thousands of entities that have very few problems in obtaining a balance between accounts
. intercompany situations:
Of course, we could include four categories:
In the research of this question, many technological solutions have been found on the market, no harm to programmers is generally much more difficult than the processes they have changed. These solutions do not result in balance of accounts and allow you to carry out the process from a higher level. Without clearing up the process, communicating and further business support, it only results in minimal if it has results, and even more frustration, as investments are placed in systems that do not have the expected return on investment
By definition, you are responsible for ensuring that inter-company accounts (or any accounts, on a case) are firmly rooted in your organization's control. Some organizations do not have a person called Controller, but it is usually obvious who the person who performs the audit functions. In almost every organization, the auditor must have the organization's balance and guardian of financial policies and procedures. In addition, since the Controller must be on the balance sheet and support the reconciliation process, the executive management, ie the CFO, the CEO, the vice-presidents, and so on. It must support the inspectors' ability to enforce intercompany timely reconciliation.
Entrepreneurship organizations have a matrix or semi-matrix reporting structure. The ugly habit of this situation is to break up the duties. It should be clear that the parent company's trustee is the ultimate arbitrator with Intercompany accounting disputes, and unless it is unlawful.
Just as the company owner owns the organization's balance sheet, department heads have the same responsibility within their department and should be responsible to the auditor at the next level of the organization. This chain of responsibilities goes on to plant inspectors (or equivalent) who must also be responsible for the responsible inspector (s) in the responsible food supply chain.
The reconciliation process relies on education. However, education must be preceded by top-down policies. These must include, but are not limited to:
After policies are functioning (and controlled), the right staff will need training, up to the top of the Accounting hierarchy. Especially when it was originally implemented, policies and procedures often need to be revised in order to address common corporate-specific issues arising in the first few months of implementation. However, great care must be taken to ensure that policies are not changed simply to ensure compliance. Each time a policy is revised for a problem, we need to ask whether the problem lies in the policy, procedures, or process. After generating effective directives and introducing them through the organization, the issues that arise are usually about process or process issues. Keep in mind that policies are protecting the organization and protecting the basics of processes and procedures that are in line with policies.
What if you are already on the road and find a great reconciliation mess? The same laws of social reconciliation continue to apply. Bleeding should be abolished in order to create policies, education, procedures and processes, and existing clutter should be cleaned. This should be first attempted with the existing staff, with the explicit statement that if bills do not balance the corporate policy by a certain date, a " firefighter " will gather to assist the organizations involved in the reconciliation process. This usually encourages bribes to get the most companies, because no one wants the Enterprise to appear and help get started – this is probably only for the IRS that can help.
It has been found that many technology solutions are much more difficult than the current process of the company. We can not say that technology can not help, technology can help or increase it by having effective policies, but policies must be in place, effective, and enforced or the technology solution is only one.
Often that in this gentle world, the Brotherhood does not actually have any manual hours to deal with these reconciliation issues between operating entities. In this situation, a third party can help in the process of reconciliation or in troubleshooting policies, procedures and processes to ensure a reliable process of inter-company reconciliation.
Source by sbobet