What is the difference between intra company and intercompany

Intercompany journals involve balancing segment values that map to different legal entities. These journals are balanced for each legal entity by using their intercompany accounts. The Balancing API uses the intercompany accounts defined for the relevant effective date range. Since multiple accounts may be defined for the same date range, the Balancing API picks the accounts flagged with the Use for Balancing indicator.

The offsetting debit for a legal entity goes into its intercompany receivables account. The offsetting credit goes into the legal entity's intercompany payables account. Intercompany accounts may be defined at the legal entity level. That is, each transacting legal entity has different intercompany accounts defined for different trading partner legal entities, regardless of which specific balancing segment values of those legal entities are used in the journals.

The transacting and trading partner balancing segment values are then not explicitly specified in the definition and are set to All. Intercompany accounts may be defined at the balancing segment level of the legal entities. In other words, a transacting legal entity can use different accounts for different transacting balancing segment values, depending on what the trading partner legal entity and trading partner balancing segment value are.

In that case, transacting or trading partner balancing segment values may be explicitly specified in the intercompany account definitions. There are different types of intercompany journals. The Balancing API first determines the type of the intercompany journal one-to-one, one-to-many, many-to-one, or many-to-many with respect to the legal entities.

For intercompany balancing there is no clearing company usage and all legal entities are balanced by summary net with respect to each other. Balancing segment value 10 maps to legal entity 1 LE 1. Balancing segment value 20 maps to legal entity 2. The chart of accounts for this example has three segments: balancing, natural account, and Intercompany.

The API determines that 10 and 20 belong to different legal entities. Because this journal has one debit legal entity 10 and one credit legal entity 20 , it is a journal. The API begins with the debit legal entity. The balanced journal is:. Intercompany accounts are defined to provide automated accounting between legal entities within the same company.

Important: Defining intercompany Receivables and Payables accounts is required before using the intercompany feature. Before defining intercompany accounts, you need to choose a transacting legal entity From legal entity and a trading partner legal entity To legal entity. Intracompany balancing rules are used to create balancing lines on journals between balancing segment values either within the same legal entity, or where there is no legal entity context. See this post or this post for details on setting up the accounts Like Like.

Hi David, Thanks for your support, As you mentioned above in step 3. Thanks in Advance, Dinesh. Advacned Thanks, Lalitha. So in light of these words, do you have any additional information?

Bill Thanks for your reply. Yes, David is correct. I was talking about the IC balancing entries. Thanks, Lalitha Like Like. What reason do they give for wanting the balancing lines generated at GL post time? Thanks David for your kind reply. Thanks, Lalitha. Lalitha, One possibility is you could look at changing the seeded rules SLA to include some of the processing logic that the legacy systems provides for these lines. Please let me know if you have any idea on how to achieve this.

Thanks, Lokesh. David, I find it baffling that Intracompany needs to be enabled in order for Intercompany to work. Nick What enabling are you referring to?

Thanks for your valuable time. Looking forward for your reply. Regards Ganesvnath Like Like. David, I have a very in-depth intercompany balancing question for you: When creating a transaction that deals with one balancing segment from a legal entity LE A to two balancing segments from a different legal entity LE B , I am receiving excessive and unwanted balancing entries.

Do you have any idea why this is happening and how to prevent it? I hope I could explain clearly and looking forward to your help. Thanks in advance. Elahe Like Like. AGIS for multiple legal entities.

Appreciate your quick response. Thanks Shagun Like Like. Regards Shagun Goyal Like Like. Great post! I have few question where in i still have some doubts 1. Thanks in Advance Like Like. Hi there, thanks for posting, answers to your 5 questions below 1 Yes. Only new transactions would be effected 2 AP and AR can calculate tax for you if you want. Answer 5 should be. No impact Like Like. You should raise an SR with Oracle support for this. Thanks a lot ,Wyatt Like Like. Thanks Sury Like Like. Nice content.

Nice article. Thnkx Like Like. Leave a Reply Cancel reply Enter your comment here Fill in your details below or click an icon to log in:.

Email required Address never made public. Name required. Follow Following. Enterprise Applications by David Haimes Join 2, other followers. Sign me up. Already have a WordPress. Log in now. Get Word of the Day daily email!

Test Your Vocabulary. Can you spell these 10 commonly misspelled words? Love words? Need even more definitions? Homophones, Homographs, and Homonyms The same, but different. Ask the Editors 'Everyday' vs.

An Intra company transaction is one between branches or divisions or departments of the same company. It's internal. This definition from the Merriam-Webster dictionary occurring within or taking place between branches or employees of a company intracompany transactions.

Inter Company transactions are carried out between two different companies but both companies are related to each other in the sense that they are within a group.

For example, the transaction could be between a parent and subsidiary company. On the other hand, Intra Company transactions are internal and takes place in a company itself.