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How to adjust intercompany transaction in qb

Hi I am doing intercompany reconciliation in QB. For 1 entity I have AR transaction for certain amount and for another entity I have the same amount under AP transaction.

 

Ex.

                     

                  Company

Entity 1                   Entity 2

 

AR $100                        AP $100

 

The auditors want me to make adjustment to the intercompany transactions so we can create a consolidated balance sheet reflecting the correct amount.  Do I reverse these AR and AP entries since they are intercompany or deleting them entirely on both sides? I have done this in SAP, what exactly does this mean in QB?

 

 

2 Comments
Anonymous
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Re: How to adjust intercompany transaction in qb

We need to be very clear on the setup>

1.Each 'entity' is a related company with separate QB data files

- or 2. each entity is part of a single co and both are within the same data file?

or 3 - something else.

 

If 1 then no changes to QB balance sheet for either co - consolidation is done outside of QB

If 2 then change one entity so that IC postings are within AP only - they will then appear to offset - but don't actually do any offset posting

Established Community Backer ***

Re: How to adjust intercompany transaction in qb

Nothing here is AP. You are describing a Different type of Liability, so that is Other Liability or Other Current Liability. And for the AR, that is not Customer Sales; that is a different type of Asset, so Other Current Asset or Other Asset.

 

There is no use for AP and AR because you are not each other's Customer or Vendor.

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