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.
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?
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.