To create intercompany transactions in General Ledger, or in other Lawson applications, you must define intercompany relationships. An intercompany relationship identifies the payable and receivable accounts used to post company balancing transactions. You can define these accounts by system. You must define relationships for each company that originates intercompany transactions.
NoteThe source code for system-generated intercompany balancing entries is CB.
General Ledger uses intercompany relationships to create balancing entries when you release an intercompany journal entry, or when a subsystem intercompany transaction is transferred to General Ledger. Balancing entries are made to the intercompany payable and receivable accounts.
The intercompany payable account is used to balance the entries in a company if the original entry for the company is a debit entry.
The intercompany receivable account is used to balance the entries in a company if the original entry for the company is a credit entry.
Some companies use the same account for intercompany payables and intercompany receivables.
An intercompany journal entry is an entry from one company with at least one transaction line to a different company. The system creates intercompany payable and receivable detail lines to keep each company in balance. You are limited to 9,999 intercompany journal entries per fiscal period per company.
TipSystem generated journal entries in receiving companies are numbered as follows: the first four digits of the journal entry number are the From company's company number and the second four digits are the journal entry number of the intercompany journal entry.
The process for creating, releasing, and posting an intercompany journal entry is very similar to the processes used for a normal journal entry. The following differences exist between an intercompany and normal journal entry:
You select a journal entry type of "I" for an intercompany journal entry.
You enter an originating company in the header of the journal entry. Enter a different company number in the Company field on the transaction line of the journal entry to indicate that the transaction line should be posted to a different company. Transaction lines with a different company number in the Company field are considered memo transactions in the originating company.
When you release an intercompany journal entry, General Ledger creates the intercompany balancing transactions for the originating company and creates a balanced journal entry for the receiving company. Transaction lines with a company number in the Company field are considered memo transactions in the originating company.
You cannot change the memo line or the balancing line of the entry on the From side of an intercompany entry.
You can unrelease the entry on the From Company side, but not on the To Company side.
You cannot maintain the To side of an intercompany entry. You can copy the original entry and reverse it.
If you unrelease a From Company entry and add a new line affecting the To Company, a new entry will be created in the To Company using the original journal entry number with a sequence number.
Transactions created by intercompany processing have a source code of CB (Auto Company Balance).
The following example shows the detail lines for an intercompany journal entry. In the example, company 4321 is transferring inventory to company 1234.
When you release an intercompany journal entry, the General Ledger application creates balancing entries to the intercompany payable and intercompany receivable accounts defined for each company on Intercompany Relationships (GL25.1).