An attribute that includes the intercompany trade details for an intercompany trade scenario. An intercompany trade agreement is linked to an intercompany trade relationship, together with the intercompany trade scenario.
For the applicable intercompany trade scenario and trade relationship, an intercompany trade agreement:
- Determines whether internal invoicing is used.
- Determines whether intercompany trade orders must be approved before they can be processed.
- Includes the transfer pricing rules that determine the amounts of the intercompany trade transactions.
- Determines the amounts of the internal invoices, if internal invoicing is specified.
Example
Sales office S1 and warehouse W1 are part of organization A, but are located in different countries. To fulfill a sales order to an external customer, S1 instructs W1 to deliver the goods to the customer. W1 sends an internal invoice to S1 to cover the costs for the goods and the delivery. The amount of the internal invoice is based on the sales order price.