companies.gif Intercompany Accounts

In the Chart of Accounts Info Center, you create intercompany accounts that are available to all companies in your enterprise. Vision uses these accounts for processing labor and expense charges for intercompany transactions.

Intercompany accounts can be the same across the enterprise, but they are not required to be the same.

After you set up the account records for the intercompany accounts in the Chart of Account Info Center, you identify them as intercompany accounts by selecting them under Intercompany Accounts on the Accounts tab of Accounting Company Settings.

Foreign Employee Types

Employee types tell Vision which accounts to use when charging labor to projects, phases, and tasks:

It is likely that you will not select the same employee types for all companies in your enterprise. To allow for the possibility that Company A may reference an employee type that Company B does not use, you must specify the direct and indirect accounts that Vision should use to process timesheets or labor adjustments that reference foreign employee types. Vision uses the intercompany account number specified in the Foreign Employee Type Labor Posting Accounts-Direct Account field on the Accounts tab of Accounting Company Settings.

See Example: Foreign Employee Types for an illustration.

Guidelines

 

Intercompany Account

Account Type

How Vision Uses the Account

Accounts Receivable

 

Asset

Vision debits this account when processing invoices for intercompany billing.

Accounts Payable

Liability

Vision debits this account when you post vouchers for an intercompany transaction.

 

Suspense

Asset or liability

When a transaction involves another company, some time will pass between the transaction posting date and the date that you run the Intercompany Billing process.

To support the need to balance accounts during this time, you must create an intercompany suspense account. This account keeps your books in balance until the process of running intercompany billing creates the appropriate accounts receivable and accounts payable entries, clears this suspense account, and redistributes the credit amount to the correct company.

In this way, you avoid creating tolerances on the companies' balance sheets.

 

Labor Revenue

Revenue

You set up this account only if the Enable detailed subledgers for intercompany billing option is selected on the General tab of Accounting System Settings (Configuration » Accounting » System Settings).

Vision uses this account for labor revenue when generating intercompany invoice transaction files for this company.

You must map this account to the company's intercompany AR Account Column on the Invoice Mapping Accounts tab in Accounts Receivable Configuration (Configuration » Accounting » Accounts Receivable).

 

Expense Revenue

Expense

You set up this account only if the Enable detailed subledgers for intercompany billing option is selected on the General tab of Accounting System Settings (Configuration » Accounting » System Settings).

Vision uses this account for expense revenue when generating intercompany invoice transaction files for this company.

You must map this account to the company's intercompany AR Account Column on the Invoice Mapping Accounts tab in Accounts Receivable Configuration (Configuration » Accounting » Accounts Receivable).

 

Intercompany Cash Basis Suspense

 

Revenue or expense

You set up this account only if both of the following are true:

  • The Enable detailed subledgers for intercompany billing option is selected on the General tab of Accounting System Settings (Configuration » Accounting » System Settings).

  • The Allow for Reporting: Cash-basis reporting option is selected on the General tab of Accounting System Settings.

Vision uses the intercompany cash-basis suspense account when creating cash-basis entries for intercompany transactions. We recommend that you use an indirect expense account, because, unlike the suspense account, this account is likely to retain a balance. Depending on your intercompany billing configuration, that balance will represent any markups on intercompany expense transactions or the cash-basis expenses and revenue associated with intercompany entries.

Vision uses this account for cash-basis entries when processing the following intercompany transactions:

  • Accounts payable payments, employee expense payments, accounts payable disbursements, and cash disbursements.

  • Cash receipts for intercompany billing transactions

  • Payment of intercompany vouchers

To ensure that this account is used correctly for intercompany cash receipts, you must specify this account as the cash-basis account for your intercompany accounts receivable account. To do this, open the intercompany accounts receivable account in the Chart of Accounts Info Center and select the intercompany cash-basis suspense account from the Account Lookup in the Cash Basis Account field. If you do not complete this step, your intercompany accounts receivable account will have a balance that will not be cleared, and you will have to do a journal entry to clear it manually.

Foreign Employee Type Labor Posting Accounts

Direct

 

Direct Expense Account

Vision credits direct labor charges to this account when you post timesheets or labor adjustments that reference a foreign employee type.

 

Indirect

Indirect Expense Account

Vision credits indirect labor charges to this account when you post timesheets or labor adjustments that reference a foreign employee type.