Inter Company Transactions

Any company with subsidiaries or multiple related entities is familiar with intercompany accounting. It’s the process in which intercompany transactions are reconciled to avoid counting transactions twice, first on the parent company’s books and again on the books of the subsidiary. If you’re entangled in the process, you know that it comes with its boons & banes.

Intercompany accounting can be a particular burden for small and medium-size businesses (SMBs) that are expanding their organization structure in order to enter new markets or accommodate increased supply chain complexity. At the same time, SMBs do not have the internal resources to perform the necessary manual accounting adjustments. Additionally, many simple accounting systems affordable for SMBs lack the functionality to properly handle multiple entity or branch accounting.

But all these issues are addressed with WinGold Next. WinGold Next “Branches” functionality in combination with “Intercompany Accounting module” to best represent multiple related companies so a company with several businesses under its umbrella doesn’t have to reconcile the intercompany transactions.

Ideally, the accounting across all business operations should be performed by and captured in a single system. In such a system, transactions between businesses units are “posted” in both simultaneously, so that inventory, cash, payable, and receivable balances accurately reflect current levels, and transactions are not duplicated.

Intercompany Transactions with WinGold Next works in 3 simple steps:

  • Receipt
    1. Daily cash deposit into Head Office Cash/Bank account from multiple location
    2. Deposit of credit card of multiple location into Head Office Bank Account
    3. Deposit of Cheque receipt at multiple location into Head Office Bank Account
  • Payment
    1. Payment to Location Expense Account from Head Office Bank/Cash Account
    2. Payment to Location Cash Account from Head Office Bank/Cash Account
  • Currency & Quantity Journal Voucher
    1. Journal Voucher in Currency/Quantity with Multiple Locations