Creating an Intercompany Account

An intercompany account is a key component in managing transactions between different entities within the same organization. These accounts are used to track and reconcile financial transactions between a parent company and its subsidiaries, or among subsidiaries themselves. Establishing these accounts correctly is crucial for maintaining accurate financial reporting and ensuring compliance with accounting standards.

What is an Intercompany Account?

An intercompany account is a general ledger account used to record financial transactions between different entities within the same corporate group. This includes sales, loans, transfers, and expenses that are exchanged between the parent company and its subsidiaries, or between subsidiaries themselves.

These accounts ensure that intercompany transactions are properly accounted for and eliminated during the consolidation process, preventing double-counting and providing a true picture of the group’s financial health.

Create an Intercompany Account

To create an intercompany account:

1. Click the company icon in the top right corner of the screen.

2. Go to Organization Settings > Chart of Accounts.

   
3. Select + Add Account to open the account creation form.

   
4. Complete the Account Information. For detailed instructions on filling out the account information, refer to the article 📄 Chart of Accounts

   Fields include:

   • Number

   • Name

   • Type

   • Subtype

   • Parent Grouping (optional)

     
5. Designate the account as Intercompany:

   • Toggle the switch to designate this account as an intercompany account. This is important for tracking transactions between different entities within the organization.

6. Click Save to create the intercompany account.

   

Viewing Intercompany Accounts

Intercompany accounts will be designated with the Intercompany Icon on the Chart of Accounts: