Eliminating Intercompany Revenue and Cost

Objectives

After completing this lesson, you will be able to:

  • Eliminate intercompany revenue and cost

Eliminate Intercompany Revenue and Cost

When the 2011 IC Elim Sales task is run from the Consolidation Monitor, the log displays the elimination postings. In the following image, the log for BE00 is displayed.

  1. The Triggering Amount of -12.000 is the revenue for the seller (BE00).
  2. The Journal Entry Amount of 12.000 is the elimination of revenue for the seller (BE00).
  3. The Journal Entry Amount of -12.000 is the offset for the seller.
The triggering amount for sequence 010 is -12000 for fs item 411000. The journal entry amount in sequence 010 is 12000 for fs item 411100. The journal entry amount in sequence 010 is -12000 for fs item 41200d.

In the following image, the log for FR00 is displayed. A credit of -12.000 is posted to the cost FS item 412200 for FR00.

The journal entry amount in sequence 020 is -12000 for fs item 412200.

The results can also be confirmed in a group report. The 12.000 of intercompany revenue for BE00 is eliminated and 12.000 of cost for FR00 is eliminated in posting level 20. Offsetting values are posted to the 41200D FS item to keep the consolidation units in balance.

The report shows a debit of 12000 for fs item 411100 and a credit of -12000 for fs item 412200

Eliminate Intercompany Revenue and Cost

Business Scenario

At ABC Corporation, you have configured a reclassification method for the intercompany revenue and cost elimination. When you run the task, you need to make sure that rule 010 eliminates revenue for the seller and rule 020 eliminates cost for the buyer.

What skills will you develop in this practice exercise?

  • Run the intercompany revenue and cost elimination
  • Evaluate the results in the log

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