ANS-1632 · ACCOUNTING & FINANCIAL CONFIGURATION
How to Ensure Intercompany Journal Entries Eliminate Correctly in NetSuite
Properly configuring intercompany journal entries and related accounts is crucial for accurate elimination and preventing outstanding balances in aging reports during divestitures or other intercompany settlements.
Short answer
To ensure intercompany journal entries eliminate correctly in NetSuite, configure journal lines with the intercompany customer/vendor, mark intercompany AP/AR accounts for elimination, and check the "eliminate" box on the entry. Match these entries to open intercompany transactions via customer/vendor payments to clear aging reports.
Scenario
When processing intercompany journal entries, particularly during divestitures or other intercompany settlements, users may encounter issues where these transactions do not eliminate as expected. This often results in outstanding intercompany balances persisting in aging reports, indicating a configuration mismatch.
Solution
The proper elimination of intercompany journal entries in NetSuite requires specific configurations on the journal entry lines, the associated accounts, and the journal entry itself. Failure to meet these conditions typically results in elimination errors.To ensure intercompany transactions are eliminated correctly:
For intercompany AP and intercompany AR lines, specify a customer or vendor representing the other subsidiary (an interco customer or vendor) in the "name" column.
Verify that the intercompany AP and AR accounts must have the "eliminate intercompany transactions" box checked on their respective account records.
Ensure the "eliminate" box is checked on the journal entry itself.Additionally, when using a journal entry to close off intercompany AP and intercompany AR, it is essential to match these journal entries to open intercompany customer invoices/credits and intercompany vendor bills/credits. This process prevents these transactions from remaining in aging reports.To match these entries:On the AR side, navigate to "accept customer payment".On the AP side, navigate to "pay a single vendor".For further information, refer to SuiteAnswers article ID 88268: https://suiteanswers.custhelp.com/app/answers/detail/a_id/88268/loc/en_US
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