Intercompany scenarios
Many scenarios exist regarding why your organization can use intercompany trade to streamline your business processes. Scenarios that your organization can use the intercompany trade functionality for include:
A parent company manufactures products that it sells to its subsidiaries. Intercompany trade allows for seamless procurement processes between entities in the same corporate group, ensuring accurate recording of purchases and sales.
Subsidiaries might transfer inventory items to each other based on demand or production requirements. Intercompany trade facilitates these transfers, allowing for accurate recording of inventory movements and valuation across entities.
Organizations might need to reallocate costs that they incur centrally, such as overhead expenses or research and development costs, among different subsidiaries. Intercompany trade ensures an appropriate distribution of these costs based on usage or other allocation criteria.
Organizations can transfer assets, such as machinery or equipment, between subsidiaries for operational reasons. Intercompany trade helps organizations properly record these asset transfers, including asset valuations and depreciation calculations.