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AdvisorWebcast.pngYou may have attended on May 17th, 2017, the Advisor Webcast on JD Edwards EnterpriseOne Financials Intercompany Settlements. Or maybe you saw the MOSC thread on the webcast,

https://community.oracle.com/docs/DOC-1013138. Whether you have or haven’t, I thought that it is an important enough topic to discuss on the Intercompany Settlement methods here in the blog as well.

Method Details:

  • There are three methods of setting up intercompany settlements:
  • The Hub Method (1)
  • The Detail Method (2)
  • The Configured Hub Method (3) - Introduced in 8.9
  • The Intercompany Settlements process is system wide. In other words, you cannot choose to allow intercompany settlements between specific companies and not others.
  • If you are using intercompany settlements, you must set up ALL companies for this functionality even if you have companies which will never use the process.
  • You create intercompany settlements to ensure that each company's net balance equals zero (that is, debits equal credits). You can either create these settlements yourself or have the system create them automatically.
  • When you post (R09801) transactions using one of these methods, the system creates journal entries for intercompany settlements based on Automatic Accounting Instructions (AAIs). Two AAI items exist for intercompany settlements. Depending on the method that you choose, you must set up one or both of the AAIs.
  • If your organization uses multiple currencies, you must use either the detail (2) or configured hub (3) method for intercompany settlements.
  • Hub methods are more commonly used than Detail Methods. Hub methods require more account setup than detail methods, but create fewer records in the Account Ledger table (F0911) when you post entries.
  • Detail methods are commonly used by multi-national companies and government agencies that need a detailed audit trail.
  • When you choose the Hub Method, the system creates summarized journal entries by batch and GL date between a hub (main) company and related subsidiary companies. You can have only one hub company. The system reconciles transactions between subsidiary companies through the hub company.
  • When you choose the Detail method, the system creates detailed journal entries by document between companies, using the company on the first line of a journal entry as the hub company. Because no designated hub company exists, the system reconciles transactions between the companies involved.
  • Configured hubs are groups of companies that you can define, or configure, to accommodate intercompany settlements.

 

For more detailed information, you can play the recording of the webcast or review a PDF of the presentation. To find these:

  1. Go to knowledge article Advisor Webcast JD Edwards EnterpriseOne Schedule and Archived Recordings (Doc ID 1450327.1)
  2. Click on the tab named ‘Archived 2017’
  3. Scroll down to May 17.
  4. Then either click on the webcast title ‘JD Edwards EnterpriseOne Financials Intercompany Settlements.’, or on the recording or PDF links for this webcast.

 

You can also review these knowledge articles for more information on the Intercompany Settlements:

  • E1: 09: Overview of Intercompany Settlement Methods (P0000) (Doc ID 1416193.1)
  • E1: 09: Frequently Asked Questions on the Intercompany Settlement Methods (P0000) (Doc ID 664765.1)
  • E1: 09: Overview of Automatic Accounting Instructions (AAI) in General Accounting (P0012) (Doc ID 664682.1)

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