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Sample accounting flow in a procurement shared service center

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edited Mar 23, 2022 3:47AM in Payables, Payments & Cash Management 1 comment

Summary: I would like to understand the accounting entries generated in a simple centralized procurement scenario

Content (required):

There are 2 BU's. BU1 is the procurement BU and BU2 is the requisition BU.

Both BU's are in the same ledger, share the same CoA, currency, calendar etc

BU 1 will perform procurement, invoice processing and payment processing on behalf of BU2

Item to request and purchase: Office stationary 100 units at 23$

Invoice from supplier : office stationary 100 units at 25$ resulting in IPV of 2$ per unit

I would greatly appreciate if you could share the accounting entries generated including the intercompany accounting entries in both the requisitioning BU and procurement BU

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