Discussion:Best Way to Track Intercompany Payable in QB
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| 18 June 2008 | |
| If all of the expenses of my US sub are getting paid by the foreign parent, I want to establish an Intercompany payable account in QB to track the payments that were made and the amounts owed to the parent. However, I also want to track the open invoices in QB, i.e the ones not yet paid by the parent. What is the best way to do this? I initially entered bills (using an I/C AP account) and listed the actual vendor name on the invoice and the amount. This look great on the BS as it shows the proper amount due to the parent.
However, since I have the actual vendor name on the invoice, when they cut a check to the parent for repayment, the vendor name on the check will not be the parent but will be the US vendor. What is the best way to track the intercompany loans and preserve the vendor history at the same time? Is it better to enter all of these payments made by the parent company as journal entries and skip the A/P module? | |
| June 19, 2008 | |
| ? QBs = US sub's books
bills in QBs = actual sub's bills to be paid by parent I guess what you could do is set each vendor up to print the parent's name on the check (edit vendor, "Print on Check as"), but then you would have multiple checks issued where normally you would have one. If you wanted to do it via JEs, I recommend you make the inter-company account an "other current liability" so that you don't run into issues with being allowed to only enter one A/P line per JE. You can still use the vendor name in the JE, but you may need to work a little with the reports for the history part of it. | |
RoyDaleOne (talk|edits) said: | 19 June 2008 |
| I think it would be simpler to open a US Sub bank account and have the parent transfer the money to pay the bills. | |
| 19 June 2008 | |
| Thank you for your input. Will speak with the client regarding the funds transfer which actually will work great on a go forward basis -- it's the historical part that is tricky.
What we ended up doing is entering all of the subs bill thru the AP module as normal bills. Then when the parent paid the bills, I used the "Pay Bills" module and create a bank account named "Clearing Account" All of the bills are paid from that clearing account and then, I did a Funds Transfer to move the money from the clearing account to the I/C Payable account. Works pretty well because any unpaid bills are sitting in Trade A/P and the Loan with the Parent is in Other Current Liabilities. Thank you for your input. | |
| June 19, 2008 | |
| I hadn't thought about using a clearing account. It sounds like that would accomplish what you want. | |
| 9 July 2008 | |
| Why not set up the intercompany payable as a credit card in QB. This would allow you to enter the vendor information in the credit card bill and you wouldn't have to make the funds transfer entries. | |
| 10 July 2008 | |
| In retrospect, perhaps this would've been the way to go -- by entering the vendors in the JE's we can still run transaction reports by vendor but it's a little more cumbersome. | |
| July 15, 2008 | |
| The thing about using an A/P account in the JEs is you are limited to only one line item per JE. You could, however, have an account called "A/P" that is an "other current liability."
I actually really like the credit card idea best. It's easy to work with, and I think you can get the reports you are interested in. | |
