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Hyperion 11.1.1.3
INTERCOMPANY
PARTNER

Provided By: BISP Created By: Rupam Majumdar

http://bispsolutions.wordpress.com SME - Hyperion
bisp.consulting@gmail.com Reviewed By: Amit Sharma
http://learnhyperion.wordpress.com BISP Team

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INTRODUCTION

A transaction between two entities in an organization is an intercompany

transaction.

Intercompany Account Balances

Intercompany data is captured in intercompany accounts.
Intercompany balances are not relevant for external financial reporting.

According to accounting rules, intercompany account balances are eliminated

prior to external financial statement generation.

Intercompany transactions produce intercompany account balances.

To avoid overstatement, intercompany account balances must be eliminated
before external financial statements are generated. Balances are eliminated at
the first common parent of the intercompany partners.
During data consolidation, Financial Management automatically eliminates
intercompany balances.

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Elimination Process
Elimination of intercompany balances occurs during data consolidation.
During the elimination process, differences between intercompany account
balances are posted to a plug account.
For the example on the slide, EastSales leased equipment worth USD $1,500
from Plant1. When data is consolidated, the intercompany account balances
for the RentalExpense and RentalRevenue intercompany accounts are
eliminated at the first common parent, the USA entity.

Plug Accounts
Because balances for intercompany partners may not agree, you need
accounts that, upon consolidation, record the differences between pairs of
intercompany account balances. In Financial Management, these storage
accounts are referred to as plug accounts.
The example on the slide shows a USD $500 Sales intercompany balance
against a USD $600 Purchases intercompany account balance. When
consolidation is performed, the USD $100 difference is placed in the
intercompany difference plug account (IntercoDiffPL).

INTERCOMPANY ACCOUNTS NON-

INTERCOMPANY
ACCOUNT
SALES - INTERCOMPANY PURCHASE - INTERCOMPANY InterCoDiffPL
500 600 -100

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Open Intercompany Periods

The period must be open before you can enter intercompany transactions.

Open Intercompany Periods

You must open the intercompany period before you can enter any
intercompany transactions in it.You can specify a matching tolerance for the
period and input separate
matching tolerance amounts for transaction ID, account and manual tolerance.
You can also select the option for matching and validation:
If you select the Match/Validate Before Post option, you must match
transactions or assign a reason code before they can be posted. All
matched transactions or mismatched transactions with reason codes
must be posted before a period can be closed or an entity can be locked.
If you select the Restrict option, transactions must be matched before
you can post them, but you can close periods or lock entities that have
unposted transactions.

Creating Intercompany Transactions

Financial Management provides two methods from which you can create
intercompany transactions:
Load intercompany transactions from ASCII files.
Manually enter transactions from the Process IC Transactions window.

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Loading Intercompany Transaction Files

The Load IC Transactions window enables you to load transaction details
from external
ASCII files.
To Load IC Transactions:
1. From the Browser View, select Load Tasks > Load IC Transactions.
2. Select the delimiter character (@, #, $, %, ^, &, |, :, ; ?, \)
3. Select Load Method
4. Click Browse and select the file to load.
5. Click Open.
6. Click Load.

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About Process IC Transactions

The Process IC Transactions window is the main window from which you
perform most intercompany transaction processes. You use the Process IC
Transactions window for these tasks:

Create Intercompany Transaction

View Intercompany Transactions

Edit Intercompany Transactions

Match Intercompany Transactions

Unmatch Intercompany Transactions

Post Intercompany Transactions

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Unpost Intercompany Transactions

Filter Intercompany Transactions

Delete Intercompany Transactions

Report on Intercompany Transactions

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Creating Transactions from Process IC Transactions

You can manually enter intercompany transactions from the Process IC
Transactions window. To navigate to the Process IC Transactions window,
select Tasks > IC Transaction Tasks > Process IC Transactions. Click New to
create an intercompanytransaction.

Matching Intercompany Transactions

Before you post intercompany transactions to a Financial Management
intercompany account, you can perform a matching process to ensure that
both the entity and its partner have completed entering the transaction.
If your administrator set up the period to require matching before posting,
you must match the transactions before you can post them.

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Locking Entities
You can apply a lock to an entity for a scenario, year, and period to prevent
future changes to intercompany transactions for the entity. If the
Match/Validate Before Post option is selected for the period, all matched
transactions and all mismatched transactions with a reason code must be
posted before the entity can be locked.
When an entity is locked, you cannot enter new intercompany transactions for
the entity. You are also cannot delete or make changes to existing transactions
for the entity. You cannot post or un-post transactions to a locked entity, or
update the match status of a transaction that involves a locked entity.
Therefore, even if the partner entity is not locked, the partner cannot match
transactions because the match status cannot be updated for the entity.

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Closing Intercompany Periods

At the end of the closing cycle after you finish processing intercompany
transactions, you can close the period to prevent additional modifications to
the transactions. If the Match/Validate before Post option is selected for the
period, all matched transactions and all mismatched transactions with a
reason code must be posted before the period can be closed.
When you close a period, the period is locked for future transactions.
However, you can continue to view transactions and run reports on the
transactions for the period.

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Setting Up Entities for Intercompany Data

You must set the IsICP property for all entities that act as intercompany
partners and have intercompany data.
The SecurityAsPartner property assigns the security class to be used for an
entity when the entity acts as an intercompany partner in the ICP dimension.
For example, you may want users in Europe to be able to enter intercompany
transactions between European entities and United States entities, but not be
able to modify data for United States entities. To achieve this objective, you
make the following security assignments:
• For United States entities, you assign USA for the Security Class property and
Intercompany for the SecurityAsPartner property.
• You give users in Europe read-only access to the USA security class and
read-and write access to the Intercompany security class. Thus, you enable
users in Europe to enter data for United States entities only when the entities
are selected in the ICP dimension.

Monitoring Intercompany Entity Status

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The Monitor Intercompany Transactions task provides a status overview for

your intercompany entities. You can filter the list of entities by any
combination of these statuses: Started, Not Started, Not Lockable, Lockable,
Locked.
• An entity has a status of Started if has at least one intercompany transaction
for the scenario, year, and period in the point of view.
• An entity has a status of Not Lockable if the Match/Validate Before Post
option is selected for the period but there are matched transactions, or
mismatched transactions with a reason code, that have not been posted.
You can click an entity in the list to view a pop-up window with additional
detail for the entity. The detail window displays the total number of posted
and unposted transactions for the entity, categorized by matching status.

Setting Up Accounts for Intercompany Data

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To use accounts in intercompany transaction processing, you must set two

member properties:

• IsICP—To flag the account as an intercompany account

• PlugAcct —To store differences between intercompany balances

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