Intercompany Accounts

When you track multiple companies in DPS, you must create intercompany accounts that are available to all companies in your enterprise. DPS uses these accounts to process labor and expense charges for intercompany transactions.

Intercompany accounts can be the same across the enterprise, but they are not required to be the same.

After you set up the accounts in Settings > General Ledger > Chart of Accounts, you identify them as intercompany accounts in Settings > Accounting > Posting Accounts.

Labor Types

Labor types determine which accounts are used when charging labor to projects, phases, and tasks. You create or modify labor types, and assign them to direct and indirect accounts, in Settings > Accounting > Labor Posting.

You probably will not use the same labor types for all companies in your enterprise. To allow for the possibility that Company A may reference a labor type that Company B does not use, you must specify the direct and indirect accounts that DPS should use to process timesheets or labor adjustments that reference "foreign" labor types. DPS uses the intercompany account numbers specified in the Foreign Employee Type (Labor) Posting Accounts fields in Settings > Accounting > Posting Accounts.

Intercompany Accounts and Their Purposes

Intercompany Account	Account Type	Purpose
Accounts Receivable	Asset	DPS debits this account when processing invoices for intercompany billing.
Accounts Payable	Liability	DPS debits this account when you post vouchers for an intercompany transaction.
Suspense	Asset or Liability	When a transaction involves another company, some time will pass between the transaction posting date and the date that you run Intercompany Billing. To support the need to balance accounts during this time, you must create an intercompany suspense account. This account keeps your books in balance until the process of running intercompany billing creates the appropriate accounts receivable and accounts payable entries, clears this suspense account, and redistributes the credit amount to the correct company. In this way, you avoid creating tolerances on the companies' Balance Sheets.
Labor Revenue	Revenue	Set up this account only if the Enable Detail Subledgers for Intercompany Billing option is selected in Settings > Accounting > Posting Accounts. DPS uses this account for labor revenue when generating intercompany invoice transaction files for a company. You must map this account to the company's intercompany AR Account in the Invoice Mapping Accounts grid in Settings > Billing > Accounts Receivable.
Expense Revenue	Expense	Set up this account only if the Enable Detailed Subledgers for Intercompany Billing option is selected in Settings > Accounting > Posting Accounts. DPS uses this account for expense revenue when generating intercompany invoice transaction files for a company. You must map this account to the company's intercompany AR Account in the Invoice Mapping Accounts grid in Settings > Billing > Accounts Receivable.
Intercompany Cash Basis Suspense	Revenue or expense	Set up this account only if both of the following options are selected: Enable Detailed Subledgers for Intercompany Billing in Settings > Accounting > Posting Accounts Cash-basis reporting in Settings > General Ledger > Options DPS uses the intercompany cash-basis suspense account when creating cash-basis entries for intercompany transactions. This should be an indirect expense account, because this account is likely to retain a balance. Depending on your intercompany billing configuration, that balance will represent any markups on intercompany expense transactions or the cash-basis expenses and revenue associated with intercompany entries. DPS uses this account for cash-basis entries when processing the following intercompany transactions: Accounts payable payments, employee expense payments, accounts payable disbursements, and cash disbursements Cash receipts for intercompany billing transactions Payment of intercompany vouchers To ensure that this account is used correctly for intercompany cash receipts, you must specify this account as the cash-basis account for your intercompany accounts receivable account. To do this, select the intercompany cash-basis suspense account in the Cash Receipt Mapping Account grid in Settings > Billing > Accounts Receivable. If you do not complete this step, your intercompany accounts receivable account will have a balance that will not be cleared, and you will have to post a journal entry to clear it manually.
Foreign Employee Type (Labor) Posting Accounts
Direct	Direct Expense Account	DPS credits direct labor charges to this account when you post timesheets or labor adjustments that reference a foreign labor type. Enter the account in Settings > Accounting > Posting Accounts.
Indirect	Indirect Expense Account	DPS credits indirect labor charges to this account when you post timesheets or labor adjustments that reference a foreign labor type. Enter the account in Settings > Accounting > Posting Accounts.