Dilip Sadh

sadhdilip@yahoo.com

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 Intercompany Processes

Intercompany business processing describes business transactions which take

place between two companies (company codes) belonging to one organization.
The ordering company orders goods from a plant which is assigned to another
company code.
The following intercompany business transactions are possible:

• Intercompany sales processing

• Intercompany stock transfer

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 Intercompany Stock Transfer Process

• A purchasing organization which is assigned to the ordering company code

creates a purchase order ordering goods from a plant assigned to another
company code.
• The plant in the delivering company code delivers the goods to the plant for
which the purchasing organization ordered the goods

• Because the two companies balance their accounts independently, the

delivering company must bill the ordering company for the goods.
•This internal billing transaction is carried out by means of an intercompany
billing document. The delivering company bills the ordering company at a price
that allows the delivering company to cover its costs

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 Transfer Price

When a delivering plant invoices a sales organization, the plant can use one of
the following condition types:

• PI01 Intercompany: fixed amount per material unit

• PI02 Intercompany: percentage of the net invoice amount

• These condition types specify that the price charged by the delivering plant to
the sales organization is shown as a statistical value in the sales order and an
effective charge in the internal invoice.
• The condition records you create and maintain for intercompany billing are the
same kind of records that you create for pricing in general.

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 Cross-Company Postings
(i.e. Plant to Plant transfers)
Example: CO-PA:
Product shipped from plant GB01
(company GB00) to plant FR01 ZI00 Cross Company Revenue
(company FR00)
Netting
Plant GB01 DR A/R Inter-Company DR Bank
CR Sales Inter-Company CR A/R Inter-Co
VL01N VI01 VF01 F110

Create Create & Create Invoice Manage

Delivery Complete Shipment Plant Accounts
Customer

Note Shipment Cost (ZI) Rec.

to Cash

Post Goods Issue (auto)

DR COS @ Std
CR Inventory Output RD04

Plant FR01 MIRO MIGO Netting

DR GR/IR DR Inventory DR A/P Inter-Co
CR A/P Inter-Company CR GR/IR CR Bank
Purchase
to Pay

Auto-Release
Create Manage Manage
Receive
Purchase Accounts Accounts
Goods
Order Pay. Payable

Goods In Transit (MB5T) F110

Month-End (reversing)
5 DR Goods in Transit
CR GR/IR
 Intercompany Sales Process

• A sales organization which is assigned to the ordering company code creates a sales
order ordering goods from a plant assigned to another company code.
• The plant in the delivering company code delivers the goods to the customer for
whom the sales organization placed the order

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 Flow for Inter-Company Customer Sales

Customer

Plant CA01
Sales Area for IV Billing
Sales Org. CA00 Sales Org. US11
Dist. Channel 99 Dist. Channel 20
Division 99 Division 11
Comp. Code CA00 Comp. Code US11
Sourcing
Plant Selling Sales Area

3. Create Clear Inter-

Commit 1. Ship 2. Invoice Create Inter- Company
Inter-
Order Product Customer Company Accounts
Company
VA01 VL01 VF04 Payable F110
Invoice*
VF04
CA00 US11

DR A/R Trade DR A/P Inter-Company (Vendor CA00)

CR Sales CR COS Inter-Company

DR COS DR A/R Inter-Company (Customer US11)

CR Inventory CR Sales Inter-Company
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* RD04 Message Output triggers IDOC outbound/inbound processing to post A/P entry
Conclusion for Intercompany sale process.
• Select Standard Sales order type
• Enter Sold to / Ship to
• Enter Sales order in Sales area of receiving Plant
• Check various Pricing condition.
• Enter Supplying plant at line item level in Sales order.