USA Timing in intercompany transactions


AGH the CPA

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Parent company A based in US ships product to sub Z based in Europe at month end. On parent's books, DR Sub Z AR CR sales
Sub Z doesnt receive shipment until next month so doesnt record transaction.

When parent does consolidation, their numbers are off because Sub doesnt show AP or inventory receipt yet.

How best to handle this?
 
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kirby

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Question - does parent sell at parent's cost to Sub?
 
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kirby

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But to address YOUR question: as part of month-end close, parent should send to sub a listing of parent-sub transactions per parent's books. Sub should then reconcile to that and record any missing transactions. Inventory not yet received can be recorded as inventory in transit or something similar.
 

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