Understanding InterUnit and IntraUnit Billing

In an enterprise billing system, transactions often cross divisions or companies within large organizations. To help you keep track of these cross-organizational billing transactions, PeopleSoft provides InterUnit billing.

For example, when Division A of an organization loans labor to Division B, InterUnit billing generates accounting entries for booking to Division A's revenue account, Division B's expense account, and corresponding InterUnit control accounts. Although no accounts receivable open item or invoice is generated, you can track the transaction within the system.

In another instance, where Organization A sells parts to Organization B (where both are business entities of an enterprise organization), Organization A can use InterUnit billing to bill Organization B for the transaction. The process generates accounting entries for both Organization A's and Organization B's books. You can set up the process to generate an accounts receivable open item for Organization A, an accounts payable voucher for Organization B, and an invoice.

In bill entry, when you enter an InterUnit customer, the Bill To Business Unit page appears if the InterUnit customer that is provided has no default General Ledger business unit. You can reenter the bill-to GL (bill-to general ledger) unit for this customer by clicking the Bill To Unit button, which appears on the Header - Info 1 page (and the Billing General page in the express billing component) when you select an InterUnit customer. The system populates the account distribution information with default values. Accounting distribution information can appear by default from the InterUnit Pairs table, the IntraUnit Template table, or the InterUnit Template table. The system uses a default value that is based on the value that you select for the InterUnit Method field on the Installation Options - Overall/GL page. You can override these ChartField values on the corresponding bill entry pages.

Note: When you elect to create accounts payable vouchers, no account payable ChartField information appears in bill entry.

Invoice InterUnit bills by using the same invoice finalization process that you use to invoice regular bills.