Example of Intracompany Organization Configuration

The following example explains Intracompany Invoices.

In this example, Vision Corporation has one legal entity, Vision Operations Legal Entity which is associated with multiple intercompany organizations within the corporate structure. In the following configuration, the Vision Operations intercompany organization provides goods to Vision Administration intercompany organization and in other circumstances Vision Administration provides services to Vision Operations. The business has a requirement for each of these intercompany organizations to be able to invoice the other as well as record a payables invoice received from the other intercompany organization.

Intercompany Organizations Setup

The following figure illustrates the Intercompany Organizations Setup.

The following figure shows how intercompany organizations, Vision Operations and Vision Administration generate invoices and record Payables invoice from the intercompany organization. Vision Operations is an Intercompany organization that has a legal entity called Vision Operations Legal Entity. Vision Operations Legal Entity has Payables Business Unit and Receivables Business Unit. Vision Administration is the other Intercompany organization that has a legal entity called Vision Operations Legal Entity. Vision Operations Legal Entity has a Payables Business Unit and Receivables Business Unit.

The following figure illustrates the Customer And Supplier assignments.

The following image shows that Vision Operations Legal Entity is assigned to Customer Account 456 and Supplier 123.

The following table describes the Intracompany Organization as a Provider:

Type	Intercompany Organization	Legal Entity	Receivables Business Unit	Payables Business Unit	Comments
Provider	Vision Operations	Vision Operations Legal Entity	Operations AR	Operations AP	AR invoice is created in Operations AR business unit which is the receivables business unit of the Provider. Customer is the one assigned to Vision Operations Legal Entity.
Receiver	Vision Administration	Vision Operations Legal Entity	Operations AR	Administration AP	AP Invoice is created in Administration AP business unit which is the payables business unit of the Receiver. Supplier is the one also assigned to Vision Operations Legal Entity

The following table describes the required Customer Supplier Assignments Setup.

Type	Legal Entity	Customer Account	Customer Site	Supplier	Supplier Site
Provider	Vision Operations Legal Entity			Supplier 123	Supplier 123 must have a site with Primary Pay site purpose enabled in Administration AP business unit
Receiver	Vision Operations Legal Entity	Customer Account 456	Customer Account 456 must have a Bill To site in Operations AR business unit.

The following table describes the Invoices created.

Type	Intercompany Organization	Legal Entity	Invoice
Provider	Vision Operations	Vision Operations Legal Entity	AR Invoice 101 raised for Customer Account 456 in Operations AR business unit
Receiver	Vision Administration	Vision Operations Legal Entity	AP Invoice 101 recorded for Supplier 123 in Administration AP business unit