Definition

This process manages different cases of outstanding AR/AP to be cleared related to:

• partners dealing as a customer and vendor
• complex contracts with 2 or more business roles
• etc.

It is often needed to confirm that offset with the counterparty before posting clearing transactions. Signed offset agreements as an example of that confirmation. 

Business process diagram

How to review opposite AR/AP amounts

Go to the Intercompany AR/AP open items report.

Use Settings to change the structure of the report and set filters.

Specify the Period.

Select the AR/AP objects checkbox and Generate the report.

Find the AR/AP object that is relevant to the invoice.

Review the information about accounts payable and receivable by the AR/AP object.

Find the amounts in the Accounts receivable and Accounts payable columns within the combination of Companies of the Group.

How to perform AR/AP clearing within single company

Go to the Intercompany invoice document, go to the Main tab.

Click Payment offset.

In the Offset payments: workplace, go to the Other prepayments tab.

The system will prepare the list of prepayments to/from the counterparty that:

• Took place before the invoice date.
• Aren't connected to the Contract of the AR/AP object.
• Have a different AR/AP object.

Select the By all counterparty contacts filter.

Select the item and click Set-off /Transfer advance.

Correct the amount for the list of documents in the Set-off section (below).

Click Execute to create the AR/AP offset document that clears the amount of the payment document against the amount of the AR/AP object.

How to perform AR/AP clearing for multiple legal entities

Go to AR/AP offset list.

Create the AR/AP offset document and open the Transaction.

In the Offsetting setup wizard:

Select the Arbitrary offset in the Transaction section.

Select the Customer company or Vendor company in the Debtor field.

Select the Customer company or Vendor company in the Creditor field.

Choose the AR/AP object.

Fill in all the necessary fields on the Accounts receivable and the Accounts payables tabs.

How to update and confirm payment request

Go to the Intercompany invoice document.

Click the Reports → Related documents command.

In the Related documents report

Find the relevant Payment request.

Open the Payment request.

Set the Approved status.

Write any relevant comments on settlements performed in the Note field.

Post and close the payment request.