Managing multiple entities can become cumbersome when transactions need to apply to separate entities simultaneously. Many companies struggle with keeping their General Ledger balanced when they allocate a receipt to a customer in one company and have the receipt go into a bank account in another company. Accounts receivable can be troublesome as well when a payment is processed against a vendor in one company but the payment comes out of a bank account in another company.
Inter-company transactions can also require a heavy amount of data entry. If an organization engages in activities such as distributions to various partners, transfers of funds, or payments made through operating companies on the behalf of subsidiary entities, they are required to enter the same transaction in accounts receivable and accounts payable across all entities.
Brewery Works, a commercial development firm focused on preserving the Schlitz Park area of Milwaukee experienced many of these issues. Each building is set-up as a separate entity within Sage ERP Accpac but many of their transactions span more than one entity. The Brewery Works staff previously entered each transaction into each entity that was involved, and separately tracked the due-to / due from balances in Excel to keep inter-company balances reconciled. The Inter-Entity module automated this time-consuming practice by enabling them to input a transaction once, which then simultaneously updates each individual entity’s financial record. Even better, it manages the due-to / due from process between entities so they no longer have to track it outside of the system; saving time and reducing overtime expenditures.