What insights, best practices, or recommendations can you share regarding intercompany invoicing ownership? Our current process involves posting intercompany invoices via configuration rules, but we struggle to have clear ownership for monitoring, review, and reporting. We have situations where, for example, a product is shipped from a country M entity to a customer by a country E entity, resulting in a direct shipment. The trade sale occurs in the E entity, but an intercompany sale is posted between M and E entities. The supply chain initiates the sale but doesn't own the intercompany invoice. IT, accounting, and tax teams are knowledgeable about intercompany processes, but none have ownership for initiating sales or determining shipping locations. While intercompany activity is eliminated from a corporate perspective, it has significant financial implications for country-by-country, e-invoicing, and VAT reporting. This highlights the need for clear ownership to monitor and ensure accurate reporting of these sales.
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Finance Manager in Services (non-Government)a year ago
Ownership should lie with the Invoicing team, who may be doing another category of invoices as well, or the person who is initiating this transaction should own it. It depends upon how the roles and responsibilities are set up in the Organisation hierarchy.
Ideally, when we have an automated invoicing process, there should be a detective management review control in place to ensure the accuracy and completeness of the process, as it has country-specific financial nuances. There can be a team that will review it on a sample basis or 100% per the risk appetite.
Generally, multiple types of intercompany invoices may be raised, so ownership can be segregated with a defined SOP as per the nature of the transaction.
Ideally, you have automated processes that cover invoice, e-invoicing, and tax requirements. If you have a large intercompany footprint, having a dedicated team for intercompany may be needed.