How to Bill and Reconcile Interoffice Costs

Overview

Use Accountability’s Interoffice Cost Sharing feature to automate cost sharing between offices. Create and post intercompany invoices, keep AR/AP balanced, and ensure accurate reconciliation across entities.

Why Use This Feature

Agencies often collaborate across offices, but shared expenses can create reporting challenges. Without a structured interoffice process, costs may be duplicated, left unbilled, or reconciled manually at month-end.

Interoffice Billing solves these issues by:

• Ensuring each office bears its true share of costs.
• Creating synchronized Client and Supplier Invoices automatically.
• Maintaining accurate AR/AP balances without additional journals.
• Simplifying audits and intercompany reconciliations.

Example Use Case:

Your New York office pays a supplier for a global software subscription that also supports your London team. Instead of manually recharging London through journals, New York issues an Interoffice Client Sundry Invoice to London. Accountability automatically creates the corresponding Supplier Invoice in London’s books—balancing both offices’ ledgers instantly.

Prerequisites:

Master Data Setup

Your Accountability Admin must complete the following set-up steps before processing interoffice expense recharges.

1. Define Intercompany Client and Supplier Types

• Navigate to MASTER FILES > Clients > Client Types.
  • Click New Client Type → Enter Intercompany → Click Save.
• Navigate to MASTER FILES > Suppliers > Supplier Types.
  • Click New Supplier Type → Enter Intercompany → Click Save.

2. Create Interoffice Accounts

Ensure the following GL accounts exist in ACCOUNTING > General Ledger > General Ledger Accounts:

3. Create Posting to GL Account Records

Map your Intercompany Client and Supplier Types to the correct AR/AP accounts.
Navigate to ACCOUNTING > General Ledger > General Ledger Accounts > Posting GL Accounts.

4. Create Intercompany Client and Supplier Records

Each interoffice relationship requires a dedicated client and supplier.

Tip: Apply a Country Restriction if you want to define defaults such as tax codes or currencies per country.

Set Up Interoffice Billing

• Open the Intercompany Client record (e.g., ICLON).
• Click settings link at the top of the page and choose Interoffice Billing .
• Complete the fields as follows:

• Click Save.
  These rules define how Accountability will automatically generate a Supplier Invoice in the receiving office when the originating office approves a Client Invoice.

Process Intercompany Expense Recharges

You can identify shared costs between offices using the Inter-Office Reconciliation Report and then process Sundry invoices depending on the source of the expense.

Step 1 – Run the Inter-Office Reconciliation Report

• Navigate to Accounting>General Ledger > General Ledger Statements and Reports> General Ledger Reports > Inter-Office Reconciliation Report.
• Select your Date Range.
• Choose the option Detail or Summary
• Select the Offices you want to include in the report. (Note you can choose filter data to selected office only to see only the transactions between those offices)
• Review all cross-office transactions and determine which amounts should be billed.
• Export or note these totals before proceeding.

Step 2 – Create a Client Sundry Invoice

• Navigate to ACCOUNTING > Receivables > Client Sundry Invoices.
• Click New Invoice.
• Select the Intercompany Client (e.g., ICLON).
• Add your GL Account (e.g., Accrued Expenses or Interoffice Clearing).
• Enter the Amount to recharge.
• Save and Post the invoice.

Once posted, Accountability automatically creates a matching Supplier Invoice in the receiving office’s Incoming Supplier Inbox.

Step 3. Invoice Routing and Reconciliation

When a Client Invoice is posted in Office A (e.g., AMS):

• A Supplier Invoice is automatically generated in Office B (e.g, LON).

1. Navigate to Accounting> Payables>Incoming Supplier Invoices Screen
2. Choose the Supplier Invoice that was automatically generated.
3. On the line-item with the GL Account No. (use the same GL account used when creating the sundry invoice) click Dissect and for Inter Office: choose Office A (e.g., AMS)

Post Supplier Invoice

After posting, the Interoffice Loan account nets zero across offices.

Result

• Each office bears its correct share of expenses.
• Invoices are automatically created and reconciled.
• Financial statements remain accurate and auditable.

Related Articles

• Interoffice Billing
• Interoffice Cost Sharing
• Client Job Invoices – Invoice from Costs

• Interoffice Reconciliation Report