1. Introduction
  2. Trading Associate
  3. Intercompany Reconciliation Beneficiaries
  4. Intercompany Reconciliation Procedure
  5. Scenarios
  6. Conclusion


The organisation for group level reporting is facilitated by intercompany reconciliation. A vast quantity of transactions are being created between a subsidiary and its parent company, between two parent firms, or between two subsidies of a parent company as a result of the graph of industries with their subsidies expanding globally nowadays.

Through ICR, the group accountant may keep track of the accounting transactions between the group of enterprises on a daily, weekly, and periodic basis. If a related company is using another ERP, the data may be obtained from that system as well as from SAP.

On the company or partner company level in SAP, ICR tool.

Due to the enormous volume of transactions, the most difficult and time-consuming task is to reconcile the receivable and payable data between the intercompany trading partners.

ICR can be executed at any time, but it is most beneficial when an accountant does month-end or year-end closing tasks. The pressure may be avoided, and the results are produced using the desired configurational parameters.

Partner in Trading:

This is the phrase we use to refer to any business partner who is a member of the same group of companies as us or from a different group of companies and with whom we conduct business or who is responsible for any type of payables and receivables.

The field VBUND in a business partner’s master data contains information about their trading partner. For instance;

Intercompany Reconciliation Beneficiaries:

  1. Accountants from one legal organisation who generate payables and receivables to another legal entity within the group of enterprises or who shares a trading relationship
  2. The accountants of the legal entity that generates payables and receivables to the other legal entity of a different group of companies, or, to put it another way, they have various trading partners.
  3. The group accountant should have an accurate picture of all companies, whether they are group members or not.
  4. To monitor the results, the parent firm can control it globally.
  5. The benefit of knowing how many documents are outstanding with their parent firm might likewise benefit a subsidiary company.

ICR processes:

  1. Method 001 (GL Open Items) When the business posted the majority of its intercompany receivables and payables on GL accounts, we used it.
  2. Method 002 (GL Accounts) We employ this procedure for profit and loss accounts as well as GL accounts that are not open item managed.
  3. Customer/Vendor Open Items Process 003 When posting the majority of intercompany receivables and payables in customer and vendor accounts, the company uses this method.


In this article, we describe some of the most typical cases that demand a long reconciliation process. Different groups of firms will have different scenarios depending on their business objectives and requirements.

Due to the fact that the majority of intercompany transactions are based on customer and vendor accounts, we’ll utilise procedure 003 as an example of how ICR simplifies our lives in the sections that follow.

These scenarios are explained:

  1. ICR between various company codes within the same corporate group or with the same trading partner.
  2. ICR between company codes of various business groups or trading partners.

Please review the scenario and the configuration step to carry out ICR now.


ICR between various company codes for the same group of businesses or trading partner.

We have two company codes, NP02 and BU01, that belong to the same trading partner, B1000, or company group.

These company codes establish a relationship between customers and vendors. Accountancy transactions will therefore be;

If there are sales:

BU01 purchases from NP02 and records;

Dr. xxx, BU01.

Revenue Cr xxx

simultaneously, BU01 registers the purchases.

acquires Dr. xxx

Cr NP02 xxx


System entries:


NP02’s accountant will record the receivable against BU01 at the same time.

Both documents are open items at the conclusion of the period because BU01 hasn’t paid NP02.

The group accountant now requests information regarding the NP02 receivable vs BU01, thus the accountant will carry out the following three steps:

  1. FBICS3 will choose the records.
  2. FBICA3 will automatically allocate the documents.
  3. To manually assign the documents using FBICR3, reconciliation

To choose the documents, we first run the T-code FBICS3 with the following parameters:

The papers will be chosen for assignment in two separate business codes after the ICR tool has been run.

Two papers are chosen and transferred for automatic assignments in ICR for the same trading partner, as seen in the image above.

The T-code FBICA3 is used in the second phase to automatically assign business codes in ICR.

Following execution, the system will assign matched documents automatically by matching the reference fields that we set while customising.

Two records are automatically matched in the image above, but if anything is left off, we have to manually assign it.

The third stage involves checking the assigned documents and manually assigning any remaining ones using the T-code FBICR3.

Execute it

Two of our previously mentioned documents are now given the group account document number, as seen in the image above. The group accountant can quickly obtain the reconciliation as a result, and some documents are currently appearing as requiring manual reconciliation.


Situation 2:

ICR between the company codes of several business groups or trading partners.

Since we are taking into account two different company codes in the second scenario—BU01 from company B1000 and NP02 from business B2000—the pattern of accounting entries would be the same as what we have already covered. However, we shall examine the reconciliation process.

But in Business Partner, we’ll assume that Customer 4200003 is of Company Code NP02, which is a part of Company B1000, and we’ll update the Trading Partner in the Master Data.

Similar to this, we will update the vendor’s trade partner in the vendor’s master data for company code BU01.

Since NP02 is BU01’s vendor in this scenario, B2000 would be the trading partner.

NP02 Accounting Entries

Entries for Accounting in BU01

Now we would run and assign the process between several trading partners. The selection parameters would be, for example, FBICS3, but the t-code would remain the same (Select Document)

All of the paperwork from the various trading partners are chosen after the execution.

In the image above, it is evident that papers from trading partners are chosen to be assigned in the subsequent stage, or automatic assignment in FBICA3.

The completion of assignments would follow the execution of T-code.

In the image above, four papers are automatically assigned to B1000 and B2000, while one document will be manually assigned using the t-code FBICR3.

We can observe the allocated and unassigned documents following the execution of the aforementioned parameters.

Note: In our example, the reference field, INV#922 in the field above, would be used to map the data, and the accountants from both organisations would enter the same number to reconcile the data.



As can be seen, the ICR tool makes intercompany reconciliation simple and efficient. Additionally, the method saves time for the businesses.


@Salman Ali Akber made a contribution.