How are intercompany expenses tracked and reconciled?
Short answer
Intercompany expenses are costs and transfers between related entities within your corporate group. On Ramp, multi-entity organizations largely eliminate the need for intercompany transactions by assigning spend to the correct entity from the start, paying each entity's expenses from separate bank accounts, and syncing directly to entity-specific books in your ERP.
What intercompany expenses are
Intercompany expenses are costs between related entities within your corporate group—such as service fees, shared cost allocations, management fees, or transfers between parent companies and subsidiaries.
How Ramp reduces intercompany reconciliation
Ramp keeps entities separate from the beginning:
- Entity-specific assignment: Cards, transactions, reimbursements, and bills are assigned to specific entities
- Separate statement payments: Each entity pays its own statement from its designated bank account
- Direct ERP sync: Transactions sync to the correct entity in your ERP with proper coding
- Automated intercompany entries: For Sage Intacct and Workday, Ramp can automatically create intercompany journal entries when bills are split between entities
When intercompany entries are still needed
- An employee's card is tied to Entity A but codes an expense to Entity B
- Bills are paid by one entity on behalf of another
- Shared costs need allocation across entities
For these scenarios, supported ERP integrations can automate the due-to/due-from journal entries.
Related questions
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