Inter company owings

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shehna

shehna (Querist)
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31 August 2016 can anyone plz explain about inter company owings and their elimination

Shridhar Hegde

Shridhar Hegde (Expert)
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31 August 2016 1. Intercompany debt - Eliminates any loans made from one entity to another within the group, since these only result in offsetting notes payable and receivable, as well as offsetting interest expense and interest income.
2. Intercompany revenue and expenses - Eliminates the sale of goods or services from one entity to another within the group. This means that the related revenues, cost of goods sold, and profits are all eliminated.
3. Intercompany stock ownership - Eliminates the ownership interest of the parent company in its subsidiaries.

I hope you are clear now.

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