Hi All,
What is the relationship between Centralized Payment and Intercompany?
Intercompany is when we buy or sell between our own legal entities. So if company A sells product to company B (company A and B are our own legal entities). Company B needs to pay back to company A. Cash needs to exchange hands from B to A. So how does the Centralized Payment impact the intercompany transactions? I understand that in the Centralized Payment, the Centralized Payment entity would represent other entities to pay rent, for example, then these entities have to pay back to the Centralized Payment entity. In the Intercompany transactions, company B purchase from company A. Company C (Centralized Payment entity) represents the company B to pay to A. Then B pays back to C? It sounds like an extract step for internal process. Could someone please shed lights to this concept? Thanks so much!