Hi,
In cross company transactions several company codes are involved . In a cross-company code transaction, the system posts a separate document with its own document number in each of the company codes. Individual documents are linked by a common cross-company code number. The system generates line items automatically (receivables and payables arising
between company codes) in order to balance the debits and credits in each document.
For e.g: One comapny is paying its affiliate company;
Paying company entry: Dr: Payable to Affiliate
Cr: Bank Accoount
Receving Company entry: Dr : Bank Account
Cr: A/R from Affiliate.
Both companies accounts are updated with the single entry.
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