Property Groups · Track 1 · Tutorial 2 of 2
Clear intercompany items in a property group
The same items come round every month. This is how to clear each one in BrizoConsol, in the order that closes the month cleanly, with links to the accounting behind them.
1Know the items
Each item is cleared under the type set up for it in Set up intercompany types for a property group.
2Clear each item
| Item | Type | How to clear it | See |
|---|---|---|---|
| Loans from the holding company to SPVs, and their interest | SPV Loans | A rule per SPV on the loan and interest accounts. Reconcile both sides first: accrued interest and repayment dates often differ. | Eliminate loans and interest |
| Management fees on rent collected | Management Charges | A rule on the fee accounts. Resolve an accrual booked on one side only before the month is posted. | Eliminate management charges |
| Rent between group companies | Rental / Lease Adjustments | A rule for rent against rent; an entry from the lease schedule when the tenant recognises a right-of-use asset. | Make rental and lease adjustments |
| Dividends from SPVs | Dividends | A GL entry in the month each dividend is recorded. | Eliminate intercompany dividends |
| A building sold by the development company to an SPV | Fixed Assets | A GL entry taking the development profit out of the building. If the building is in a Non Current Asset account, which Fixed Assets doesn’t accept, use Other Eliminations. | Eliminate fixed asset transfers |
| Unpaid fees and rent | Trade Receivables / Payables | A document entry at each month end. | Eliminate trade receivables and payables |
A rule suits an item that recurs on accounts holding nothing else; see the Automate with rules track. When the accounts also hold outside business, clear the item from its invoices and bills instead.
3Close the month in order
- Load every company’s month, so the rules run on the consolidation with both sides in place.
- Enter the document entries for unpaid balances at the month end.
- Enter the GL entries for one-off items in the month: dividends, asset transfers, new loans.
- Clear Intercompany → Elimination Review, as in Work through Elimination Review.
- Check each type on Review → Month End Status, as in Check eliminations on Month End Status.
Check
On the group’s Balance Sheet and Profit & Loss with Show Entities on, every intercompany line is zero in the group column, and nothing for the month is waiting in Elimination Review.
4Read more about the accounting
The BrizoConsol blog goes through the accounting behind these items for a property group, with worked examples:
5If something goes wrong
| An item is still in the group figures | Its accounts aren’t in a rule or entry, or one company booked it in another month. Check both companies’ books for the month. |
|---|---|
| The same rule waits in Elimination Review every month | Its method or tolerance doesn’t suit the usual difference. See Explain and clear intercompany differences. |
| A rule also eliminates outside business | The account isn’t only intercompany. Delete the rule and clear the item from its invoices and bills. |
Want more detail? See the documentation