NetLoan - Non-Eliminating Intercompany Loan Setup
Intercompany loans have the option to have two mirrored journals post or a single Advanced Intercompany Journal. This article focuses on the first option with two mirrored journals that do not automatically eliminate upon consolidation.
Global Application
The setting to determine how intercompany loans book journal entries is a global setting. Because of this, you cannot run both mirrored journals and advanced intercompany journals at the same time in the system. The selection box would need to be checked and unchecked appropriately in the system setup before running sets of journals to have both types running in the system.
Best practice is to choose one method and use it for all intercompany loans in NetLoan.
Setup
1. Navigate to NetLoan > NetLoan Setup > System Setup. Make sure that the "Module Use" is set to a selection that includes "Intercompany" and ensure the box for "Auto Eliminate Intercompany Transactions" is NOT checked.
2. Navigate to NetLoan > NetLoan Setup > Manage Loan Types > New. Create a new loan type for intercompany loans. Ensure that the "Entity Type" is set to "Intercompany". For more information on creating loan types, see the Loan Type Configuration article.
3. Create a custom form. Navigate to Customization > Lists, Records, & Fields > Record Types and select "NetLoan Loan". Create a custom form. Edit the custom form.
4. Adjust the sublists to show the intercompany schedule. On the custom loan form, navigate to the "Sublists" tab, hide the "Installment Schedule" sublist, and show the "Interco Amortization Schedule" sublist.
Creating the Loan
Once the system setup is complete, you can now create the intercompany loan.
Navigate to NetLoan > Loan Management > New Loan. Select the Loan Type as the Intercompany type previously set up. For the Subsidiary, select the lending subsidiary. For the Intercompany Borrowing Subsidiary, select the borrowing subsidiary.
Set up the rest of the loan as normal. See the Create a New Loan Record article for more details.
Running Journals
Journal entries will be run in the usual way. See the article NetLoan Run Monthly Journals for details on how to run journal entries.
For every journal entry run (initial balance entries, monthly amortization entries, etc.), NetLoan will record two journal entries: one from the perspective of the lending entity and one from the perspective of the borrowing entity. Both of those journal entries display on the loan's amortization schedule.
Below is an example of the amortization entry from the perspective of the lending subsidiary (Parent).
Below is an example of the amortization entry from the perspective of the borrowing subsidiary (Canada).