Intercompany Eliminations Playbook — Confirm Early, Close Clean

Two entities, one story (and zero screenshots, please).

No-one loves an ‘Intercompany cliff-edge reveal’: Day 0 arrives, balances don’t agree, and everyone goes digging for “evidence” in chat threads. The fix is simple, if not glamorous—confirm earlier, match systematically, and route disputes to people who can actually decide. This playbook gives you a cadence for confirmations, a short list of matching rules, and a dispute lane that doesn’t derail the close. By the end, eliminations will be predictable, explanations short, and late-night archaeology retired (cape not included).

Day-in-the-life: before → after

Before: A receivable in Paris meets an unrecognised payable in Chicago. Screenshots fly. “Who owns this counterparty?” “Which rate did you use?” The spreadsheet says one thing; the ERP says another. People work hard; the process makes them work harder.

After: Pairs are assigned owners. Weekly confirmations catch small deltas. A dispute lane routes pricing questions to Ops; currency questions to Treasury. Day −1, balances agree within materiality; Day 0 elimination is quietly boring (delightfully so).

So what? Confirming early turns cliff-edge surprises into Tuesday tasks.

Confirmation cadence by transaction (table)

So what? Different flows, different clocks—set the right rhythm and IC stops tripping you.

Before vs After: five IC switches

• From “who owns this?” → publish counterparty owners and SLAs.
• From screenshots → confirmations from governed reports with timestamps.
• From inbox debates → a dispute lane split by root cause (price vs rate vs timing).
• From Day 0 guessing → Day −1 tolerance rules (auto-accept within £/€/$ X).
• From free-text journals → standard IC true-up entries with evidence (see auditor-ready adjustments).

So what? Five small switches collapse noise and concentrate effort where it counts.

IC mismatch triage & default actions (table)

So what? Label the break, route to the right lane, and stop arguing in the wrong room.

Stakeholder talk tracks

CFO: “No end-of-month surprises.” — Weekly confirmations + Day −1 tolerance rules = quieter Day 0 and cleaner eliminations.

Controllers: “Tell us who decides.” — Counterparty ownership list + dispute lanes (Ops/Treasury) remove guesswork (and calendar ping-pong).

Treasury: “Use one rate story.” — Stamped pack with timestamp; FX differences classify cleanly and roll into CTA. See the FX translation guide.

Audit: “Show me the trail.” — Confirmations, evidence, and approvals live with entries; sampling is confirmation, not excavation.

So what? Clear talk tracks make adoption a non-event—and speed follows.

Objections & responses + real-world moments

• Objection: “Weekly checks add meetings.” — Response: Exceptions-only, 15 minutes, three metrics.
• Objection: “Edge cases won’t fit.” — Response: Keep an escalation lane; design the routine for the 80%.
• Objection: “Evidence lives in ERP.” — Response: Link or export; approvers need it where they approve.

• Quarter-end license fee: Estimate Day −3, confirm Day −1, true-up on invoice—no Day 0 drama.
• Freight in transit: Timing noted; within tolerance auto-accept; reversal next period.
• Wrong markup applied: Ops updates rate card; journal with contract excerpt attached.
• Different FX dates: Revalue using the stamped pack; CTA note updates automatically.

So what? Most “gotchas” turn into tidy tasks when the lanes exist.

Pitfalls → fixes

Pitfall 1: Everyone confirms with everyone.
Fix: Assign counterparty pair owners; one list to rule them all.

Pitfall 2: Tolerance set to zero.
Fix: Use materiality by entity/transaction; escalate ageing, not tiny pennies.

Pitfall 3: Disputes in inboxes.
Fix: Ticket by category (price/rate/timing/mapping) with SLA and attachments.

Pitfall 4: Evidence scattered.
Fix: “No proof, no post” for IC journals and confirmations.

Pitfall 5: Dry-run that isn’t real.
Fix: Run Day −2 with the same rate pack, mappings, and hierarchy as Day 0 (rehearse the actual play).

So what? A few guardrails remove the classic IC friction without adding bureaucracy.

30–60–90 plan to operationalise IC

Days 0–30 — Stabilise: Publish the counterparty owner list and the weekly confirmation calendar. Set provisional tolerances by transaction type. Pilot with two regions.

Days 31–60 — Streamline: Stand up dispute lanes (price/rate/timing/mapping) with SLAs. Introduce the stamped rate pack. Add a Day −2 dry-run and a Day −1 lock for IC.

Days 61–90 — Scale: Roll out globally; automate nudges for aged items. Link IC evidence and approvals to the workflow cockpit and ensure linked disclosures update post true-up (see disclosure management).

So what? Three sprints move IC from “fire-drill” to “routine.”

How CCH Tagetik helps with intercompany

If you’re running a platform like CCH Tagetik, wire these routines into the rails: matching rules at load, a dispute lane with owners, stamped FX packs, and approvals that travel with the journal. You still make the judgement calls; the system removes the scavenger hunt (cape still optional).

Practical tip: Set a Day −1 auto-accept tolerance in the tool (by entity & transaction) and steer energy to aged, material breaks.

So what? Configure once; reap the benefit every month—quietly.

Metric that matters

% of intercompany balances confirmed by Day −1 (target > 95%). Pair with aged IC disputes > 3 days and Day 0 IC adjustments by count/value. When the routine works, confirmations rise, ageing falls, and Day 0 posts are rare—and small.

So what? What you confirm early can’t surprise you later—measure early certainty.

Assign owners, confirm early, let Day 0 be boring.

Publish the counterparty list, run weekly confirmations, and lock IC on Day −1 with materiality rules. Tie the routine to your close cadence and keep FX and disclosures aligned through the FX guide and disclosure playbook. The result: clean eliminations, calmer closes, and fewer archaeology projects.

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