Tools & technology
Intercompany Netting Software
Intercompany netting software consolidates multiple intercompany payables and receivables across group entities into a single net settlement per currency or entity pair, reducing the number of cross-border payments and associated foreign exchange costs. It typically operates on a periodic cycle, aggregating invoice data before.
The software collects open intercompany invoices from accounts payable and receivable ledgers, matches offsetting balances between entity pairs, and calculates net positions by currency. A netting cycle, often monthly, produces settlement statements and payment instructions, which significantly reduces the volume of individual.
Integration with treasury management systems and enterprise resource planning platforms allows automatic posting of netting settlements back to the general ledger, maintaining an audit trail linking each net payment to underlying invoices. This traceability supports transfer pricing documentation by demonstrating that.
In practice
What matters when applying intercompany netting software
- Aggregates intercompany balances into net settlements
- Reduces cross-border payment volume and FX cost
- Runs on periodic, typically monthly, cycles
- Integrates with treasury and ERP systems
- Maintains audit trail linking payments to invoices
Frequently asked
Common questions
How does netting software reduce foreign exchange costs?+
By consolidating many gross intercompany payments into a single net amount per currency pair, the software cuts the number of foreign exchange conversions and cross-border transfers, lowering bank fees and spread costs compared with settling each invoice.
Does netting software affect transfer pricing settlement evidence?+
Yes, netting reports provide a documented link between individual intercompany invoices and the net settlement amount, supporting evidence that management fees, royalties and cost charges were settled consistently with agreed intercompany terms.
See how the tooling handles this in practice
Our transfer pricing tools calculate intercompany charges, benchmark financing and reconcile the intercompany ledger from your own data. Book a short walkthrough and we will show the workflow on a scenario that matches your group structure, rather than a generic demo dataset.