Hi Platinum,
I will go to an interview this
Friday. They require the bookkeeper to have experience with inter company
accounts and understand how to balance with journal entries for each
entity.
I understand 2 units under one entity can have transactions
with each other, they can sell inventory or service to each other. And when
doing the consolidated financial statement, we have to eliminate the effect of
the intercompany transactions so we won't overstate the sales or
profit.
Is that right? Can I add something to make my answer more
impressive if they ask this question?
And also, the interviewer is a training school, a registered
training organisation, do you have any suggestions on my interview preparation
for this kind of entity?
Really thank you for reading this email,
Your response will be appreciated,
Regards,
Veronica
Hi Veronica,
ReplyDeleteGood to hear that you are making progress on your job hunting.
For inter-co transactions, there are usually two different types of scenarios, one is the inter-co sales which you mentioned below, the other one is the inter-co loan. You will have to make sure both types of transactions are eliminated before consolidation.
I would recommend you to should revisit your uni Corporate Accounting textbook to memorise the general entries before interview. Also in future, if time allows, I would recommend you to take our level 2 training which will cover all the details regarding inter-co transactions.
For the accounts of a training school, I believe they will have stock/inventory (text books, training materials) related transactions too. It would be a good idea to look into those as well.
Good luck with the interview and bring back some good news.
Regards,
Florian
Great article.
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