A GAAP Compliance solution for Intercompany Accounting from Oracle eBusiness Suite

Accounting concepts revolve around the concept of Generally Accepted Accounting Principle/Policies often referred to as GAAP. The two most fundamental principles among these are

In a typical manufacturing and distribution setup environment, intercompany dropship scenario is the need of the hour (Also referred as Factory Direct Process in some cases). In an intercompany drop ship case, the intercompany invoice creation is not interrelated or dependent on the external customer invoice creation. This can create a mismatch between the revenue and COGS at the Selling Operating Unit (OU) and hence will not be of GAAP compliance.