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Use Case 2:  Overview of the intercompany settlement by journal entries, using 3rd party settlement agent.

The settlement agent may be a bank or trusted fiduciary, or, under the simplest scenarios, may be a bookkeeper who either has no power to execute any payments, or executes them only after receiving a payment from the buyer.  The SA performs netting, aggregating and accounting services, and is an essential integration function.  Banks have failed to provide transaction automation on a cost effective basis.

 

 


 

 

Intercompany settlement between internet accounting systems

Steps: 

  1. Establish Settlement Account 
  2. Buyer creates purchase order 
  3. Buyer instructs Settlement Agent to pay 
  4. Settlement agent executes bank payment

The entries within three web ledgers are shown on the slides below. These would be partially automated by business process schemas. The choreography does not require a single host.  Note that this scenario is a straight prepayment scenario, and is only one of many possible intercompany book settlement scenarios.