What must be configured before running an intercompany journal entry?

To effectively run an intercompany journal entry, it is essential to have the intercompany settlement rules and relationships configured. These rules define how transactions between different entities within the organization will be processed and settled. They establish the framework that governs the accounting and financial interactions between companies, including the necessary approvals, transaction types, and methods of settlement. Without this configuration, the system would lack the necessary guidelines for managing intercompany transactions, which could lead to inaccuracies in reporting and reconciliation.

Other components, such as payment methods or currency defaults, play important roles in overall financial management but are not specifically required for executing intercompany journal entries. The focus on intercompany settlement rules ensures a smooth and compliant handling of these specialized transactions.