Common Party Accounting

Common Party Accounting handles situations where the same entity is both a Customer and a Supplier. Instead of managing two separate parties, you can link them and offset their balances.

When to Use

• A supplier is also your customer (e.g., you buy raw materials from them and also sell them products)
• You want to net off receivables against payables for the same party
• Simplifying payment processing when dealing with related parties

Setting Up Common Party

1. Create both a Customer and a Supplier record for the party.
2. Go to Accounting > Common Party.
3. Link the Customer and Supplier records.
4. The system will track both AR and AP balances for the linked entity.

Offsetting Balances

When making or receiving payments:

• You can offset the customer balance against the supplier balance
• The system creates contra entries to net the amounts
• Only the residual amount needs actual cash movement

Related Topics

• Customer
• Supplier