What common types of intercompany transactions does ICMR handle?

• A. Only cash transactions
• B. Only service transactions
• C. Sales, purchases, loans, and fees
• D. Real estate transactions

Answer: (C)

ICMR, or Intercompany Matching and Reconciliation, is designed to manage a range of intercompany transactions that occur between different entities within an organization. The correct answer encompasses sales, purchases, loans, and fees, which are the key types of transactions that are frequently involved in intercompany dealings.

These transactions are essential for maintaining accurate financial records across multiple entities, ensuring that all parties involved can reconcile their accounts accurately. Sales and purchases represent the core business activities that one entity may engage in with another. Loans pertain to the funding supplied by one entity to another, while fees are often associated with services rendered internally within the corporate structure.

This range of transaction types reflects the comprehensive nature of ICMR, as it facilitates the necessary coordination and transparency for effective financial management and reporting among interconnected subsidiaries. In contrast, focusing only on cash transactions, service transactions, or real estate transactions does not account for the complete spectrum of intercompany financial interactions that ICMR addresses.