Intercompany netting

Roles that need it

• Corporate Treasury Analyst
• Treasury Analyst
• Group Reporting Accountant
• Treasury Advisory Associate

Skills it belongs to

• Treasury and cash flow management
• FX risk and hedging instruments

Related concepts

• In-house bankAn in-house bank is a group treasury entity that acts as a bank for the group's subsidiaries: it keeps internal accounts for them, nets and settles intercompany flows, lends and borrows internally and makes external payments on their behalf. It concentrates liquidity and foreign exchange risk and reduces the number of external bank accounts.
• Cash poolingCash pooling is a group treasury technique that concentrates or offsets the balances of many group accounts, so that surpluses fund deficits and external borrowing falls. In physical pooling (zero or target balancing) money is swept to a header account; in notional pooling balances are combined for interest only. Tax rules treat pool positions as intragroup loans.
• Payment factoryA payment factory is a central unit or platform that processes the payments of all group companies, using one format (often ISO 20022 pain.001) and few bank connections. In a payment on behalf of (POBO) model the central entity pays suppliers from its own accounts; collection on behalf of (COBO) does the same for receipts.

Sources

• CPMI glossary, Bank for International Settlements (external site) accessed 31 Oct 2026
• OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations 2022, OECD (external site) accessed 31 Oct 2026

Updated 31 Oct 2026.