Before you begin, make sure you have:
Ensure all participating companies are connected to GATHER.nexus
Verify Xero integration is active for relevant entities
Have your cost allocation strategy and percentages defined
Understand which accounts will be used for intercompany transactions
Getting started
From your GATHER.nexus dashboard, navigate to the Group Financial Control section and click on the Intercompany Recharge tile.
(The Intercompany Recharge tile shows "Centrally manage intercompany billing and recharges" - this is your hub for all cost allocation workflows.)
Starting a New Recharge Workflow
Click the Perform button in the upper-right corner to begin creating a new intercompany recharge.
Step 1: Name This Workflow
The first step displays a 4-step process guide on the left sidebar:
Name this Workflow
Choose the Companies
Select the Transaction type, Option, Frequency
Configure & Save
Workflow Naming In the "Name this Workflow" field, enter a descriptive name that clearly identifies the purpose and period:
"Q1 2025 Management Salary Recharge"
"Monthly IT Licence Allocation"
"Head Office Rent - January 2025"
(The workflow name field is prominently displayed with a clear input box and action buttons below.)
Click Save & Next to proceed to company selection, or Cancel to return to the main screen
Step 2: Choose the Companies
After successfully naming your workflow, you'll see a green confirmation message "Configuration name saved successfully" and proceed to the company selection screen.
(The success message appears at the top of the screen, confirming your workflow name has been saved before moving to the next step.)
Company Selection Options You have two methods to select companies for your recharge:
From Group: Click the From Group tab (highlighted in green) to streamline your selection process:
Choose from predefined groups in your GATHER.nexus setup
Ideal for managing transactions across multiple related companies within the same group
Ensures consistency in your intercompany processes
Select the Group Use the "Select group" dropdown to choose your target group. In the example, "Demo Group" is available for selection.
Company Selection Within Group Once you've selected your group, you'll see the available companies displayed with their details:
From Company Selection: Choose the single entity that incurred the original cost. Available options show:
Each company tile displays the company name and its base currency, helping you make informed selections for multi-currency recharges.
(The From Company section shows available entities with their currencies clearly displayed, making it easy to select the cost-originating company.)
Direct Selection Click the Direct Selection tab if you prefer to choose companies individually:
Provides flexibility for managing transactions across various entities independently
Allows selection from all connected companies regardless of group structure
From Company Options (Direct Selection): In Direct Selection mode, you'll see a broader range of companies
To Company Selection: The bottom section shows recipient companies where costs will be allocated
(The Direct Selection view shows all available companies organized into From Company and To Company sections, with search functionality for larger company lists.)
ℹ️Info:You can only select one "From" company (the cost originator) but multiple "To" companies (the cost recipients). Each company tile clearly displays the currency to help with multi-currency considerations.
Search Functionality Use the search bars in both From Company and To Company sections to quickly locate specific entities when dealing with larger company lists.
Once you've made your selections, click Save & Next to proceed to transaction configuration, or Previous to return to the workflow naming step.
Step 3: Select the Transaction Type, Option and Frequency
After selecting your companies, you'll proceed to configure how your intercompany recharge will be processed. The sidebar now shows step 3 highlighted, indicating your current position in the workflow.
(Step 3 is now highlighted in the sidebar, with steps 1 and 2 showing green checkmarks to indicate completion.)
Transaction Type Selection
Choose how you want your recharge to be recorded in your accounting system:
Journal Entry: Click Journal Entry (highlighted in green) to create direct accounting entries:
Creates balanced double-entry bookkeeping across all participating companies
Automatically posts to appropriate accounts in each entity's books
Ideal for most intercompany cost allocations and recharges
Integrates seamlessly with your existing accounting workflows
Invoice: Click Invoice if you prefer to generate formal invoices between entities. Here it will be creating invoice in from company and bill in To company:
Creates proper invoice documents between companies
Useful for formal service charges or where documentation is required
May require additional approval workflows depending on your setup
Transaction Options
Configure the frequency and timing of your recharge:
Single Entry Select Single Entry (highlighted in green) for one-time cost allocations:
Perfect for specific project costs or one-off shared expenses
Creates a single transaction on your specified date
Ideal for ad-hoc recharges that don't repeat regularly
Recurring Entry Choose Recurring Entry for regular, ongoing cost allocations:
Automatically creates multiple transactions based on your frequency settings
Perfect for monthly management fees, quarterly allocations, or annual charges
Saves time by automating regular intercompany processes
(The Single Entry option is initially highlighted, but you can switch to Recurring Entry for automated ongoing recharges.)
Transaction Date Configuration
For Single Entry: When Single Entry is selected, you'll see a Date field where you can specify exactly when the transaction should be effective.
For Recurring Entry: When you select Recurring Entry, additional configuration options appear:
Automated Creation Question You'll see the question: "Would you like transactions to be automatically created in the accounting software on the scheduled dates based on your configuration?"
Yes (recommended): GATHER.nexus will automatically create and post transactions according to your schedule
No: Transactions will be prepared but require manual approval before posting
(This Yes/No selection appears as radio buttons, with "Yes" being the recommended option for streamlined processing.)
Transaction Frequency Settings
When Recurring Entry is selected, you'll configure the frequency details:
Frequency Options:
Monthly: Creates 12 transactions per year (one for each month)
Quarterly: Creates 4 transactions per year (one for each quarter)
Semi-annually: Creates 2 transactions per year (every 6 months)
Annually: Creates 1 transaction per year
Start Date Enter the date when your recurring recharges should begin (e.g., "01-02-2025")
End Date Specify when the recurring recharges should stop (e.g., "12-31-2025")
Never Expire Option Select "Never Expire" if you want the recharges to continue indefinitely until manually stopped
(The frequency settings show Monthly as the default selection, with date fields for Start Date and End Date, plus a Never Expire checkbox option.)
How Frequency Works in Practice:
Monthly: If you set January 1st to December 31st, you'll get 12 separate transactions (Jan, Feb, Mar, etc.)
Quarterly: Same date range creates 4 transactions (Q1: Jan-Mar, Q2: Apr-Jun, Q3: Jul-Sep, Q4: Oct-Dec)
Annually: Creates just 1 transaction per year on your specified date
Semi-annually: Creates 2 transactions (typically January and July)
Transaction Status
Configure how your transactions will be handled in your accounting system:
Draft Select Draft if you want to review transactions before they're finalised:
Transactions are created in your accounting system but not yet posted
Allows for review and approval before affecting your financial records
Posted Choose Posted (also called "Published" in Xero) to automatically finalise transactions:
Transactions are immediately posted to your accounting system
Affects your financial records and balances immediately
Suitable for routine, pre-approved recharges
(The Draft option is selected by default, allowing for review before finalisation.)
Understanding Draft vs Posted in Xero Integration:
When working with Xero accounting software:
Draft: Creates journal entries in Xero that appear in your draft journals list but don't affect your trial balance or reports until you manually publish them
Posted/Published: Journal entries are automatically published in Xero and immediately affect your financial position and reports
💡Tip: For new intercompany recharge processes, start with "Draft" status to review the entries before they affect your financial records. Once you're confident in the setup, you can switch to "Posted" for streamlined processing.
Once you've configured all transaction settings, click Save & Next to proceed to the final configuration step, or Previous to return to company selection.
FOR SIMPLE:
Step 4: Configure & Save
You've now reached the final configuration step where you'll set up the actual accounting entries and complete your intercompany recharge workflow. The sidebar shows all previous steps completed with green checkmarks, and step 4 is now highlighted.
Recharge Configuration Methods
At the top of the Configure & Save screen, you'll see three configuration options:
Simple (Currently Selected): The Simple method is highlighted in green and is ideal for straightforward recharges between companies. This method is perfect for:
Two-company recharges
Direct cost allocations
Fixed amount transfers
Basic intercompany transactions
Split by Percentage: Available for more complex allocations where costs need to be divided among multiple companies based on predetermined percentages.
Split by Percentage with Markup: Used when you need to add a profit margin or markup to the recharged costs
Journal Entry Configuration
The system displays your recharge setup with key details:
Journal entry for month of: Jan
Year: 2025
Filter by: from Company 1 to All Company
Understanding the Filter Feature: The "Filter by: from Company 1 to All Company" is particularly useful when you're managing recharges between many companies. This feature allows you to focus on specific company relationships, making it easier to configure and review transactions in complex multi-entity structures.
Month and Year Selection
You can modify the timing of your recharge using the dropdown selectors:
Month Selection Click on the month dropdown to see available options:
(A dropdown menu appears showing all available months for your recharge period.)
Year Selection The year selector shows "2025" and can be modified by clicking the dropdown to select from available years.
(The year dropdown allows you to select different years for your recharge configuration.)
Company Filter Selection
The filter dropdown shows "All Company" with additional options:
All Company: Includes all companies in your recharge workflow
Demo US: Filters to show only Demo US related transactions
Demo US 2: Filters to show only Demo US 2 related transactions
(The company filter dropdown helps you focus on specific company relationships when managing complex multi-entity recharges.)
Account Mapping Configuration
The screen shows two main Chart of Accounts sections for your participating companies:
Left Side - Demo UK (Currency: GBP) Narration: "Recharge to Subco US"
Credit Entry:
250 - Intercompany Recharge Revenue (This account records the revenue for the company providing the service)
Debit Entry:
1201 - Intercompany Receivable - OpCo (This account records the amount owed by the receiving company)
Right Side - Demo US (Currency: USD) Narration: "Recharge from Holdco"
Transaction Currency: USD
Debit Entry:
6000 - IT Expense (This account records the expense being allocated to the receiving company)
Credit Entry:
2060 - Intercompany Payable - HoldCo (This account records the amount owed to the providing company)
Understanding the Double-Entry Flow
The dotted arrows between accounts show the balanced nature of intercompany transactions:
The Credit in Demo UK (250 - Intercompany Recharge Revenue) connects to the Debit in Demo US (6000 - IT Expense)
The Debit in Demo UK (1201 - Intercompany Receivable - OpCo) connects to the Credit in Demo US (2060 - Intercompany Payable - HoldCo)
This ensures proper double-entry bookkeeping across both companies, maintaining accurate financial records and facilitating consolidation.
Multi-Currency Handling
Notice that the system automatically handles currency differences:
Demo UK operates in GBP (Great British Pounds)
Demo US operates in USD (US Dollars)
The transaction currency is specified as USD for the US entity
GATHER.nexus manages the currency conversion automatically, ensuring accurate reporting in each company's base currency.
Note: Xero doesn’t allow you to create a multi currency Journal entry so Conversion rates will be calculated by the GATHER platform at the date of the transactions. You can review in detailed screen which exchange rate is applied.
Tracking Category Configuration
Each company section includes a Tracking Category feature:
Purpose: Enable this feature to assign tracking categories to your intercompany transactions Benefits:
Allows for departmental or project-based tracking
Facilitates detailed reporting and analysis
Helps with cost centre allocation
Supports management reporting requirements
Enabling Tracking Categories: Click the Enable button under each company's Tracking Category section to activate this feature. The system will then allow you to assign specific tracking codes to your intercompany transactions.
(Each company has an Enable button for tracking categories, allowing you to add departmental or project tracking to your intercompany recharges.)
Additional Company Configurations
At the bottom of the screen, you'll see additional Chart of Accounts sections for other participating companies:
Demo UK (Currency: GBP) - Additional configuration options
Demo US 2 (Currency: USD) - Additional configuration options
These sections allow you to configure account mappings for all companies involved in your intercompany recharge, ensuring comprehensive transaction recording across your entire group structure.
Completing Your Configuration
Once you've reviewed and configured all account mappings:
Verify Account Selections: Ensure all debit and credit accounts are appropriate for your business
Check Currency Settings: Confirm transaction currencies are correctly specified
Enable Tracking: Activate tracking categories if needed for your reporting
Review Narrations: Ensure transaction descriptions are clear and meaningful
Click Save & Next to proceed to the amount setup phase, Previous to return to transaction configuration, or Cancel to exit without saving.
FOR SPLIT BY PERCENTAGE:
Step 4: Configure & Save
When using Split by Percentage, you gain precise control over cost distribution.
Set Up Percentage Allocation: Click on Split by Percentage to open the allocation interface where you can:
View the percentage remaining out of 100%
Allocate specific percentages to each entity
Use either sliders or direct percentage input
Example Percentage Setup:
Demo UK: 60% (enter "60" or use the slider)
Demo US: 40% (enter "40" or use the slider)
The system provides visual feedback showing "You have 0% remaining out of 100%" once your allocations are complete.
Complete the Percentage Allocation:
Verify your percentages add up to 100%
Click Save to confirm your percentage split
The system returns to the main configuration screen with allocations applied
Journal Entry Setup with Percentage Split: After setting percentages, configure the journal entries:
Demo UK (Currency: GBP):
Narration: "Recharge to SubCo"
Credit: 201 - Intercompany Recharge Revenue (60% allocation)
Debit: 265 - Intercompany Receivable - OpCo (60% allocation)
Demo US (Currency: USD):
Narration: "Recharge from HoldCo"
Transaction Currency: USD
Credit: 325 - IT Expense (60% allocation)
Debit: 1320 - Intercompany Payable - HoldCo (60% allocation)
Configure tracking categories (optional)
For both Simple and Split by Percentage methods, you can enable tracking categories:
Review the Tracking Category section for each entity
Click Enable if you want to assign tracking categories to these transactions
This feature helps with departmental reporting or project-based cost allocation
Enable sample data for reviewing
Toggle the Sample Data switch to preview your configuration before processing live transactions. This allows you to verify that all journal entries, allocations, and account mappings are correct.
Period wise Configuration
You can set up configurations based on specific periods. For example, if you are working on a monthly basis, January can have one configuration, while February can have a different one.
Review and finalise your configuration
Before completing the setup:
Verify all narrations are clear and will be meaningful for your audit trail
Check account mappings ensure costs are hitting the correct expense accounts
Confirm currency settings are appropriate for each entity
Review percentage allocations (if using Split by Percentage)
Test with sample data to preview the journal entries before going live
Save your configuration
At the bottom of the screen, you have three options:
Save: Saves your current configuration
Update & Next: Saves your configuration and proceeds to the next step
Previous: Returns to the previous step if you need to make changes
Cancel: Discards your current configuration
Select Update & Next to save your intercompany recharge configuration and move forward with processing.
FOR SPLIT BY PERCENTAGE WITH MARKUP:
Step 4: Configure & Save
When using Split by Percentage with Markup, you gain both percentage control and the ability to apply different markup rates to each entity.
Set Up Percentage and Markup Allocation: Click on Split by Percentage with Markup to open the advanced allocation interface where you can:
Configure base percentage allocations for each entity
Apply individual markup percentages to each entity
Choose between uniform or different markup rates
Markup Configuration Options: The system provides flexible markup settings:
Add Markup Percentage toggle: Enable this to activate markup calculations
Mark as Same for all: Applies uniform markup percentage across all entities
Mark as Different for all: Allows individual markup rates per entity
Example Markup Setup with Different Rates: When Mark as Different for all is selected:
Demo UK:
Base allocation percentage (via slider or input)
Markup percentage: 5% (enter "5" in the markup field)
Demo US:
Base allocation percentage (via slider or input)
Markup percentage: 8% (enter "8" in the markup field)
Demo US 2:
Base allocation percentage (via slider or input)
Individual markup percentage (customizable per entity)
Complete the Markup Allocation:
Set your base percentage allocations.
Configure individual markup rates for each entity
Review the calculated final amounts including markup
Click Save to confirm your percentage and markup configuration
The system returns to the main screen with all calculations applied
Journal Entry Setup with Markup Applied: After configuring markup percentages, the journal entries reflect the marked-up amounts:
Demo UK (Currency: GBP):
Narration: "Recharge to SubCo"
Credit: 201 - Intercompany Recharge Revenue (calculated with 5% markup)
Debit: 265 - Intercompany Receivable - OpCo (calculated with 5% markup)
Applied amounts: Shows the final calculated values (e.g., "43.2" reflecting base allocation plus markup)
Demo US (Currency: USD):
Narration: "Recharge from HoldCo"
Transaction Currency: USD
Credit: 325 - IT Expense (calculated with 8% markup)
Debit: 1320 - Intercompany Payable - HoldCo (calculated with 8% markup)
Applied amounts: Shows the final calculated values reflecting base allocation plus markup
💡Tip: The markup feature is particularly useful for management fee allocations where different entities may have different service level agreements or where transfer pricing regulations require specific markup rates between entities.
Configure tracking categories (optional)
For all three allocation methods (Simple, Split by Percentage, and Split by Percentage with Markup), you can enable tracking categories:
Review the Tracking Category section for each entity
Click Enable if you want to assign tracking categories to these transactions
This feature helps with departmental reporting or project-based cost allocation
Enable sample data for testing
Toggle the Sample Data switch to preview your configuration before processing live transactions. This allows you to verify that all journal entries, allocations, and account mappings are correct.
Review and finalise your configuration
Before completing the setup:
Verify all narrations are clear and will be meaningful for your audit trail
Check account mappings ensure costs are hitting the correct expense accounts
Confirm currency settings are appropriate for each entity
Review percentage allocations to ensure they add up to 100%
Validate markup calculations (if using Split by Percentage with Markup) to ensure compliance with transfer pricing requirements
Test with sample data to preview the journal entries before going live
Save your configuration
At the bottom of the screen, you have three options:
Save: Saves your current configuration
Update & Next: Saves your configuration and proceeds to the next step
Previous: Returns to the previous step if you need to make changes
Cancel: Discards your current configuration
Select Update & Next to save your intercompany recharge configuration and move forward with processing.
Step 5: Setting up amounts
After completing your configuration, you'll be redirected to the main detailed screen showing transactions that need to be created based on your configuration.
Amount setup options
Click Setup Amount to access two configuration methods:
Enter Manually
Same Amount for all months:
Select this option for consistent monthly allocations
Enter a single amount that will apply to every period
Ideal for fixed costs like rent, insurance, or management fees
Example: £5,000 monthly management fee applied consistently
Different Amount for Each Month:
Choose this for variable monthly allocations
Enter specific amounts for each period individually
Perfect for actual cost recharges that vary month to month
Example: January £3,000, February £4,500, March £2,800
Pick From Ledger Code
Based on your configuration, the system will display available ledger codes and pick amounts from the From Company's connected Xero account.
Same Amount for all months:
Select a specific ledger account from your Xero chart of accounts
The system pulls the account balance for the first period selected and applies the same amount consistently
Different Amount for Each Month:
Select the ledger account for variable allocations
System pulls actual monthly amounts from the selected account
Automatically adjusts recharges based on actual spending
Perfect for true cost pass-through allocations
Amount configuration process
Review transaction summary: The detailed screen shows all planned transactions
Select amount method: Choose manual entry or ledger-based amounts
Configure periods: Set amounts for each relevant period
Verify calculations: Review percentage splits and markups if applicable
Test with sample data: Use the preview function to verify accuracy
💡Tip: When using "Pick From Ledger Code," ensure the selected account contains the exact costs you want to allocate. The system will pull the full account balance for the specified period.
Step 6: Post transactions
Once amounts are configured, you can review and process your intercompany transactions.
Transaction review and processing
Review transaction details:
The system displays all transactions with calculated amounts
Review each transaction for accuracy and completeness
Verify currency conversions and account mappings
Check that percentage allocations and markups are correctly applied
Processing options:
Bulk Post:
Select multiple transactions using checkboxes
Click Bulk Post to process all selected transactions simultaneously
Ideal for processing monthly allocations across multiple entities
Saves time when handling large volumes of similar transactions
Individual Post:
Process transactions one by one for careful review
Click the Post button next to each specific transaction
Recommended for complex or high-value transactions
Allows for transaction-by-transaction verification
Automatic posting for future transactions
Automated processing:
Future transactions will post automatically based on your configuration
Recurring entries follow your specified frequency and timing
No manual intervention required for routine ongoing allocations
System maintains consistency across all automated postings
Transaction management features
Repost Transactions:
Use the Repost function if you need to correct or update posted transactions
Helpful for adjusting amounts or correcting account mappings
Maintains audit trail of all changes and corrections
Ensures accounting accuracy across all affected entities
View in Xero Integration:
Click the View button next to any transaction
System redirects you directly to the specific transaction in Xero
Review the actual journal entry or invoice as it appears in your accounting system
Verify proper posting and account classification
Transaction status tracking
Draft Status:
Transactions created but not yet affecting financial records
Allows for final review
Posted Status:
Transactions are live in your accounting system
Affecting trial balances and financial reports
Audit trail maintained for all posted transactions
Confirming your success
Your Intercompany Recharge setup is working correctly when:
Configuration level:
All companies are properly selected and connected
Account mappings are accurate and balanced
Currency conversions are correctly applied
Transaction level:
Amounts post correctly to all participating entities
Double-entry bookkeeping is maintained across companies
Xero integration shows proper journal entries
Tracking categories are applied when configured
Ongoing operations:
Recurring transactions post automatically as scheduled
Manual transactions process without errors
Reposting functions work correctly when needed
Integration with Xero remains stable and accurate
Common questions
Q: My currencies don't match between companies - how does this work?
A: GATHER.nexus automatically handles multi-currency transactions. The platform applies appropriate exchange rates and ensures each entity records transactions in their base currency.
Q: Can I modify a posted transaction?
A: Yes, use the Repost function to correct posted transactions. This maintains a complete audit trail while allowing for necessary adjustments.
Q: What happens if my Xero connection fails during posting?
A: You can manually repost individual transactions after re-connecting the company.
Q: How do I handle different markup rates for different entities?
A: Use the "Split by Percentage with Markup" method and select "Mark as Different for all" to apply individual markup rates to each participating entity.
Q: Can I see the actual exchange rates used for multi-currency transactions?
A: Yes, the detailed screen shows all exchange rates applied by the GATHER platform for each transaction.
What's next?
Once you've mastered the Intercompany Recharge Tool:
Explore Advanced Allocations: Learn complex percentage and markup strategies
Integration with Consolidation: Optimise your Recharge process to ensure intercompany elimination works smoothly for the consolidation process
Have questions or need assistance❓
Contact our support team at support@gather.nexus