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Intercompany Journal Mirroring

The Problem

When a user posts a manual journal in one Xero entity (e.g. to record an intercompany loan, recharge, or allocation), they must manually replicate the corresponding entry in the linked entity. This is time-consuming, error-prone, and breaks the audit trail across the group.

The Proposed Solution

Extend the existing Xero Network connectivity to support automated intercompany journal drafting i.e. when a manual journal is posted in Entity A, Xero drafts the mirror journal in the linked Entity B, ready for review and approval.

Key Features to Consider

• Linked entity mapping — Users define which accounts in Entity A correspond to which accounts in Entity B (e.g. Intercompany Payable ↔ Intercompany Receivable).
• Draft, not auto-post: The mirrored journal lands as a draft in the receiving entity, preserving human oversight and approval workflows before anything hits the ledger.
• Narrative carry-over: The journal description, reference, and date auto-populate in the mirror to maintain a consistent audit trail.
• Two-way awareness: If the draft mirror journal is edited or rejected in Entity B, Entity A should receive a notification to prevent unreconciled discrepancies.

Why It Works Within the Xero Framework

This is a natural extension of Xero Network, which already handles intercompany invoicing between connected organisations. Journals are simply the next logical layer, particularly valuable for:

• Management fee recharges
• Intercompany loans and interest
• Group cost allocations
• Consolidation adjustments