Cross company code transactions are unique transactions, which are handled a little differently by SAP FICO. To understand the concept of cross company code transactions in SAP FICO, lets start with the basics. A Cross Company Code transaction involves two or more company codes in a single transaction in SAP R3 FICO. This means that a cross company code transaction posts to accounts in two company codes. You can read my post on the basics of company codes here.

The way SAP FICO works is that it posts a accounting document in each company code rather than one single posting document. This is beacuse in SAP FICO, one accounting document is always assigned to one company code. A question naturally comes to mind as to how do the debits and credits match i.e. how do accounts balance. To balance accounts, SAP FICO automatically generates line item entries which are posted to a clearing account. Such clearing accounts are normally payables or receivable accounts within company codes. SAP FICO tags cross company code transactions with a common cross company code transaction number for reference. Some examples of cross company code transactions are:

1. Goods are sold by one company code to the another company code.
2. Goods are purchased by one company code from the other company code.
3. One company code makes a payment on behalf of another company code.

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