CAT / FIA FFA Syllabus G. Preparing Simple Consolidated Financial Statements - Intra Group Balances - Notes ^{9 / 11}

If the companies within the same group trade with each other, then this will probably lead to:

• A receivables account in one company’s SFP

• A payables account in the other company’s SFP.

These are amounts owing within the group rather than outside the group and therefore they must not appear in the consolidated statement of financial position.  They are therefore cancelled against each other on consolidation.