A sister company remittance should be matched to the actual customer debt before a receivable is cleared. A payment from a related business can settle a customer’s invoice, concern another transaction or have been sent in error. Preserve the bank credit and ask for a clear allocation instruction.

Accounting records, calculator and glasses on a desk
Illustrative photograph by Cht Gsml.

Separate the parties

Identify your company, the invoiced customer, the bank payer and the person sending the remittance advice. Similar group names do not mean those entities are interchangeable.

Keep the invoice numbers, amounts and currency alongside the payment reference. Confirm any allocation through a verified contact route, especially if the instruction differs from the usual arrangement.

Obtain the basis for clearing the debt

Ask for written confirmation of which invoices the payer intends to settle and the customer’s acknowledgement where appropriate. Refer unclear third-party payments to the finance reviewer.

Do not change the customer named on the sales invoice simply to match the incoming bank description. Any separate contractual or invoicing correction needs its own review.

Example: one group payment covers several invoices

The payer provides a total but only one customer name. Request a schedule identifying the legal customer and invoice for each allocation. Keep the unallocated portion visible rather than spreading it across outstanding balances merely to make the bank reconciliation balance.

Retain the reconciliation trail

Link the accepted allocation, bank receipt and ledger postings. Ask the accountant to assess any intercompany, foreign-currency or tax implications on the actual facts. A related payer’s receipt does not by itself prove that all group balances, credit notes or disputed invoices have been settled.

Related practical guidance

For the surrounding records and responsibilities, see bookkeeping basics, company records to keep, bookkeeping and accounting.

Official guidance: IRAS official guidance.

Help with your company records

For accounting, bookkeeping and related compliance support, contact Raffles Corporate Services at [email protected] or WhatsApp +65 8501 7133. Tell us which records or process need attention so we can discuss the relevant next steps.