> For the complete documentation index, see [llms.txt](https://smartbooks.gitbook.io/smartbooks-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://smartbooks.gitbook.io/smartbooks-docs/faq/i-see-an-ic-difference-profit-and-loss-and-ic-difference-balance-sheet-in-my-reports.-what-does-this.md).

# I see an IC Difference Profit & Loss and IC Difference Balance Sheet in my reports. What does this m

The **IC Difference** lines show the remaining difference when **intercompany transactions within a consolidation do not fully eliminate against each other**.

In Smartbooks, intercompany transactions booked to accounts that are marked for **elimination** are automatically matched and eliminated.\
If, within a (sub)consolidation, these transactions **do not sum to zero**, the remaining amount is shown as:

* **IC Difference Profit & Loss**
* **IC Difference Balance Sheet**

### What does this mean in practice?

An IC Difference indicates that there is a **mismatch between intercompany transactions across entities**. This can have several causes, including:

* A missing counterparty booking
* A transaction booked to an account that is not marked for elimination
* A timing difference between entities
* A partially matched transaction

The IC Difference makes these discrepancies visible so they can be investigated and resolved.

### Is this an error?

Not necessarily.

* **Temporary differences**, such as timing differences, can be expected
* **Structural differences** usually indicate an issue that should be corrected

Smartbooks intentionally shows IC Differences to provide transparency in consolidated reporting.

### How can I investigate this?

You can:

1. Right-click on the amount in the **IC Difference** line
2. Select **Show intercompany transactions**
3. Review the underlying transactions and drill down to the source journal entries. For a detailed overivew of this functionality please visit the [Intercompany Reconciliation](/smartbooks-docs/advanced-features/intercompany-reconciliation.md) page. 

<figure><img src="https://1846213233-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FswBFWX9ni1arN3lAqgKQ%2Fuploads%2FTujqnTLoU7e014jhfJKv%2Fimage.png?alt=media&amp;token=b0e0a042-56de-433a-8203-67d27d2740e7" alt=""><figcaption></figcaption></figure>

### Why is this important?

IC Differences help you:

* Maintain reliable consolidated financial statements
* Identify intercompany mismatches early
* Ensure eliminations are complete and accurate