Field Notes
Reading reserved-capacity credits on a Taiwanese subsidiary ledger
3 February 2026
Reserved-capacity credits rarely match the month of the related usage. Vendors issue them when commitments renew, when coverage drops, or when a promotional adjustment clears. Controllers who expect a clean monthly offset will misstate both expense and prepaid balances.
Map each credit to its commitment identifier, not just to the invoice date. If the credit relates to a prior period, post it against that period’s accrual rather than current-month expense. Your auditor—or your own quarterly review—will ask for that trail.
When the parent company buys the commitment and the Taiwan subsidiary consumes the capacity, record the intercompany recharge separately from the vendor credit. Mixing the two is a common source of double counting.
Keep a simple register: commitment ID, credit amount, invoice number, ledger period, and owner. Update it when credits arrive, not at quarter-end. That habit turns a messy close item into a routine control.