Barter exchanges facilitate barter transactions among businesses, and assist in tracking the revenues and expenses that must be recognized for tax reporting purposes. The variation of Internal Revenue Service form 1099 issued by barter exchanges is the 1099-B.
In particular, barter exchanges provide the accounting for complex multi-party arrangements where businesses engage in "round robin" barter transactions, rather than traditional bilateral or direct one-on-one swaps of goods and services.
An example of a "round robin" barter transaction is one in which business A supplies something to business B, business B supplies something else to business C, and business C supplies yet another product or service to business A to complete the transaction. In this sense, barter exchanges are acting as the managers of an alternative currency.
