Introduction

The conventional close process is rarely straightforward; it involves juggling data from various sources and formats, painstakingly chasing down missing pieces, and manually inputting spreadsheet calculations into the accounting system. For organisations operating across multiple subsidiaries or business units, this task becomes even more daunting, particularly if they span different countries.

The Multi-Subsidiary Accounting Challenge

Things get interesting when companies expand and acquire new businesses to broaden their revenue streams. This expansion typically leads to the adoption of many siloed-ERP/legacy systems and accounting systems concurrently. Although each system may serve its purpose individually, they rarely integrate seamlessly, making data consolidation and normalisation across the organisation exceedingly challenging.

Lack of a standardised chart of accounts presents another hurdle in producing consolidated financial report(s). Each transaction from every subsidiary must be meticulously scrutinised by the accounting team before posting to ensure accurate account codes are utilised. However, due to resource constraints and time pressures, this meticulous review might not always occur, especially for smaller dollar value transactions.

Achieving Harmony Through Technology

If you are operating in many countries that have diverse government regulations and tax compliance requirements, managing different accounting standards, tax regulations, and exchange rates poses a different challenge entirely. While subsidiaries must adhere to local regulations, aligning with corporate accounting standards and utilising a unified chart of accounts helps with the consistency and facilitates consolidation. CFOs and Financial Controllers often get bogged down with manually reviewing and adjusting transaction data from subsidiaries, reconcile revenue and depreciation calculations. This prolongs the close process and heightens the risk of errors. Not to mention frustration and lowering of morale of the finance and accounting staff this brings as a result. Therefore, transitioning from separate ERP and accounting systems to a unified solution becomes crucial for growing businesses.

Typically, a Multi-entity and/or Multi-subsidiary accounting software tailored to address these complexities should include:

• A shared general ledger with a standardised chart of accounts and the flexibility to customise accounts at different levels (region, country, subsidiary).
• Automated currency conversion based on current exchange rates with simultaneous posting in both local and parent company currencies.
• Support for multiple accounting standards and tax regulations, allowing for varied treatments of transactions.
• Seamless consolidation without manual reclassification or adjustment of transactions
  Real-time access to subsidiary financial data for authorised users, down to transaction level.

NetSuite’s Multi-Book Accounting: A Game-Changer

NetSuite’s multi-book accounting software allows finance professionals to create and manage multiple sets of books to manage each entity and/or subsidiary in compliance with the relevant country’s financial, tax, and managerial requirements and applicable standards.
Organisations can create book-specific GL accounts and fixed asset depreciation schedules, accommodating variations in corporate taxes or depreciation across different regions.

NetSuite’s multi-book accounting automates currency conversion based on a predefined set of rules, to post transactions in multiple currencies simultaneously using real-time exchange rates. This makes it much easier for businesses to close the books quickly and be able to see real-time GL impacts across multiple currencies.

The Benefits of Streamlined Accounting

In summary, NetSuite’s multi-book capabilities benefit growing businesses with complex manufacturing operations and/or multiple subsidiaries by streamlining the close process through real-time consolidation, automatic currency conversion, and adherence to diverse accounting standards and tax regulations.

The outcome is timely, accurate reporting, reduced strain on accounting personnel, and enhanced stakeholder relations.

Partnering for Success

Transforming Your Global Finance Function: Expertise and Proven Results

Absolute Vision technology (AVT) is a leading Oracle partner based in Australia that specialises in NetSuite ERP deployment and implementation within Manufacturing & Wholesale Distribution industries. We’ve been in the business since 2006 and have established a strong and visible footprint across the Australian industrial sector.

NetSuite is a cloud-based accounting package with over 34,000 customers, offering process automations, workflow management, dashboards, and reporting. The software delivers CRM, Order Management, Inventory Management, WMS, HCM, Payroll, Accounting, Banking, Fixed Assets, Revenue Recognition, Multi-Entity, Multi-Currency, Consolidation, and reporting under one system. To find out more about NetSuite, please visit www.abvt.com.au/netsuite. AVT has been helping over 200+ companies across AU, NZ, UK, and USA migrate to a better and scalable state of operations with NetSuite. Please visit https://www.abvt.com.au/oracle-netsuite-evaluation-discovery and get started on your company Digital Transformation.

New to NetSuite?

To learn more, AVT – Australia’s Leading NetSuite Solution Provider & Partner has created a complimentary NetSuite ERP Evaluation micro-site to help executives learn more about ERP and its deployment, using pre-recorded process demo videos, White papers and data sheets, so you may evaluate this at your own pace. You can gain access to to the site by completing your Registration in the link: NetSuite Overview Demos.