Items for Revenue and Expense
Items in NetSuite have default general ledger accounts and classification info (Department and Class) for sales and purchase transactions. Most items you’ll need for NFP Financials are just for financial info, not for inventory. For general information about items in NetSuite, see Using Item Records.
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Revenue and expense accounts – Depending on the item type (for sale, purchase, or resale), you’ll need an income account, expense account, or both. You’ll set these accounts on the Accounting subtab of the item record. You can also pick deferred revenue and deferred expense accounts on the Accounting subtab.
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Tax schedule – Tax schedules are required if the Advanced Taxes feature’s enabled. The tax schedule on an item decides how NetSuite calculates taxes for each tax nexus. You can set up non-taxable schedules for donation items that aren’t subject to tax.
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Billing schedule – If the full revenue is not booked at the time of the award or contract, you can link a billing schedule to the item on the Sales/Pricing subtab. Examples of items with billing schedules include service fees, exchange agreements, or pledges that are not a promise to pay.
For information about billing schedules, see Advanced Billing Overview.
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Amortization template – You can link a predefined amortization template to an item for purchase or resale on the Revenue Recognition/Amortization subtab. Amortization templates show how expenses are recognized over future periods. If you set an amortization template, you’ll also need to pick a deferred expense account on the Accounting subtab.
For more information about deferred expenses and amortization, see Expense Amortization.
Non-inventory or service items for sale or resale count as revenue on sales transactions. In NetSuite, non-inventory and service are item types, and for resale and for sale are subtypes.
Non-inventory or service items for purchase or resale count as expenses on purchase or payables transactions. You’ll need expense items for any expenses with quantities and receipts. For other expenses, you can set the general ledger account right in the transaction.
The Can Be Fulfilled/Received box on the item Preferences subtab is checked by default for non-inventory items and other charges. Be sure to clear the box unless the item requires fulfillment or receipt. After you use the item in a transaction, this preference on the item record cannot be changed.
To create items, go to Lists > Accounting > Items > New and click the link for the type of item you want to create. For more information, see Creating Item Records.
You can also import items using CSV files. For more information, see CSV Imports Overview and Items Import
Best Practices for Items Used for Nonprofits
The following are some best practices for nonprofit items:
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Create at least one revenue item for each income account you’ll use for revenue transactions in your chart of accounts. The non-inventory for sale item type works best for these. For example, create items for contributions, membership dues, grant income, pledges, and other income sources as needed.
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If you use billing and amortization schedules, create items so you don’t have to override the defaults when adding them to transactions.
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Leave the NetSuite segmentation fields (Department and Class) blank. You can set these values directly on the transactions.
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For expenses, create item records for things you buy for internal use or occasional resale.
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Use parent-child item hierarchy to set up logical relationships between items for easier reporting.
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Talk to your accountant before setting up tax schedules. Tax rules on items can vary a lot by state, exemption status, and item type.