Making Advanced Intercompany Journal Entries

Using an advanced intercompany journal entry, you can specify the originating subsidiary and multiple receiving subsidiaries for the journal entry. You can also change the transaction currency to any currency set up in your system. Other behavior of advanced intercompany journal entries is similar to regular intercompany journal entries. For information about regular intercompany journals, see Making Intercompany Journal Entries.

Scripts and workflows for regular intercompany journal entries do not work with advanced intercompany journal entries. You must create separate scripts and workflows for advanced intercompany journal entries.

To create advanced intercompany journal entries, your role must include at least edit-level access for the Make Journal Entry permission. Advanced intercompany journal entries respect subsidiary and account restrictions.

If you use the Automated Intercompany Management feature, advanced intercompany journal entries include an Auto Balance button. This button automatically adds elimination lines to balance the transaction. For example, if the net amount of a To subsidiary is a credit, an offsetting debit line with a receivables account is automatically added.

You cannot use a default intercompany journal entry auto balance account if that account has a currency or subsidiary restriction that makes the line invalid. For example, if the default auto balance account currency is restricted to the Japanese Yen, you cannot use it with a journal in which the currency is set to CAD.

Important:

When the Intercompany Time and Expenses feature was released, accounts were created named Intercompany Payable/Receivable XXX, where XXX denoted the currency ISO code. In 2013.1, the Intercompany Clearing XXX account was introduced. This account replaced the Intercompany Payable/Receivable Account for new NetSuite implementations. Existing implementations kept the original accounts. In 2014.1, intercompany clearing accounts were introduced for payable and receivable that were not currency locked. These clearing accounts are used for intercompany transactions. All existing currency-locked intercompany clearing accounts (the Intercompany Payable/Receivable accounts) are now child accounts of the clearing account. For more information, see Intercompany Elimination Overview.

The following topics include information related to journal entries and advanced journal entries:

Journal Entries in OneWorld – general information about journal entries in OneWorld
Example of Intercompany Journal Entries – an example of an intercompany journal entry
Creating Intercompany Allocation Schedules – information about automatically creating journal entries from allocation schedules
Advanced Intercompany Journal Entry Import – information about importing advanced intercompany journal entries

To make an advanced intercompany journal entry:

Go to Transactions > Financial > Make Advanced Intercompany Journal Entries.
In the Classification section, select the Subsidiary initiating the journal entry.
1. You must select the Subsidiary before you can select the Currency.
  
  The first line of this journal entry must post to the Subsidiary you select.
  
  Note:
  If the subsidiary you select is assigned to vendor or customer records, you can make journal entries for any of these vendors or customers. To do this, on the Lines subtab, select the vendor or customer from the Name field. For more information about shared records, see Assigning Subsidiaries to a Vendor and Assigning Subsidiaries to a Customer.
In the Primary Information section:
1. In the Entry No. field, accept the default or enter a different number.
  
  If journal entries are assigned auto-generated numbers in your account, you cannot change the default number unless the override permission is enabled for Journal. For more information, see Set Auto-Generated Numbers.
2. Review the Out of Balance By fields as you enter journal lines. They indicate whether the debits and credits in the journal entry balance.
3. By default, the Currency field displays the base currency of the subsidiary selected in the Subsidiary field.
  
  You can change this value to any currency set up in your system.
  
  If one of the subsidiaries uses a base currency different from the selected currency, the Line subtab also displays the transaction amount translated into the subsidiary’s base currency. This translation is based on the exchange rate entered on the intercompany journal line.
4. If you have journal approval permission, check the Approved box to approve your journal entry when you save it.
  
  If the Approved box is displayed and you do not check it, the journal entry does not post until it is approved.
  
  The Approved box displays only if the Require Approvals on Journal Entries accounting preference is checked. For information, see Require Approvals on Journal Entries Preference.
  
  When you check the Journal Entries box on the Approval Routing subtab on the Accounting Preferences page, the Approved box is not added to the journal entry page. Approval routing for journal entries uses SuiteFlow to create journal entry approval routing. For information, see Use Journal Entry Approval Routing.
5. In the Date field, accept today's date or enter a new date for the journal entry.
6. If you use fiscal periods, you see a Posting Period field.
  
  The posting period is determined when the journal entry is approved. When you approve a journal entry, you can select a different value than the one initially displayed. You cannot select a closed period. You may be able to select an open and locked period if your role includes the Override Period Restrictions permission.
7. Leave the Reversal Date field blank and Defer Entry box blank, unless you want to create a reversing entry at the same time.
  
  If you check the Defer Entry box, the Reversal Date field is mandatory.
  
  For information about reversing entries, see Reversing Journal Entries.
8. In the Memo field, enter information to help you identify this journal entry in a list of other journal entries.
  
  The value in this field displays on the List page.
On the Lines subtab, enter the information for the journal lines.

The columns that appear are based upon the permissions set for your user role.

Tip:
You can navigate down the lines by pressing the Enter key on your keyboard. Use your mouse to navigate up the lines.
1. In the Subsidiary field, select the subsidiary to associate with this journal line.
  
  The first line must be the same as the subsidiary selected in the Subsidiary field in the Classification section of the journal entry. Lines after the first may be any of the other subsidiaries.
  
  The subsidiaries that appear in the list are based upon the permissions set for your user role. You must have access to all the subsidiaries on the record.
2. In the Account field, select the general ledger account for posting this journal line.
  
  The list of available accounts is filtered according to any class, department, location, and subsidiary restrictions set for your role. Accounts that are associated with classes, departments, locations, or subsidiaries to which your role does not have access are not available in the Account list.
  
  If you use the Automated Intercompany Management feature, you can select an intercompany account. The Eliminate box is checked to flag the line for elimination at period end. See Elimination Through the Automated Intercompany Management Feature.
  
  If you enabled the Intercompany Time and Expense feature, you can use the subsidiaries' intercompany clearing account for entries that transfer charges for time or expenses. See Intercompany Clearing Account.
3. In the Debit or Credit field as appropriate, enter the amount to post to the account.
4. If required, select a Tax Code to determine the tax rate for the line.
5. Optionally, enter a Memo to help you recognize this entry in a register for this account.
6. Optionally, in the Name field, select a customer, employee, project, or vendor to associate with this entry.
  
  NetSuite filters the list of options in this field and includes only entities that support the selected base currency. If the subsidiary you selected is assigned to one or more shared vendor or customer records, you can make this journal entry for any of the vendors or customers to which the selected subsidiary is assigned. To do this, select the shared vendor or customer in this field. or more information about shared records, see Assigning Subsidiaries to a Vendor and Assigning Subsidiaries to a Customer.
  
  If you use the Customers and Multiple Currencies feature, you can create a journal entry for an entity in any of that entity’s currencies.
  
  If you use Automated Intercompany Management, select an intercompany customer or intercompany vendor, as appropriate.
7. This step only applies if you have enabled Departments, Classes, or both, and you classify at the line-level rather than the transaction-level. Select the appropriate classification to associate with this line-entry. To read more about line-level classifications, see Class, Department, Location Journal Entry Preferences.
  
  For information about Departments and Classes, see Departments and Classes Overview.
8. If you have enabled Locations on the Company subtab of the Enable Features page, select the appropriate location to associate with this line.
  
  For information about Locations, see Locations Overview.
9. If you use the Revenue Recognition or Amortization features:
  1. In the Schedule column list, select the appropriate template.
    
    Revenue recognition templates display when the Revenue Recognition feature is enabled. Amortization templates display when the Amortization feature is enabled.
  2. If you select a variable template, you must also select the associated project in the Name column list.
  3. Enter a Start Date and End Date, if needed.
  4. Enter the Residual amount not to be amortized, if appropriate for amortization.
10. If you are using the Automated Intercompany Management feature and the Eliminate box is checked, in the Due To/From Subsidiary column, select a subsidiary that is not the Subsidiary.
  
  The Due To/From Subsidiary defaults to the subsidiary that the intercompany entity in the Name field represents. You receive a warning if the Represents Subsidiary of an entity in the Name field does not match the Due To/From Subsidiary. The values must match if you want to run intercompany elimination for the line.
  
  If this line is the From Subsidiary, the selected subsidiary must be added as one of the To Subsidiaries in the transaction before saving.
  
  If this line is the To Subsidiary, this column value must be the From Subsidiary.
11. In VAT AMT, enter the VAT tax amount for the line, if any.
12. In the Tax Account field, select the account for the tax.
13. The Exchange Rate field is the current exchange rate between the selected currency and the base currency of the Subsidiary in the line.
  
  You can edit the exchange rate on this line for only this transaction. To affect additional future transactions, you can also update the currency record with the entered exchange rate.
  
  If you have multiple rows on the Lines subtab that specify the same subsidiary, they must share the same Exchange Rate. If you have multiple subsidiaries with the same base currency, it is recommended that you keep their Exchange Rate values the same.
  
  If you use the Multi-Book Accounting Overview feature, you can set exchange rates per subsidiary for the primary book on the Lines subtab. Set the exchange rates per subsidiary for the secondary books on the Accounting Book subtab. If a secondary book uses the same base currency as the primary book for a certain subsidiary, their exchange rates do not have to be the same. However, if within the same accounting book you have two subsidiaries that share the same base currency, it is recommended that you keep their exchange rates the same.
  
  Note:
  If you use the Customers and Multiple Currencies feature, the Base Currency column is populated by the subsidiary’s base currency (book-specific) definition.
14. Click Add.
  
  Tip:
  When line details are similar, click Copy Previous and then make modifications as required.
15. Repeat these steps for each line item.
  
  When you finish entering line items, the Debit and Credit out of balance fields at the top of the page should be blank. If either field contains an amount, your line items are out of balance and you cannot save this entry. The net debit and credit amount on the From subsidiary, must be the same as the total net credit and debit of all To subsidiaries combined.
  
  If you have the Automated Intercompany Management feature enabled, you can use the Auto Balance functionality. To automatically add elimination lines and balance the transaction, click Auto Balance. NetSuite automatically populates the balancing lines. For example, if the net amount of a To subsidiary is a credit, NetSuite auto-populates an offsetting debit line with a Receivable type of account.
  
  Note:
  You cannot use a default intercompany journal entry Auto Balance account if that account has a currency or subsidiary restriction that makes the line invalid. For example, if the default Auto Balance account is restricted to the JPY currency, you cannot use it with a journal where the Base Currency (or Transaction Currency) is set to US.
  
  To remove the automatic lines, click Undo Auto Balancing.
  
  Note:
  To use Auto Balancing, go to Accounting > Accounting Preferences > Items/Transactions, then set your preferences for Default ICJE Auto Balance Receivables Account and Default ICJE Auto Balance Payables Account. For details, see Items/Transactions Accounting Preferences.
  
  To post an intercompany journal entry, the total debits and credits must balance by subsidiary for every transaction. Debit and credit amounts between subsidiaries can be different. Upon saving the intercompany journal entry in this case, NetSuite alerts you that the journal entry does not balance between subsidiaries. To save the journal entry, click OK.
This step only applies if you have enabled Departments, Classes, or both, and you classify at the transaction-level rather than the line-level. In the Classification section, select the appropriate classification to associate with this journal entry.

Note:
If you add another line to the journal entry, then the classification you selected is cleared because the Department and Class drop-down lists are filtered based on the subsidiaries you select at the line-level.
On the Communication subtab, you can attach files and notes to this transaction.
1. On the User Notes subtab, enter a title and note for any comments you want to add to this transaction. Click Add after each note
2. On the Files subtab, select and attach files from the File Cabinet related to this transaction. To upload a new file to the File Cabinet, select New from the list in the Attach Files column.
3. Use the Events, Tasks, and Phone Calls subtabs to add to attach activities, such as events, phone calls, and tasks to this transaction. For more information, see Attaching Events, Tasks, and Calls to Records and Transactions.
If the Multi-Book Accounting feature is provisioned in your account, the Accounting Books subtab appears. This subtab shows the secondary books, if any, and their respective base currencies and exchange rates. For information about Multi-Book Accounting, see Using Multi-Book Accounting.
Click Save.
To view the general ledger impact of the created transaction, from the Actions list, select GL Impact.

Important:

When you create an intercompany journal entry for subsidiaries with different base currencies, the general ledger impact reflects the balance in the base currency of the subsidiary.

Note:

When viewing transactions from advanced intercompany journal entries, the permissions set for your user role determines what you are able to view and edit. If you do not have access to all the subsidiaries on a record, you can only view data for the subsidiaries to which you have access. In addition, you cannot edit or copy the record.

To make an advanced intercompany journal entry:

Related Topics