Proposal Summary
This proposal covers the scope of implementing the Oneworld account configuration.
Requirement
The client would like to implement the Oneworld configurations in their account.
Prerequisite
The data for the following need to be provided from UBUY.
- Subsidiary – Provide the subsidiary name, Currency, Country, and parent-subsidiary (Subsidiary structure – This is to arrange them in hierarchy). Also, mention which are the elimination subsidiary (these are maintained when transactions between subsidiaries have to eliminate the revenue and expenses at the consolidated level. And remove the effect of transactions between subsidiaries).
- Accounts – The data of the accounts that is to be created. The following information will be needed. Account Name, Account Number, Account type, currency (for the applicable types), and subsidiary.
- Existing Accounts – Provide the subsidiary of the accounts.
- Provide the information of the vendors or customers (already existing in the account) that should be shared among subsidiaries if any.
- Intercompany customer and vendor – New customer and vendor details needed to be created for all subsidiary combinations.
- Classification (Departments, Segments, etc..) that needed to be shared among subsidiaries.
- Employee – Corresponding subsidiary for all the existing employees.
- Locations – Provide the details needs for creating locations for the subsidiaries if any.
Our Solution
We will perform the following as part of the NetSuite Oneworld account configuration.
- Subsidiary Creation – We will create the subsidiary records in the NetSuite Account which will be arranged according to the hierarchy shared with us.
- Account Creation – We will create new accounts. This will include the subsidiary specific accounts (the bank/cash accounts can only be assigned to a single subsidiary) and intercompany accounts.
- Existing Account – The existing accounts will be automatically set to parent-subsidiary. The account will be reassigned to specific subsidiary shared with us. Please note, bank and cash accounts will not be able to change the subsidiary.
- We will enable the ‘Automated Intercompany Management’ feature. This enables you to manage intercompany transactions and automatically generate elimination journal entries.
As part of the period close process, NetSuite evaluates the activity in your intercompany accounts. It then creates journal entries to eliminate artificial profit and loss amounts. Without this feature enabled, you must manually create and track all intercompany transactions, and then manually create and post-elimination journal entries.
- Intercompany Customer and Vendor records creation – Intercompany customers and vendors are entity records with one or more assigned subsidiaries that NetSuite uses for intercompany transactions. They represent the buyer and seller in transactions between subsidiaries.
You can enter intercompany entities on sales orders and purchases orders to create intercompany transactions. You can also identify an intercompany customer or vendor on journal lines when you create an advanced intercompany journal entry. You must enter an intercompany entity for lines that include an intercompany receivable or intercompany payable account.
So, we need to set up a vendor and customer record for each subsidiary combination if there are transactions between the subsidiaries. It will be created based on the details you have shared with us.
- Updating already existing entity records – All the customers and vendors will be automatically assigned to the Parent subsidiary. If existing entity records (such as those for customers, vendors, etc.) need to be shared among subsidiaries, we will update them. If more subsidiaries need to be assigned to a single customer or vendor, we will need to enable the Multi subsidiary feature for this.
- For the items, we will assign them to parent-subsidiary and check the ‘Include children’ box so that they are shared among all subsidiaries.
- For departments, segments and other classifications, it will be auto-assigned to the parent subsidiary. These classifications will be reassigned to the specific subsidiary shared with us.
- Location creation – We will create new locations and will assign subsidiary based on the details provide to us.
- Employee – The existing employee will be assigned to the specific subsidiary based on the data provided with us.
Assumptions
- Assume that Tax Codes and Tax types configurations are not needed for the Oneworld setup in UBUY.
- There is no additional currency set up needed in the account.
- There will be transactions in the parent company. If there are any transactions in new subsidiaries, need to select the corresponding subsidiary in the transaction record when creating manually.
- Assume that UBUY is not using any PDF from NetSuite.
- Assume that all items needed to be usable in all subsidiaries.
- Assume that the subsidiary on the existing transaction will not need to be changed after converting to the Oneworld account.
Scope Limitation
- We assume that in import, the subsidiaries in the sales order (or Transactions) will always be the primary subsidiary set in the customer record. So, we are not providing an option in the custom import to set the subsidiary of the transactions. If a transaction needed to be created in another subsidiary (other than the primary subsidiary of the customer) the import scripts needed to be updated and which will require extra effort.
- Assume that NetSuite PDFs for the transactions is not used in the UBUY NetSuite account. So, no changes or updates will be required based on Oneworld changes. If any PDFs needed to be updated based on Oneworld changes it will be considered as an extra effort.
- Assume that the static account used in the Journal created form the custom refund with item record will not be changed after the Oneworld account change. If there are changes needed after moving to Oneworld NetSuite account, extra effort will be needed to do the same.
- Currently, the base amount in searches (or reports created using saved searches) or reports is in KWD (the base amount of the NetSuite account). But after changing to Oneworld, the base amount in the searches or in the reports will be in the base currency of its corresponding subsidiary. So, any updates are needed in the searches or reports in future due to this, extra effort will be required.
- The Tax code setup is not used in NetSuite. If any Tax code setup is needed it will be considered as extra effort.
- Existing locations will be auto-assigned to the parent-subsidiary. Subsidiary change in the existing location is not considered in this scope. If there are any, it will be regarded as extra effort.
Risk
- The ‘Automated Intercompany Management’ feature cannot be disabled after it is enabled. This is true even if you have not created any intercompany entities or transactions.
- The subsidiaries can be created manually. This cannot be imported as bulk.
- Existing customer and vendor subsidiaries cannot be changed. By default, the parent-subsidiary will be set on those.