Determine how many books the customer will need. Consider discussing these items with the customer:
• Which currencies do they need to report in (in addition to their subsidiary currency)?
• Will they need different accounts to be used for different accounting books? If so, how many additional books will be required. NB: not all account types are currently supported for account mapping (e.g. Bank accounts are not supported for multi-book.)
• Is there a relationship between the book-specific accounts and those used by the primary book?
• Do they need to use different accounting rules for revenue recognition, expense amortization, and fixed asset depreciation in different account books? • Do they need book-specific COGS methods for inventory? This is not currently supported.
• If using Intercompany Inventory Transfers, confirm if the currency of the primary book is the same as that of the secondary book. It is recommended that these should be the same as there is no exchange rate on fulfillment transactions. A manual adjustment to the secondary book will be required if these are not the same in order to account for any currency variations.
• Discuss the overhead required with maintaining each book; the benefits should outweigh this – if not, try to simplify the requirements.
• Up to five books are supported (Note: Inactive books and Adjustment Only books are not included in the total number of books). Accounting books can be closed separately per subsidiary. It is recommended that Historical Transaction Processing (HTP) hidden feature is provisioned to the account when Multi-Book Accounting is provisioned, regardless of whether it will be used or not.
• Updating historical transactions should be used with caution and should always tested in the customer’s sandbox first. The customer should review their exchange rates for all populated periods. The Historical Transaction feature needs to be enabled via the support team before it can be used.
• If inventory is enabled, the secondary book’s effective date needs to be at least the first period where inventory transactions take place.
• Consolidated reporting is available across all accounting books. You can enable consolidated reporting by checking the Enable Consolidation checkbox on the accounting book record.
• Employee transactions (payroll) will be restricted to the primary book of their subsidiary. Expense report can handle multi-currency already.
• Post-2012 Revenue Commitments are now a non-posting transaction. HTP does not handle the creation of both posting and non-posting Revenue Commitments (based on the transaction date). This will need to be considered when setting the effective date of the secondary book. Setting the effective date to latest date (e.g. 2018) renders the past periods (prior to 2018) as locked periods and we cannot make GL impacting changes to any past book generic transactions (prior to effective date of secondary book) For example: Primary book has a transaction in 2018 and the secondary book effective date is 2017, 2019. Book-generic transactions in 2018 cannot be created nor edited. You can, however, reopen the period for primary book only and enter/edit book-specific transactions in primary book
• Currency re-measurement is not currently supported in NetSuite. The solution is to measure in functional currency, so you don’t have to re-measure to functional currency. To do this, set the base currency of the subsidiary to its functional currency. Transactions recorded in that subsidiary will be measured in functional currency in that case. There are some things to consider:
o Local reporting in local (non-functional) currency won’t come from your primary book. In the secondary (local, statutory) book, the base currency of the subsidiary is set to local currency. Local financial statements and tax reports are generated from the secondary book.
o Employee entity records have a currency set and locked to the primary book base currency of the subsidiary to which they are assigned. This means that payroll transactions are going to be functional currency transactions, not local currency transactions. Generally, that’s not going to be desired. You may need to substitute vendors for employees and purchase requests / vendor bills for payroll transactions. (Note that in the past, this was applicable also to expense reports – those can handle multiple currencies already)
o Legacy Intercompany journals are limited to the base currency of the two subsidiaries referenced on the transaction. If the intercompany agreements are denominated in a currency different from functional currency, this could cause a problem. You can define the intercompany vendor / customer entities to have a different currency and use the PO/SO/Invoice/Bill intercompany workflow. Alternatively, you can split the intercompany journal into two single-company journals in foreign currency. This will work but the intercompany link is broken and the intercompany eliminations will be piecemeal (and less elegant). New Advanced Intercompany Journals do not have currency restrictions.
o The local currency bank account will likely be the primary operating account for the foreign subsidiary. Since this is not going to be a base-currency bank account, you won’t be able to record non-local currency transactions in the account. You will likely need a base (functional) currency bank account record to record non-local transactions. Use a bank transfer or journal in local currency to clear the base currency bank account to zero and record the transaction in the local currency account.
o This method does not work well if the foreign subsidiary is not recording detailed transactions in NetSuite. i.e. If they provide a trial balance and that’s uploaded as net change for the month via journal. If this is the case, it is recommended that you re-measure externally and then import the functional amounts.
o An alternative to this set-up is to perform re-measurement externally to NetSuite and book adjustments in an elimination subsidiary or a roll-up subsidiary. This has its own drawbacks and should be worked through with the customer before recommending it.
• If the only difference between the accounting books is posting of book-specific adjustments (using books specific journals), you should consider using Adjustment-Only book for easier implementation and maintenance.
• If there is one to one relationship between accounts in primary and secondary book, it is generally easier to use Accounting Contexts than Account Mapping