Intercompany Journal Entry: Migrating Offline Financials to NetSuite

By - September 9, 2021

What is an Advanced Intercompany Journal Entry?

An advanced intercompany journal entry is a specialized record type available only in OneWorld accounts. An advanced intercompany journal entry records debits and credits to be posted to ledger accounts for transactions between an originating subsidiary and multiple receiving subsidiaries. When you use advanced intercompany journal entries, you can also change the transaction currency to any currency set up in your system. In an account that has the Multi-Book Accounting feature enabled, you can also use this record type to create book specific advanced intercompany journal entries.

  • Transactions > Financial > Make Advanced Intercompany JE.
  • Note: Using the Advanced Intercompany JE is best practice.

Client Instance:

  • Client has been maintaining child subsidiary in offline Excel workbook.
  • Activity recorded on the child is recorded in the offline workbook and put to the parent subsidiary within NetSuite.
  • Client desired that the offline workbooks be brought in to NetSuite under the child subsidiary and removed from the parent subsidiary financials.
    • Note: Client has child subsidiary already created in NetSuite.

Process description:

Environment walkthrough with client

  • Financial statement review
  • Intercompany review
  • Day-to-day activities review
  • Pain points

Client provided sample financials for proof of concept

  • Offline financials reviewed
  • Intercompany journal entry prepared & proposed based on sample financials
  • Entry reviewed with client

Client provided financials as of end of year

  • Financials reviewed
  • Intercompany journal entry constructed from year end balances
  • Journal posted to sandbox environment for 1/1
    • GL impact reviewed by client
  • Month end journal entries review and entered in to system
    • Client signoff
  • Client Production posting
    • After client approval in sandbox, project team to meet and enter in production together
    • Once entry is prepared and reviewed by all parties proceed to post
    • Review GL impact
    • Review Balance Sheet

Additional information:

If you use the Customers and Multiple Currencies feature, the Base Currency column is populated by the subsidiary’s base currency (book-specific) definition.

If you select a subsidiary in the Subsidiaryfield that is assigned to one or more shared vendor or customer records, you can make advanced intercompany journal entries for any of the vendors or customers to which the selected subsidiary is assigned. To do this, on the Lines subtab, select the shared vendor or customer from the Name

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 use Auto Balancing, go to Setup > Accounting > Preferences > Accounting Preferences, then set your preferences for Default ICJE Auto Balance Receivables Account and Default ICJE Auto Balance Payables Account.

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.

An intercompany journal entry is a widely utilized feature within NetSuite OneWorld accounts and should be reviewed prior to using in NetSuite. The main use is managing intercompany activity between subsidiaries. In this instance, the client’s financials needed to be removed from the parent and put towards the child. Following any entry the GL impact and balance sheet should be reviewed to ensure tie out to files.

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