What are the features of NetSuite Advanced Financials?
Financial management involves planning, organizing, directing, and controlling the financial activities of an organization, including procurement and utilization of the funds. It applies the general principles of management to financial resources in order to maximize the financial gains of organizations. NetSuite’s sophisticated financial management module, Advanced Financials, offers users a range of features to simplify tracking of expenses and ensuring that budgets remain under control. With the help of Advanced Financials, finance departments can automate billing processes and cut down on the amount of manual labour required. The main features of NetSuite Advanced Financials include:
- Budget Management and Reporting
- Expense allocations
- Statistical accounts
Budget Management and Reporting:
- Budget Management and Reporting is utilized by financial planning and budgeting teams on a monthly basis to closely monitor budget vs actuals. Budget reporting is a detailed report of the actual year-to-date financial position and a full year’s forecast. It includes a profit and loss statement, cash flow statement and balance sheet (Read our blog on Important Financial Statements for Financial Reporting)
- Netsuite helps easily track and manage budgets
- Simply enter budgets for accounts on a single screen, or use the Copy Budgets feature to rapidly create an entire budget based on a preexisting one, or on actuals together with an uplift/downlift. Alternatively, create budgets in Excel and import them via CSV
- Enter expenses without assigning them to classes, departments or locations, and later allocate them according to a weighted formula. Allocation schedules can be used once or set up to recur on a regular basis
(Read our blog on how NetSuite can help streamline financial reporting)
- To stay profitable, a company has to determine the total expense of providing its products or services. Often, companies break these costs down on a department-by-department basis, by company program or by product; to assess what individual departments and programs cost to run and what certain products cost to make. An accurate accounting process must take all expenses into consideration. Expense allocations are required by several accounting frameworks in order to report the full cost of inventory in financial statements.
- With NetSuite Advanced Financials Expense Allocations, it’s easy to enter expenses without assigning them to classes, departments or locations, and later allocate them according to a weighted formula. Allocation schedules can be used once or set up to recur on a regular basis
- Dashboard reminders notify users when current allocation schedules need processing. After reviewing, create journal entries for all the plans with a single click
- Amortization is an accounting technique used to periodically lower the book value of a loan or intangible asset over a set period of time. It typically refers to the process of writing down the value of either a loan or an intangible asset and is used in the process of paying off debt through regular principal and interest payments over time. Amortization schedules are used by lenders, such as financial institutions, to present a loan repayment schedule based on a specific maturity date. Intangibles amortized (expensed) over time help tie the cost of an asset to the revenues generated by the asset in accordance with the matching principle of GAAP.
- In NetSuite amortization schedules enable automated amortization of expenses over time and streamline processes, such as the amortization of prepaid costs
- In NetSuite amortization schedules can also be linked to jobs to amortize expenditures in proportion to a job’s percentage of completion
- Statistical accounts are non-monetary accounts that can be used to maintain statistical information for a variety of metrics. For example, a statistical account could be established to maintain the employee headcount by the department in an organization.
- NetSuite store values for your most critical non-monetary data such as headcount, floor space and common shares
- NetSuite automatically allocates financial activity across the business proportionately
- NetSuite Run multiple allocation schedules in specific sequences
What are the key benefits of Advanced Financials?
- Get clear real-time visibility into budgets
- Improve productivity with automated expense allocation and amortization
- Calculate allocations dynamically using statistical accounts
- Supports management of multiple budgets
- Enables monitoring of budget versus actual in real-time
- Allocate expenses by GL account, class, department and location
- Link amortization schedules to bills, bill credits, projects and more
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(Blog content contributed by Tvarana team member Karthik Beeram)