Financial consolidation can be a stressful time, but with NetSuite ERP businesses can speed up the process with impressive results
Whether you’re an established multi-national enterprise or a company going through rapid growth, financial consolidation is a particular pain point you will have to face when multiple divisions, subsidiaries and locations around the world come into play.
What is financial consolidation?
In simple terms, financial consolidation is the process of combining financial data from different subsidiaries or entities within an organisation, pulling the data and rolling it up to a parent company for reporting purposes.
There are a list of complexities companies will have to consider for financial consolidation, including (but not limited to!):
- Foreign currencies
- Multiple languages
- Different account standards
- Variation in taxation structures
- Contrasting compliance and regulatory requirements
These factors often go beyond the capabilities of basic system and spreadsheets, causing stress, costing resource time, and ultimately making the financial consolidation process a bit of a mess. While many companies will consider installing new servers, hiring new IT and finance teams, or trying to get by on manual data entry in spreadsheets to get by – this is not a solution.
Cloud-based software will offer a scalable solution for a more efficient financial consolidation and below are just 3 ways it can achieve this.
1. Automation reduces error and manual effort
NetSuite will automate many aspects of data entry and reporting, which minimises the risk of human error and delay. Creation of any financial report can be partially or fully automated, reducing costs while increasing efficiency.
Not only does automation increase efficiency of financial consolidation, but it will help to improve business process efficiency across the board on a daily basis.
2. Meet local and global requirements
NetSuite will help you meet tax requirements in multiple regions by using an embedded tax engine to allow you to painlessly manage across subsidiaries. From GST and VAT to consumption and general sales tax NetSuite will help you meet local and global requirements in all.
In addition, NetSuite supports 190+ currencies providing you will a solution for managing and updating currency conversion as rates fluctuate. It’s important that your system also record the rates used at the time of any conversion, providing an important historical record of how sums were generated.
3. Visibility across the entire organisation
Visibility is crucial for financial consolidation, a lack of this into divisional and subsidiary performance will hamper performance of the organisation as a whole and make the consolidation process much harder.
NetSuite, as a cloud-based solution, will provide you with complete, real-time visibility – with multiple levels of consolidated reporting and KPIs measurable at any time, from any business entity, anywhere in the world.
See how NetSuite OneWorld can simplify the management of global, multi-entity businesses including financial consolidation and consolidated reporting
Save time and boost efficiency of your financial consolidation with NetSuite
A study conducted by Nucleus Research of users of NetSuite OneWorld found a significant acceleration of financial close and consolidation for its users.
“Businesses migrating from un-integrated legacy and custom accounting systems to NetSuite OneWorld can expect to accelerate financial close times by 20%,” Nucleus found. “Some customers accelerated time to close by up to 50%. Companies with international subsidiaries or multiple legal entities can expect to increase the efficiency and scope of financial and operational data consolidation.”
The ability to consolidate multiple accounts quickly and efficiently is an advantage to any business with subsidiaries and international presence. NetSuite’s true cloud-based software will take your organisation productivity and visibility to the next level.