Enabling and Configuring Balance Sheet Groups

You can create a single set of intercompany to and from accounts and use with each balance sheet group you create or you can create a set of intercompany to and from accounts for each balance sheet group.

The following is a list of e-automate transactions that can affect the intercompany accounts identified on the balance sheet groups.

Sales fulfillments

Inventory transfers

Cashbook transfers

Cashbook deposits (only when the cashbook account is not shared with all balance sheet groups)

Vendor Payments (only when the cashbook account is not shared with all balance sheet groups)

Cashbook Payments (only when the cashbook account is not shared with all balance sheet groups)

Payroll Payments (only when the cashbook account is not shared with all balance sheet groups)

Customer refunds (only when the cashbook account is not shared with all balance sheet groups)

Accounts receivable payment applications

Accounts payable payment applications

General ledger journal entries

Accounts payable allocating costs

In order to support financial transactions that span multiple balance sheet groups you are required to define intercompany accounts. Traditionally, you define a set of two intercompany accounts per balance sheet group or you can use the same two intercompany accounts across multiple balance sheet groups. These accounts are defined as intercompany due from account and intercompany due to account. e-automate automatically uses these accounts when necessary to accommodate movement across branches and balance sheet groups. Best practice recommendation is that the intercompany due from account is a Current asset account and the intercompany due to account is a Current liability account but you should consult your accountant to determine the exact account type recommended.

By using intercompany accounting it ensures that the specific branch units are charged at the general ledger level with all of their credits and/or debits within an organization. For example, an organization that has multiple branches and balance sheet groups may have a primary branch that creates and receives all inventory. Once inventory is received it can be distributed to the various branches using inventory transfers. When inventory is transferred from the primary branch to another branch e-automate creates the general ledger entries to keep the balance sheet groups in sync. When the transfer occurs, assuming the item has already been received into the primary branch warehouse, the transfer would credit inventory for the reduction in inventory for the primary branch balance sheet and debit the identified intercompany due from account. In addition to accounting for inventory leaving the primary branch, e-automate would account for inventory being received into the receiving branch by debiting inventory for the increase and crediting the intercompany due to account. You determine how or if the balances of the intercompany accounts are addressed.

Contracts - When processing service contract invoices with multiple equipment from various branches, e-automate uses the branch identified on the contract equipment to determine to which branch financial entries should be associated. Overages and meter group base rates follow the same logic; entries are associated with the branch assigned to the equipment on the contract. The branch on miscellaneous charges can be directed using the Branch field. Lease entries on service contracts are posted and associated with the branch identified on the Billing/Contact tab in the Branch field.

Inventory Transfers – Any transfer that causes inventory to move across balance sheet groups by virtue of the branch assigned to the warehouse or that crosses costing pools, requires a general ledger entry. Intercompany accounts are hit to accommodate the balance sheet changes for the transfer.

Inventory Adjustments (Increases and Decreases) – When processing increases and decreases e-automate determines the balance sheet group affected by the branch assigned to the warehouse to which the item is being placed or the item is being removed. This can be overridden at the line item detail level.

Inventory Adjustments (Cost)– When processing inventory adjustments, e-automate determines the balance sheet groups affected by the adjustment by looking to the branch assigned to each line item on the adjustment. If there is only a single warehouse, then only one balance sheet group will be affected. If there are multiple warehouses that belong to multiple balance sheet groups, then e-automate will use the respective branch and balance sheet group. Best practice recommendation is when recording adjustments you adjust by warehouse the quantity contained within the warehouse when warehouses are on different balance sheet groups. 

Physical inventory – When posting inventory adjustments, either increases or decreases as a result of physical inventory variances, e-automate use the branch assigned to the warehouse from which or to which items are either drawn or added.

Misc. Charge Invoice, Credit, and Debit – When processing miscellaneous charge invoices, you define the branch for each line item on the transaction. e-automate posts to the appropriate branch balance sheet for each unique balance sheet group for accounts receivable as well as tax details. If freight is identified on the invoice, e-automate distributes the header level freight to all branches on the transaction by each branch’s revenue percent contribution to the invoice subtotal. Intercompany entries can occur.

Refurbishment/Assembly – When processing refurbishments or assemblies, e-automate can both consumer and create inventory quantities. When consuming, e-automate uses the branch associated with the warehouse from which inventory is drawn. When creating inventory, e-automate uses the branch identified on the header of the transaction. Overhead and labor is associated with the balance sheet group assigned to the branch identified on the transaction. Intercompany accounts can be used when appropriate.

Finance charges – When processing finance charges, e-automate associates the finance charge according to same balance sheet groups distributed on the invoice for which the finance charge is being charged. If there are multiple invoices, the finance charge transaction distributes for all invoices.

Sales Invoices – When processing sales invoices, e-automate uses the balance sheet group associated with the branch assigned to the transaction for all entries. The only exception is when inventory it drawn from a warehouse not associated with the same balance sheet group as the transaction and then e-automate makes the necessary entries to accommodate inventory moving from one balance sheet group to be sold in another.

Service Invoices – When processing service invoices, e-automate uses the balance sheet group associated with the branch assigned to the work order, one branch per work order. This means all calls have to be associated with the same branch. All labor, travel, miscellaneous charges are accounted for with the balance sheet group on the transaction. The only exception is when inventory is drawn from a warehouse that belongs to a branch associated with a different balance sheet group.

Vendor Invoice, Credit Memo, and Debit memos – When processing vendor invoices you identify branches by the line item which in turn identifies balance sheet groups when applicable.

Purchase receipts – When processing purchase receipts, e-automate uses the balance sheet group associated with the branch assigned to the warehouse when inventory is being received or un-received. Multiple warehouses can be on a receipt; therefore multiple balance sheet groups can be affected.

Purchase Order Invoices, Credit Memos, and Debit Memos – When processing purchasing invoices, e-automate determines the balance sheet group by the branch assigned to the warehouse in which inventory items are received. If there are adjustments on the purchasing invoice, credit or debit, e-automate adjusts the appropriate balance sheet group based on the branch assigned to the warehouse.

Allocating Costs – When allocating third party costs on vendor invoices e-automate affects balance sheet groups to the degree that the original vendor invoice at two levels. The first level depends on the balance sheet groups affected by the original vendor invoice due to the fact that allocate costs reverses the vendor invoice entries and allocates the charges back to the inventory. The second way is to increase the balance sheet group inventory value based on the items that are adjusted.

Vendor Payments – When processing payments for vendors associated with vendor invoices or purchase order invoices, e-automate takes into account the balance sheet groups associated with the payable invoice and appropriately posts to remove liabilities in conjunction with balance sheet groups on the invoices. When performing partial payments and balance sheet groups are enabled, users can modify how the splits are configured among different balance sheet groups on the transaction.

Unapplied Vendor Payments– When processing an unapplied vendor payment, e-automate requires the user to identify a branch, by identifying a branch e-automate can correctly identify the balance sheet group for the payment. The application of the payment is when it will adjust the various balance sheet groups based on the invoice to which the unapplied payment is applied.

Accounts receivable payments– When processing payments with balance sheet groups enabled, e-automatically posts to the correct balance sheet group based on the balance sheet groups on the invoice to which you are applying payment. If a customer decides to provide a partial payment, e-automate equally distributes the partial payment to the different balance sheet groups on the invoice based on each balance sheet group’s percent contribution to the subtotal. You can override the automatic distribution and specify your own distribution. If you decide to use the advanced add for multiple invoices on an accounts receivable payment, e-automate will automatically prorate the balance sheet groups.

Unapplied accounts receivable payments– When processing an unapplied customer payment, e-automate requires the user to identify a branch, by identifying a branch e-automate can correctly identify the balance sheet group for the payment. The application of the payment is when it will adjust the various balance sheet groups based on the invoice to which the payment is applied.

Re-Applying Accounts receivable payments – e-automate would simply un-apply the balance sheet groups that were applied when payment was originally received or applied and apply to the new invoice or invoices based on the balance sheet groups associated with the original invoice. If it is a partial payment, the user can define the splits by balance sheet group or accept the automatic proration of a partial application. To edit the splits the user would use the edit detail window and configure the splits. Using the editing the splits in the detail accessed from the Re-apply Payment window.

General Ledger Entries– You identify the branch when doing a general ledger entry and the branch is assigned to a balance sheet group.

Fixed Assets – Fixed assets are associated with balance sheet groups by assigning the fixed asset to a branch. Branches are assigned to balance sheet groups. In stock fixed assets do not use the branch on the warehouse in which they are stored but the assigned branch’s balance sheet group.

Fixed Asset Adjustments – When fixed assets are adjusted, e-automate pulls the branch from the fixed asset and uses it on both the asset and the accumulated depreciation.

Payroll Payments – Balance sheets groups are affected by payroll import based on the branch identified on the import, if any. If there is no branch on the import, e-automate uses the branch identified on the employee record.

Cashbook Receipts – When recording cashbook receipts e-automate uses the balance sheet group associated with the branch identified on the transaction.

Cashbook transactions (interest, payments, instant check, bank fees) – When recording cashbook transactions e-automate uses the balance sheet group associated with the branch identified on the transaction. If there is not a balance sheet group associated with the transaction, the end user can select the required balance sheet group.

Cashbook Deposit – When depositing payments, e-automate uses the distribution specified when recording the payment to determine the branches and associated balance sheet groups, this assumes the cash is shared across balance sheet groups. If a specific branch and balance sheet group own the cash, e-automate makes the necessary intercompany entries to allocate all the cash to the branch assigned on the cashbook account.

Cashbook Transfers – When transferring between cash accounts, e-automate uses the balance sheet group associated with the cash account, if any. If there is not a balance sheet group associated with the cash account, the end user can select the required balance sheet group. e-automate makes the necessary entries to balance the transaction with intercompany accounts as necessary.

From the Accounting menu, select General Ledger Accounts to open the General Ledger Accounts window.

Click [New] to open the New General Ledger Account window.
Note: Before you open the New General Ledger Account window, it is a good idea to determine the account number for the intercompany accounts you are creating.

In the Number field, enter the number you want to assign to one of the intercompany accounts.

In the Name field type the name of either the intercompany from or the intercompany to account.

In the Type field use the lookup to select an appropriate account type. Best practice recommendation is the intercompany from account is a current asset account and the intercompany to account is a current liability account.

In the Protection field, use the lookup to select Intercompany.

Click [OK] to save your account.

Repeat steps 1 through 7 to create both intercompany accounts for each balance sheet group.

Note: Before creating multiple balance sheet groups, best practice recommendation is you create your branches and the settings associated with them prior to enabling multiple balance sheet groups. For additional information on creating branches, see Enabling Branching and Creating Branches in the e-automate options section and the general accounting section.

From the Tools menu, select Options to open the Options window.

In the left pane, click [+] next to the word Company, or double-click the word Company to expand. Click Departments and branches to display the Departments and branches settings.

If Use branching is not already checked, check Use branching.
Note: For additional information on branching see the topic, Enabling Branching.

Check Use multiple balance sheets to open the Edit Balance Sheet Group window.

In the Number field, type the name of the primary balance sheet group.

In the Name field type the name of the primary balance sheet group.
Note: You create the first balance sheet group when you enable balance sheet groups. You configure other balance sheet groups later.

In the Intercompany due from account field, use the lookup to select your created intercompany from account.

In the Intercompany to account field use the lookup to select your already created intercompany to account.

E-automate automatically adds all branches to the balance sheet group. To remove a branch, in the Branches that belong to this balance sheet group region, select the branch that does not belong to this group and click [Delete].
Note: Repeat this step until all branches that do not belong to this group are removed. You must have at least one branch assigned to the primary balance sheet group.

Click [OK] to create your primary balance sheet group.

Click [OK] to save your administrative option changes.

In the Attention window, click [OK] to acknowledge the restart e-automate message and restart e-automate.

From the Accounting menu, select Balance sheet groups to display the Balance Sheet Groups window.

Click [New] to open the New Balance Sheet Group window.

In the Number field, type a number to designate this balance sheet group.
Note: You can use letters or numbers to identify a balance sheet group.

In the Intercompany due from account field, use the lookup to select your created intercompany from account or the accounts you created for this balance sheet group.

In the Intercompany to account field use the lookup to select your already created intercompany to account.

In the Branch field, use the lookup to select a branch you want to be a member of this balance sheet group.

Click [QuickAdd] to add the branch to the list of Branches that belong to this balance sheet group region.

Repeat steps 6 – 7 to add additional branches to the balance sheet group.

Click [OK] to save your balance sheet group.

Repeat steps 2 through 10 to create additional balance sheet groups until all branches are members of a balance sheet group.
Note: Branches can only be a member of one balance sheet group. You can have multiple branches in a single balance sheet group when you want to have branches share a single balance sheet. If you want a balance sheet for each branch, you should only add one branch to each balance sheet group.