Master Financial Reporting with NetSuite Advanced Financials

Efficient financial management entails planning, organizing, and controlling an organization’s financial resources to ensure funds are used effectively and responsibly. It applies core management principles to financial activities such as budgeting, expense tracking, and fund utilization, with the goal of improving financial performance. NetSuite’s Advanced Financials module supports these objectives by providing robust tools for managing expenses, obtaining budgetary control, and reducing financial oversight. By automating key processes such as billing, financial reporting, and tracking, NetSuite Advanced Financials helps finance teams reduce manual effort, improve accuracy, and operate more efficiently. In this blog, Tvarana shows how NetSuite Advanced Financials automates budgets, expense allocations & amortization for real-time financial visibility and control.

Key Features of NetSuite Advanced Financials

The main features of NetSuite Advanced Financials include:

• Budget Management and Reporting
• Expense allocations
• Amortization
• 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)

‍Expense Allocation

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

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

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

Key benefits of NetSuite 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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