How to eliminate Accounts from a Consolidated Organisation
Eliminations allow you to exclude a set of transactions or accounts from your reporting – making it easy to discount intracompany loans and transfers when Consolidating multiple entities for Consolidated Reporting and Forecasting.
There are several ways to eliminate accounts described below. Read on for step-by-step instructions for each.
Use simple elimination when you want to remove an entire account from your reporting. This works fine when accounts being eliminated across multiple entities are only used for intracompany trading, and they balance each other out.
This will remove it from your Chart of Accounts for reporting and forecasting purposes and any associated values. An example of how this might look is below:
Automated Eliminations deal with the more complex requirements – for example the accounts do not balance between entities because one of the account is also used for trading with another external entity. Automated Eliminations allow the user to select which accounts they would like to eliminate while ensuring the Chart of Accounts remains balanced by allowing you to insert the offset balance back into your Chart of Accounts. You can create multiple Automated Eliminations allowing you to logically group accounts.
Like the first example, Automated Elimination will remove those accounts from your Chart of Accounts for reporting and forecasting, but retain the transactions that do not balance out. An example of how this might look is:
Manual Eliminations (Coming Soon)
For more complex requirements you can manually eliminate balances by creating a group in your Chart of Accounts and grouping the accounts you wish to eliminate. When you move an account (for example) between Assets and Liabilities FUTRLI will invert the values of the transactions. Therefore if you group accounts together that balance out the group will total to 0, and that group will not be displayed in your reports.
Simple Elimination: How to eliminate a Consolidated Chart of Account line
To eliminate a Chart of Accounts line, navigate to the Chart of Accounts section of the Consolidated Organisation. You can access this by pressing the Settings button adjacent to the Organisation in the Organisations section and then selecting the Chart of Accounts tab. To eliminate an Account, check the Chart of Account line you wish to remove and then click Eliminate:
Automated Elimination: How to create an Offset Group
To create an Automated Offset Group, navigate to the Chart of Accounts section of the Consolidated Organisation. You can access this by pressing the Settings button adjacent to the Organisation in the Organisations section and then selecting the Chart of Accounts tab. Then select the ‘Elimination’ tab.
Create a new Offset Group by pressing the ‘Create Offset Group’ button. This will open a new model where you must enter the following details:
- Account Category: Select the Category to place the Offset Group Account.
- Offset Account Name: Enter a name for the Offset Group Account
- These specify where the unbalanced transactions will be inserted into the Chart of Accounts
- Offset Accounts: Search and select accounts to be included in the offset group. You can select any accounts including those which are already eliminated.
Once you select Create Group you will see the newly created group within the eliminated account. You can edit this group or delete it at any time. Deleting the group will un-eliminate any accounts within the group.