Automating Multi-Entity Accounting

For companies with a single entity, accounting is very straightforward. Information is collected, transactions are recorded, financial information is reported, and decisions are made based on that information.

However, in multi-entity companies, accounting is much more complex. When multiple subsidiaries, operations, or locations are involved, the ability to consolidate all the information and create financials for each node of the hierarchy is a very time-consuming process.

Accountants immersed in these multi-entity accounting environments typically have two things on their wish list: greater efficiency, and better reporting. Their current processes involve tedious, manual entries and correcting errors that result.

USE CASE EXAMPLE: INTERCOMPANY ELIMINATIONS

As an example, let’s imagine that a company has two separate entities on different systems. But there are many expenses that are shared between these entities, such as Internet services.

The $5,000 Internet bill is received and must be allocated 50% to each company.

Transactions must be recorded to allocate $2,500 to Company A, $2,500 to Company B, and then account for the intercompany adjustments between the companies. That is four separate transactions that must be recorded for this one simple example.

In reality, accountants in multi-entity environments may be capturing hundreds or thousands of these transactions every month through a process that is typically highly manual, time-consuming, and prone to errors. The pains are magnified further when the number of entities reach double digits and beyond.

In sharp contrast, if the accounting team in this use case scenario were using Flexi’s accounting software, only one entry would be required. This is because Flexi automates multi-entity accounting in unique ways that result in big savings for our customers. Less entries mean less errors, resulting in cleaner data, and providing real-time reconciliation.

THE FLEXI DIFFERENCE: AUTOMATING MULTI-ENTITY ACCOUNTING

Most accounting software was designed for a single entity. Additional functionality may have been added as multi-entity needs surfaced throughout the years. It’s a little like altering a piece of clothing to reflect the changing trends over the years. It just never quite works right.

Flexi is unique. From our very beginning over 30 years ago, the core of our accounting software was built for multi-entity accounting. This functionality is ingrained in our system, right down to the data structures.

The built-in functionality delivers powerful automation for multi-entity accounting. Time-saving highlights include:

• Automated consolidation of financial data for an unlimited number of entities, even if multiple GL systems are involved.
• Automated intercompany eliminations.
• Automated conversion of multiple currencies.
• Automated, real-time reporting and analytics that enables the ability to see performance across all entities, drill down to view transaction details, slice and dice data any way needed – all from one screen.

These are just some of the powerful features that make Flexi’s accounting software an outstanding choice for multi-entity companies.

Schedule a personalized demo to see how Flexi can automate multi-entity accounting for your company.