Arti Patel Martinez, ProAdvisor Training & Certification Leader: On today's episode of In the Know, we'll be exploring the latest product releases in Intuit Enterprise Suite.
Hey ProAdvisors, it's Arti, and you're watching In the Know, where you get exclusive access to demos of Intuit product enhancements by the leaders who built them.
Let's jump right in with Likith, who will show us a demo of what's new in Intuit Enterprise Suite.
Likith, welcome!
Likith Lanka: Hey, all. I'm Likith, a product manager on Intuit Enterprise Suite, and I'll be showing you a couple of features that we launched in June. Before that, I'll quickly share what's coming in.
We've continuously heard concerns with Intuit Enterprise Suite that the balance sheet is not balancing. The primary reason being is that, as of today, we only had account- level eliminations before this release. With that, you did not have an option to drill into what was a mistake that you have done while you're doing intercompany transactions with this release, which I will explain in detail. When you do an intercompany transaction, we are automating the intercompany elimination as well.
With that, you have a paper trail to track where your balance sheet is not balancing, which is essential. In addition, for complex and large organizations, we now have a multi-level consolidation structure without having this manually done on your Excel. So, these are the two features that we are launching.
I'll quickly start doing a live demo to show the product. Before that, who is this for?
Like I mentioned, it's for multi-ended businesses of large scale. So if you have mid to complex businesses that are higher in revenue, and have multiple organizations or companies, this is for them. We launched eliminations as a general audience, so that we are SOC 2 compliant, but consolidations are still early access. I will specifically call up what's available, and of course, Intuit Enterprise Suite is only available in the US as of now, so these features will be only in the US.
Let me quickly jump to share my screen. I'll start with eliminations as of today, which is before June 1. We only have account-level eliminations, which means you're essentially filtering on the reports, but not really eliminating with that. If there's some incorrect accounting that's being done, there is no way that you can figure that out, which might also lead to compliance issues. So what we did is we launched the full elimination settings with transaction eliminations. What that means is for every transaction, you have much more granular controls.
I'll discuss one, which is an intercompany journal entry and much more popular. For the intercompany journal entry, you still need to apply the account eliminations like you were doing earlier, but instead of eliminating from the report, now we'll create a paper trail, which I'll get back to in a second. In addition, this is for all the other transactions such as intercompany allocations, intercompany sales, and cross company bill payment, which is again something that we launched recently as a beta at early access. You will have granular controls, so based on your business needs, you can control these as needs to be. For example, for intercompany sales, maybe you have COGS, and it's a very complex use case for you. Being a manufacturing client, you can potentially use it as a review, and you can decide on it right now.
I'll demo one transaction, which is an intercompany journal entry. So from the accounting intercompany transactions, I'm creating a journal entry. You can create this from multiple places over here. Let's assume that I'm transferring my cash from one of the global companies to two other companies, so I'm doing that for $10,000. I'm moving that from one for manufacturing and one for services, and I do need to transfer $6,000 to one company, and then another $4,000 to another company. Observe that I only fill the business lines or the profit and loss lines that I need, while I did not complete the whole form. Over here, I'm using the smart complete button to just click this, and immediately all the information populates. So with this, you don't have to think through on what is the additional information, what you have to do, what are your due to and your firms, etc. Once I'm comfortable with this, and once I review, of course you can always undo. I'm saving and posting, so as it saves, you observe that the elimination is automatically linked to this transaction, giving you a pure, like a complete paper trail. I'm clicking that elimination to validate, and you see all the due to and due from accounts got balanced. So I'm closing this and moving back to the intercompany transaction page.
Now that you’ve eliminated automatically, I want to see how this is the thing of the report before I jump into how this looks on the report. I want to set the expectation in a particular organization, Multi-MP organization. You can only eliminate the group that you're looking at. In this example, I selected all the companies and, of course, the elimination. I should apply to all the companies, but let's assume that I'm only looking at my numbers partially across a certain subset of companies.
In this example, I have six companies. When I apply all of them, of course, I need to eliminate anything internally happening, but at the same time, let's say I'm removing the services company. Keep an eye on the service numbers. Here, I'm removing this on the services company. I unfiltered it, removed that, filtered it, and then clicked it outside. As soon as I did that, services went away and the related eliminations also went away. You don't have to manually do it like all of our competitors do. All of this is automated for you. You don't have to set up your phantom entities and you don't have to do it manually; the job is done for you.
So now, how does this help you further? Before I jump into the consolidations, I want to clarify that some of our features are early access. We are deliberately calling this early access because some of the functionality is still maturing. It might still be valuable for some of your clients, depending on the complexity, but we want to only release it generally once they're fully available, like features are fully baked in. In this case, from settings, your admins can go into early access and observe what are the features that can be available. Cross company bill payment, where you can pay bills from one company to another is another new feature that we launched recently. I'll be demoing the inter company, like the NP hierarchy and the consolidations, right now. That is also one of the beta early access features. From the settings, once you do enable beta in a couple of days, you should see this option.
In my organization, I have a legal structure, which I, which I want to, and then, of course, legal structure is mostly for legal reasons, but maybe internally the management always refers to the management structure, which is very common. I can set up multiple hierarchies here, and remember, our eliminations are automated, so you don't have to set up elimination entities per hierarchy, like competitors, but you can see that it's all automated. You can go into the consolidation rules and set up your consolidation rules as well. For example, if you have a family business who does not care about GAAP, you can definitely use proportional consolidation. A large organization specifically might care about gap compliance, and we are supporting two methods here, which is not consolidated and full consolidation.
One of the biggest reasons why we didn't launch a general release is because we don't have an equity method, which you can clearly see, but of course you cannot consolidate and just do one manual adjustment for now. While we are actively working on an equity method soon, we don't have a timeline yet.
Once you set up the hierarchy, now I'm going to the reports, standard reports. I'll go back to the same balance sheet report, which I showed you earlier. Instead of picking per company, I'm going into my management hierarchy. Now once I click the management hierarchy, you can see this multi-tiered hierarchy that's showing up on the reports, so global consolidated. Global holdings is nothing but the sum of manufacturing and construction. When I drill into manufacturing, you can see that there is nothing, because the percentage is less than 50% here, so it falls under the no consolidation. Similarly, when I go up here and drill into construction, you can see that the numbers are based on this company.
Now let me switch to legal. When I switch to legal again, it shows the ownership structure as opposed to legal. When it runs into manufacturing based on that particular structure, you can see that it's categorized as 100%. All of this is automated based on the setup that you've done and based on your business needs, so that you don't have to do anything. Again, one of the key advantages of using Intuit Enterprise Suite is you do not have to, you do not have to do eliminations again per hierarchy, because based on the ownership structure, based on the rules you set, all of that is prorated and calculated automatically based on the selections. There's one setup, and then everything is done.
Before I end, I want to make one clarification. We did launch account eliminations a couple of years ago as a starting point when we launched Intuit Enterprise Suite. But now that we are transitioning to the transactional eliminations, some of your customers who might be on account eliminations might have to do a one time catch up process to make sure that the balance sheet is balanced. For example, let's say you let us say you are using an intercompany. Transactions, of course, there is zero work for you to do. Do we automatically put you on to the new eliminations? There's nothing to do, but we also observe that some of our accountants use regular journal entries or regular transactions as opposed to intercompany transactions. Of course, there's no way that an intruder would know that these are intercompany transactions. In that case, our recommendation is to first figure out what are those entries that you want from your consolidated trial balance for. Maybe 2025 or previous years that you want to catch up. Once you figure it out, you can perform one manual adjustment or maybe once a month manual adjustment for the last one year through a new manual elimination as a one-time catch-up process, so that you can catch up and proceed going forward.
Arti Patel Martinez: Thank you so much for that walkthrough! Such great stuff.
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