Planning for Multi-Book Accounting

Full Multi-Book Accounting supports a maximum of five active accounting books including the primary book. You can add as many as four active secondary accounting books that use a different chart of accounts, currency, accounting rules, or a combination.

In addition to the five active accounting books, you may have pending and inactive secondary accounting books. Transactions cannot be posted to inactive accounting books, but you can produce reports that show historical transactions posted before the accounting book was inactivated.

To determine how many secondary accounting books you need, consider the following questions:

• What currencies do you want to use to track accounting records, in addition to the base currency for your company or each subsidiary?

• Do you want to have different charts of accounts for different accounting books? If so, what accounts do you need to add, and how do they relate to the accounts in the chart of accounts for your primary accounting book?

• Do you need to use different accounting rules for revenue recognition, expense amortization, and fixed asset depreciation in different account books?

General Rules for Accounting Books and Subsidiaries

The relationship of subsidiaries and accounting books is complex. The following are general rules for accounting books and subsidiaries.

• Each subsidiary has an active primary book with the base currency for the subsidiary. This is automatic. The primary book cannot be made inactive.

• When you select a parent subsidiary for an accounting book and save the record, all child subsidiaries of this parent node are also selected. The box labeled Include Children is always checked and disabled as a visual reminder of this rule.

  

  As shown in the diagram above, when you select the subsidiaries Americas and Europe for the secondary book, all child subsidiaries under them are included.

  Some additional restrictions apply to accounting books and subsidiaries:

• If you are using the Foreign Currency Management feature for Multi-Book Accounting, the base currency for the accounting book must be defined for each associated subsidiary.

• You cannot remove a subsidiary from an active accounting book.

• Subsidiaries must be inactive to add them to active accounting books. When the Full Multi-Book Accounting feature is enabled, all new subsidiaries save with the Subsidiary is Inactive box checked.

  Subsidiaries that have transactions cannot be added even when inactive. For details, see Adding a New Subsidiary to an Active Book.

General Notices