A company’s general ledger (GL) forms the basis of all its reporting. Not only does it track all income and expense transactions tied to your business, in one place, but it also serves as the summary that feeds all other financial statements.
Within a general ledger, transactional data is organized into assets, liabilities, revenues, expenses, and owner’s equity; which offers you a categorized view of the financial position of your business.
Netsuite accounting software offers comprehensive GL functionality, to help you gain a high-level overview of your business finances. This is an important part of managing your money efficiently and forms the basis of budget reporting within a business.
What is budget reporting?
A budget report allows your business to compare its spending over a set period against its estimated projections for that time. This would allow business owners to assess and establish if they stayed within the set limitations for funding for specific purposes, or if they have overspent on targets set. Because overspending does not always mean that someone needs to be wrapped over the knuckles, a budget report holds great value to those who view it, because it may be an indicator that your planning projections need alteration or more thorough investigation, before it is compiled.
How NetSuite’s GL aids budget reporting
NetSuite’s GL automates core accounting processes with its structure being based on a multi-dimensional chart of accounts. This means that within the GL, you can customize account types, transactions and reporting segments to meet unique business requirements, while also pull reports directly from categories created within your GL.
NetSuite’s chart of accounts, that can be extracted from the GL function within this software, encourages a more granular view of transactions within a business, which allows for a more detailed budgeting process. Meaning that while you can track and compare expenses against your budget forecasting for that period, you can also delve deeper into why your projections may have been off and adjust business planning accordingly.
The chart of accounts also aids businesses to generate up-to-date variance reports, which show businesses where projected budgets track in relation to actual spending, making it easier for you to make informed decisions and redirect budgets as it happens.
It is important for business owners to have the whole view of their expenses and continually make adjustments to their budget goals as part of their growth strategy. Looking at the numbers should never just be reactive or done at times when tax submissions are due to the IRS. A healthy business should constantly stay abreast of the needs of their business by becoming acquainted with the data and then using it to their advantage.
Why NetSuite’s GL function is beneficial for budget reporting:
- NetSuite’s GL can automatically generate and update budget reports as transactions happen, with the software’s real-time functionality.
- It makes it easier to allocate resources where a business needs it most.
- It makes it easier to track the actual spending within a business against the projected budget – this is an important part of keeping your bottom line within a healthy range for business continuity.
- It makes it easier for businesses to establish an effective cost-reduction strategy.
- It helps businesses identify potential issues before they become major problems.
Getting budget reporting right is an important part of a business growth strategy. Leveraging NetSuite’s GL structure can offer businesses sound insight into their financial performance and allow them to make business-saving decisions.
We can help you set up your GL and budget strategy within NetSuite. Our NetSuite Outsourced Controllers are skilled at software integration and can offer your business the peace of mind it needs to run its accounting accurately and independently.
_______________________________________________________
This blog article is not intended to be the rendering of legal, accounting, tax advice or other professional services. Articles are based on current or proposed tax rules at the time they are written and older posts are not updated for tax rule changes. We expressly disclaim all liability in regard to actions taken or not taken based on the contents of this blog as well as the use or interpretation of this information. Information provided on this website is not all-inclusive and such information should not be relied upon as being all-inclusive.
