Going Global With Sage Accpac ERP
Today, many organizations are expanding into new markets to take advantage of economical global supply chains, diversify to stabilize cash flow, or to create an organization more appealing to investors. If your organization is expanding, you may be facing a number of operational challenges. You will need to consider the localization requirements of language, business and tax rules; managing transactions in multiple currencies; processing transactions between companies; and producing consolidated financial reporting from disparate entities. We will look at each of these issues in turn and discuss the tool.
When operating in different countries, software systems must provide the user interface and data in the local language. Every country varies in its accounting standards such as reconciliation and taxation. Sage ERP Accpac offers country-specific layers or packs that allow you to provide local language, tax, and accounting rules through seamless default settings and templates.
Having multiple locations around the world or simply dealing with customers and suppliers in different countries requires that you enter and process transactions in multiple currencies and keep track of constantly changing exchange rates.
The Sage ERP Accpac Multi-Currency module handles the complexities of dealing with multiple currencies with ease. You can create and maintain an unlimited number of currencies and exchange rates. Transactions can be entered in any currency and reports can be produced in both your home currency and the currency of your vendor or customer. Seamless integration across financial and distribution modules ensure currency gain or loss is automatically calculated to reflect currency fluctuation as transactions are settled.
An intercompany transaction occurs when a subsidiary is involved in a transaction with headquarters or another subsidiary. Examples of intercompany transactions include the declaration and payment of dividends, the purchase and sale of assets, and borrowing and lending.
The intercompany transaction must be recognized in the financial records of both units of the entity as if it were a transaction with an unrelated party. Sage ERP Accpac allows you to enter transactions that affect more than one company in one account, and then automatically distribute those transactions across companies, performing required currency translations and creating the necessary journal entry as soon as transactions are posted, balancing the books of both companies.
Local And Consolidated Reporting
When it comes to financial reporting, multi-national companies face a two-prong challenge. Each division or subsidiary must pay its employees, manage accounts receivable and accounts payable and pay taxes in the local currency using local accounting standards. Yet financial data from subsidiaries also must be consolidated into the ledger of record in the monetary unit and accounting standards of the country in which the corporation as a whole is operated. Exchange rates between currencies change constantly and the ledger of record must reflect these changes, and ensure that all entries balance.
With the multi-national capabilities of Sage ERP Accpac and the Multi-Currency module, you easily can comply with the international currency standard. The Multi-Currency module uses international principles for accounting and reporting with adherence to FASB-52 and IAS 125 guidelines.
If your organization is expanding, either globally or into new locations nationally, give us a call for assistance in leveraging the multi-national capabilities of Sage ERP Accpac.