This article is relevant if you have NetSuite customer amounts due that combine values from accounts receivable and customers deposits.

Background

Most newcomers to the NetSuite platform with accounting background in other systems are somewhat surprised to learn that NetSuite does not have aging reports that will combine the Accounts Receivable and Customer Deposit balances together. It’s important for accountants that work with NetSuite to understand that the balance sheet is effectively dynamically calculated by summarizing all posting transactions from inception to the date or period in question by targeting the GL account as a control.

NetSuite’s provided Accounts Receivable report does not contemplate the Customer Deposit account. The built-in aging report ties out to the Accounts Receivable values on the balance sheet — the hallmark of conventional sub-ledger accounting control and explanation. However, this does not give us a true representation of customers’ real obligations. We must account for customer deposits.

Expertise in Customer Deposit Accounting

I am often invited by prospective customers to solve their revenue recognition practices. Many of these relate to receiving monies in advance before shipping produce and delivering services. The novice NetSuite administrator may use a Cash Sale transaction to attempt to capture funds paid by a customer — perhaps in an Electronic Commerce situation.  Accountants then have to do all kinds of reclass work because revenue is recognized before it is earned.

However, Customer Deposits represent a simple yet very powerful transaction to account for deferred revenue when an organization receives funds before they have earned them. I have written a number of articles on Customer Deposit accounting and effectively solved for requesting monies on Opportunities, Estimates, Sales Orders, and Projects and properly aging these as normal cash collection activities. If you have any number of Customer Deposits situations, I urge you to review these related articles:

1. Solved: NetSuite Customer Deposits and Advance Payment Accounting
2. Create NetSuite Customer Deposits from Opportunities or Estimates
3. Generate Customer Deposit Request Invoices on NetSuite Projects
4. Yes You Can: Generate a NetSuite Customer Statement on an Invoice with Customer Deposit Accounting
5. Using NetSuite Payment Methods to Drive Customer Deposits

NetSuite Accounts Receivable with Customer Deposit Aging

Since NetSuite Saved Search can effectively be used to faithfully explain all accounts on the balance sheet, it was time to finally solve the challenge for the NetSuite community. Similar to how I use Saved Search to produce a Trial Balance, I have designed an aging report that supports the following capacities:

1. Tie to the Balance Sheet: as always, when building saved search based financial reports, tie summary values to the balance sheet; else do not trust the information provided.
2. Age Transactions: take amounts and age them relative to today’s date. This allows you to see the older transaction elements that help collection activities.
3. Filter for Subsidiary, Currency, and End of Period: by default, work at the consolidated level. However, when needed, filter based on important dimensions that tie to specific subsidiaries, currencies, and end date/periods.
4. Find Unapplied Situations: while a customer’s position between net debits and credits may effectively be zero (meaning, the customer owes nothing), this does not mean that records have not been properly applied to each other. Thus, reveal the situation so that proper transaction clean efforts can be performed.
5. Aging Drill Down: naturally, NetSuite supports drill down. Hence, reveal the transactions that make up the balance to help with diagnostic analytical activities.

Request the NetSuite Aging Report

The aging report is available to all NetSuite customers without a license charge simply by making a request here. Please supply me with your NetSuite account number and I will provide you the bundle.  I have bundled this search with other helpful Financial Searches that solve common challenges in the NetSuite community.  This aging report is similar to the article I published “Calculate NetSuite Days Sales Outstanding (DSO) with Saved Search”  which the community has warmly received.

Note, just as we give you this bundle without a license charge, so is the same for all of our other algorithms and applications that are used to accelerate specific solutions. See our public-facing list here. We are different in that we use these bundles to act as accelerators in offering NetSuite expertise. Thus, the software artifacts are an illustration of our superior capacity to understand business concerns, invent with the NetSuite platform, and take care of client concerns. Our clients’ tell us that it is “a breath of fresh air” to work with highly competent Netsuite professionals.

If you found this article helpful, feel free to sign up to receive notification of newly published posts. Our ethic is to not solicit you. If you would like to request the Financial Saved Search Library bundle with the NetSuite Accounts Receivable Customer Deposit Aging, or discuss your specific NetSuite challenge, let’s have a conversation.

Marty Zigman

Holding all three official certifications, Marty is regarded as the top NetSuite expert and leads a team of senior professionals at Prolecto Resources, Inc. He is a former Deloitte & Touche CPA and has held CTO roles. For over 30 years, Marty has produced leadership in ERP, CRM and eCommerce business systems. Contact Marty to set up a conversation.

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