NetLease - Elimination Subsidiary
Overview
The Elimination Subsidiary feature allows a lease to designate a separate subsidiary into which all of its lease journals are automatically mirrored as reversing entries. This supports intercompany elimination, where activity recorded in the operating subsidiary must be offset in a designated elimination subsidiary so that consolidated financials present correctly.
When an elimination subsidiary is assigned to a lease, NetLease generates a paired reversal journal in that subsidiary for every applicable journal it creates - amortization(monthly), termination, and modification journals. Each elimination journal is flagged with NetLease Elimination Entry = T and its memo is suffixed with - ELIM REV so it can be readily identified.
Prerequisites
- The Elimination Subsidiary feature must be enabled in NetLease Global Settings.
- The NetSuite account must be a OneWorld account with more than one subsidiary.
- The lease must be a single-book lease in its base currency (see Limitations below).
How Elimination Journals Work
When the Elimination Subsidiary field is populated on a lease, each journal NetLease posts for that lease is paired with a reversal journal posted to the elimination subsidiary. The reversal journal:
- Copies the lines of the source journal with reversed debits and credits.
- Posts to the elimination subsidiary, not the lease subsidiary.
- Is flagged with NetLease Elimination Entry (
custbody_laa_elimination) = true. - Carries the source journal's memo with - ELIM REV appended.
- Mirrors the approval status of the source journal — if the source journal is pending approval, the elimination journal is created unapproved as well.
The following journal types generate paired elimination journals:
| Journal Type | Elimination Journal Generated |
| Amortization(monthly) | Yes |
| Termination | Yes |
| Modification | Yes |
| Transfer (reversal leg) | No |
| Reclass (ST/LT and custom reclass) | No |
When a termination, modification, or deletion reverses out a journal, NetLease also deletes the associated elimination journal and clears the Elimination Journal reference field on the schedule line.
Where the elimination journal is stored
Each elimination journal's internal ID is recorded on the schedule line in the Elimination Journal field. This field is only visible when the Elimination Subsidiary feature is enabled and a value is present.
Step-by-Step Process
Enable the feature
- Navigate to NetLease > NetLease Setup > System Setup.
- Under the System Features section, check the Elimination Subsidiary box.
- Click Save.
Once enabled, the Elimination Subsidiary field becomes available on the lease record, and the Elimination Journal field becomes visible on schedule lines. When the feature is disabled, both fields are hidden.
Assign an elimination subsidiary to a lease
- Open the lease record.
- Navigate to the Accounting subtab, in the Elimination Subsidiary field, select the subsidiary into which journals should be eliminated.
- When setting the field for the first time, a confirmation prompt appears: "Adding an elimination subsidiary will cause all future lease journals to be reversed into the elimination subsidiary. Are you sure you want to continue?" Click OK to proceed.
- Save the lease record.
All subsequent journals generated for the lease will produce a paired elimination journal in the selected subsidiary.
Confirmation prompt
The confirmation warning appears only when the field is first populated. It is a safeguard against unintentionally enabling intercompany elimination on a lease.
Considerations
- The elimination subsidiary applies to journals generated after it is set. Journals already posted before assigning the elimination subsidiary are not retroactively mirrored.
- Elimination journals are tied to their source journals. Reversing the source activity (termination reversal, modification reversal, or deleting the journal) removes the paired elimination journal automatically.
Limitations / Callouts
Subsidiary must differ from the lease subsidiary
The elimination subsidiary cannot be the same as the lease's subsidiary. If a matching subsidiary is selected, the field is cleared and the message "The elimination subsidiary must be different than the lease subsidiary." is displayed.
Not supported for Multi-Book leases
The Elimination Subsidiary feature is not supported on multi-book leases. If a secondary accounting book is set on the lease, the elimination subsidiary field is cleared with the message "The elimination subsidiary is not supported for multibook."
Not supported for FX leases
The feature is not yet supported on leases where the base currency differs from the contract currency. Selecting an elimination subsidiary on such a lease clears the field with the message "The elimination subsidiary is not yet supported for leases with a base currency different than the contract currency."
