How To: Allocate overheads and depreciation between subsidiaries, regions or branches

Here is how to to spread costs from the Head Office amongst subsidiaries, regions or branches when using Consolidations.

1. In the Head Office forecast, create a cost record and select the As % of Costs record. Allocate the percentage of the overheads to a subsidiary by selecting the overheads to be be divided and entering the percentage.

2. Then create a Fixed Asset record and enter a depreciation charge that needs to be transferred to the other subsidiaries.

3. Create a Memo record and use the Purchase Invoice method. Select the Cost record created in Step 1.

4. And create another Memo Record using the Depreciation method and select the depreciation record created in Step 2.

5. Then, in the subsidiaries, create a Memo record for both the cost and depreciation records to match the Head Office.

Select the Hotlink method. Then the Hotlink Type will be Forecast.

Note: this will need to be done for each subsidiary.

6. Then select the matching records created in Step 3 & 4. Note: you will need to link one memo record at a time.

7. In the subsidiary forecast, create a Cost record and select As % of Memo as the method.

Enter the percent for that subsidiary and select the Memo record created in Step 5.

Do this for both depreciation and cost.

8. Once you have completed these steps, you will see the amount taken from the Head Office and distributed amount the subsidiaries. 

9. Once you have completed the consolidation, you will see the allocations on the P&L:

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