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Dynamics 365 Community / Forums / Microsoft Dynamics AX (Archived) / Defining a legal entit...
Microsoft Dynamics AX (Archived)

Defining a legal entity to be used for financial consolidation process when ledger records exist

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Posted on by Community Member

Hi,

I have a customer that recently took over a subsidiary that he now wants to be able to consolidate in AX. In order to do that the consolidation company needs to be defined (a check box in setup for Legal entities in GL) but I get a warning message saying that I "cannot change the consolidation company option as ledger records exist for the company".

If I understand it correctly this means that a subsidiary can't be added to an existing legal entity that has transactions, but must be created at the same time ..?

I would appreciate if anyone could help :)

Gugga

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  • Verified answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at

    Hi Gugga,

    I assume that the new company that was acquired tracks all transactions in AX. This company is not your consolidation company. Because you record transactions for this company in AX you can't activate the consolidation company parameter.

    What you need to do is setting up a completely new "consolidation company" - if you have not already done that. Note that you can't record any manual transaction in this consolidation company e.g. through GL journals. If only one single transaction has been created manually in your consolidation company you can't activate the parameter later on. You should actually activate the consolidation parameter at the time you setup this company. Would be great if you should tell us a bit more what happened to your consolidation company that this message was triggered.

    Thanks

    Ludwig

  • Community Member Profile Picture
    Community Member on at

    Hi Ludwig,

    And thanks for a prompt reply. The thing with my customer in this case is that the parent company has done it's transactions for many years in AX but the subsidiary is new in AX. There are only these two legal entities in this group. So you're saying that I should add a third legal entity, the consolidation company, that would only be artificial?

    Thank you,

    Gugga

  • Verified answer
    Ludwig Reinhard Profile Picture
    Ludwig Reinhard Microsoft Employee on at

    Hello Gugga,

    You have two possibilities in this case; (a) you setup a completely new "artificial" consolidation company that AX needs for consolidation purposes. You cannot use your current company as you have already recorded transactions there and can thus not activate the consolidation Parameter or (b) you make a system adjustment that would allow you specifying your current company as the consolidation company. I have seen some companies using option (b) but would not recommend that.

    If you need more Information on consolidations in AX, please have a look at the following sites:

    technet.microsoft.com/.../aa549110.aspx

    technet.microsoft.com/.../gg231815.aspx

    Please note that you can also do consolidations in Management Reporter. Management Reporter does not require that you setup a new "artificial" company. The only / Major disadvantage is that Management Reporter cannot create any vouchers. For Details please check out the following MS blog: blogs.msdn.microsoft.com/.../consolidations

    Hope this helps,

    Ludwig

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