web
You’re offline. This is a read only version of the page.
close
Skip to main content

Announcements

No record found.

News and Announcements icon
Community site session details

Community site session details

Session Id :
Dynamics 365 Community / Forums / Microsoft Dynamics GP (Archived) / multiple legal entitie...
Microsoft Dynamics GP (Archived)

multiple legal entities - one company in GP?

(0) ShareShare
ReportReport
Posted on by iruser 527

Hi folks

 

I have several legal entities that have the same functional and reporting currencies.  Each legal entity will need its own balance sheet, containing an a/r and an a/p.

 

If I use the intercompany I know I can set up the due to due from to keep the balance sheets balanced.

 

I believe I can use intercompany to define which users can see which company.

 

When a payment is allocated to invoices after the payment is posted, I know that no JE is made, as the a/r is not really changing; that is unless of course you have more than one legal enttiy within the GP company, and have more than one a/r account in which case the payment may be in one a/r and the invoice in the other.  Would due to due from kick in to correct this?

Can I have more than one a/p account and more than one a/r account and still have the system generate the required transactions to maintain the two balance sheets as balanced?

 

thanks!

 

Ian

*This post is locked for comments

I have the same question (0)
  • Community Member Profile Picture
    Community Member on at

    Hi iruser,

    The application of cash against an invoice can actually generate Journal Entries. The most common is Foreign Exchange gains and losses - but if an amount is written off at time of applying, then this will also generate a JE.

    The short answer to your question is, yes, you can generally do what you want. But I would think long and hard about it...and consider using seperate databases and the GP multicompany reports maybe?

    You can have more than one GL AR Account, and this is not a problem. One set of customers (maybe grouped by Class ID - can use one AR account - another group can use another etc). But if all of your AR is within the one company database, there isn't functionality to track 'intercompany' balances if you apply cash that was posted to one GL account against an invoice that was posted in another. GP doesn't care - it will calculate the distributions when you perform the apply or posting action.

    Its a complicated issue with pro's and cons on both sides. There are legal implications. If the companies are seperate legal entities - then should you be maintaining them in a single database? Do you  have VAT / Sales Tax returns to worry about etc.

    Over the years, I have converted a number of customers from single combined database to individual company databases - there is a lot of pain in doing this - but they had greater pain when the companies were combined in a single database. What seemed like a good idea at the time turned out to be a nightmare. But, without knowing the detail, its very hard to advise more.

    Best regards,

    Ian.

  • iruser Profile Picture
    iruser 527 on at

    HI Ian

    thanks for the information.  Yes; I knew about the application of funds as you describe it hence my question.

    We are a multinational.  I'm going to need three companies, US, China, and Canada.  Canada is not too bad as there is only one legal entity.  In the US however there are at least 5.  Counting a corporate company I think i am up to nine companies / databases.  Which seems a lot when the currency is not changing, hence my consideration of the intercompany GP feature.

    I think the long and hard you talk about is leading me to lots of companies / dbases.

    I have installed for single databases as well both as a consultant and as a user  I have seen it work and not work.  The decider i think is the need for multiple balance sheets and the payment application process.  that is going to force my hand to needing to have multiple companies.  

    Boy am I going to miss the pervasive days where you could copy the table files from one company to another tp copy similar set up aspects; All vendors, customers, gl accounts etc being the same.

    thanks again for the advice.

  • Community Member Profile Picture
    Community Member on at

    Hi,

    There is a feature in the Professional Services Tools Library for GP 2010 for copying company set up and master data from one company to another. You can define what areas you need copied - generally by series / module.

    Prior to GP 2010, there is a tool called the Copy Company Utility that you can use to copy data between companies.

    One other thing - to use the Intercompany functionality - it is intended for use between seperate company databases - not within the same company database.

    My only other observation is that my starting point would be seperate companies, unless someone can convince me that combined data is 1. Necessary, 2. There is no other option and 3. The strict paramaters from day one will not change (ie. This set of customers will always post to a certain GL account / we will not mix invoices and payments for different 'companies' in the one database etc.

    Question: Will the Canadian and China companies use USD? or will they be other currencies? Was it part of your investigation to combine China, Canada etc in one database? If so - you will face severe multicurrency issues - especially from a statutory financial reporting perspective.

    Best regards,

    Ian.

  • iruser Profile Picture
    iruser 527 on at

    hi Ian

    The Canadian company will have a functional and reporting currency of Canadian, and the Chinese will have Chinese, so they HAVE to have a seperate company than the US company.

    I agree with you the companies with the same reporting and functional currencies need to be seperate because of the posting issues on payments from customers and the payments to vendors.  The balance sheet.  Each seperate legal entity needs a balance sheet and therefore its own GP company.   Unfortunately this means we are going to have over 9 companies.  A pain when one customer sends once cheque that will be for multiple companies.

    thanks again for the advice.

  • Community Member Profile Picture
    Community Member on at

    Understood. Yes - a pain.

    But the reality of these transactions should be recorded. Company A receives money on behalf of company B. Company A must lodge this money to their bank account and then pay the money across to company B. Company B must record this receipt and then apply it against the outstanding debt.

    You could make life easier by combining these companies within one database - but is this strictly correct? They are seperate legal entities. I think your approach to have seperate companies is the correct approach and will save you a tonne of pain in the future. Also, your auditors will find it a lot easier to follow. If the companies are combined...there will definately be audit queries as long as your arm!!

    Best of luck with it.

    Ian.

  • michelle brayton Profile Picture
    michelle brayton 95 on at

    There is a way to utilize intercompany within the same database, however, it is called interfund.  It is generally utilized for fund accounting purposes, however, I have implemented it to track the due to/ due from for separate legal entities in the same database.    You are only allowed to have one account designated as the due/to(from) account instead of two as with Intercompany.  It also requires that you have a segment of the COA that uniquely identifies the legal entity.  Each customer would need to be utilized for a specific legal entity if separate A/R accounts are to be maintained and each should be assigned to a customer class so the Aging reports can be printed by legal entity to tie to the representative control account.  The same would apply to Vendors.

    Alternatively, if you were to have separate databases and have the issue of receiving one payment from a customer that crosses databases, Nolan computers has an intercompany product that allows for cash receipts to be entered in one database and applied across to others.  The prerequisite is that the customer id be the same in all of the databases.

    Michelle

  • Suggested answer
    Frank Hamelly | MVP, MCP, CSA Profile Picture
    Frank Hamelly | MVP... 46,627 Moderator on at

    To throw one other possible option in here - you might want to look at Binary Stream's Multi-Entity processing.  It makes possible multiple legal entities in one database, with intercompany functionality.

Under review

Thank you for your reply! To ensure a great experience for everyone, your content is awaiting approval by our Community Managers. Please check back later.

Helpful resources

Quick Links

Introducing the 2026 Season 1 community Super Users

Congratulations to our 2026 Super Stars!

Congratulations to our 2025 Community Spotlights

Thanks to all of our 2025 Community Spotlight stars!

Congratulations to the February Top 10 Community Leaders

These are the community rock stars!

Leaderboard > 🔒一 Microsoft Dynamics GP (Archived)

Last 30 days Overall leaderboard

Featured topics

Product updates

Dynamics 365 release plans