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Consolidations - processing elimination rules for intercompany

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Posted on by Lucas Bournon

Hi all,

We are using D365 Finance and Operations. We are trying to setup elimination rules in the consolidations module for intercompany transactions.

Background:
We have a Canadian entity (operating in CAD) and a USA entity (operating in USD). A separate consolidation entity is setup and operating in Canadian dollars as that is the currency we want to report in.

Daily intercompany transactions happen as product is being shipped directly from our Canadian entity to our USA entity's customers. The intercompany invoices are always in USD. The intercompany transactions in our Canadian entity are translated to their applicable Canadian dollar value at the end of every month through foreign currency revaluation.

Objective:
We want to eliminate intercompany sales and intercompany trade receivables and payables. We expect the elimination entries to do the following:

Debit Sales, Credit COGS (to eliminate intercompany sales)
Debit A/P, Credit A/R (to eliminate intercompany trade receivables and payables)

Problem:
The elimination rules do not execute as we expected. In the screenshot below, we have specified the source account of 40000 (sales) and our intercompany dimension has been specified in source dimensions. However, when this elimination rule is executed, the journal is out of balance. The intercompany sales are pulled into the journal but there is no offsetting credit to COGS (account # 50000). How do we specify the offsetting entry for this rule?

Thanks in advance,

Lucas

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Dynamics 365 Finance

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Abhilash Warrier 5,402 Super User 2025 Season 2 on at

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Hi,

Could you first try testing in Sandbox with 1-2 intercompany entries for Originating & Destination company, and run the Consolidation & Elimination process. This can help figure out why the journal is out of balance.

Would appreciate if you could provide more information -

1. How is the process executed? Consolidate Online or Consolidation with import

2. Are you posting the elimination using the consolidation online process or running the Elimination proposal manually from the Elimination journal.?

3. Screenshot of the Setups.

4, Did you tried posting the Elimination journal with a balancing entry manually?

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Arvind Bharti 686 Super User 2025 Season 2 on at

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HI,

On elimination rule you need to specify all the main accounts which you would like to eliminate e.g. COGS 5000 in your case then system will pull balances from all the accounts setup (Net changes) based on type you have on your screen

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