Skip to main content

Notifications

Announcements

No record found.

News and Announcements icon
Community site session details

Community site session details

Session Id :
Dynamics 365 Community / Forums / Small and medium business | Business Central, N... / Consolidation
Small and medium business | Business Central, N...
Suggested answer

Consolidation

(1) ShareShare
ReportReport
Posted on by BZ-03050753-0 68
I have just created a new company in BC, How can I define it as a subsidiary company.
 
Also I need to get consolidation reports as financial consolidation so how can I link between The main company and this company.
Categories:
Dynamics 365 Business Central
Dynamics 365 Business Central
  • Suggested answer
    Valentin Castravet Profile Picture
    Valentin Castravet 26,349 Super User 2025 Season 1 on at
    Consolidation
    Please refrain from posting AI-generated answers. The response is not accurate and doesn't describe the functionality available in Business Central.
  • Suggested answer
    Saif Ali Sabri Profile Picture
    Saif Ali Sabri 789 Super User 2025 Season 1 on at
    Consolidation

    1. Setting Up the Subsidiary Company in Microsoft Dynamics:

    • Create the New Legal Entity:

      • Go to Organization administration > Organizations > Legal entities.
      • Select New to create a new company.
      • Fill in the details for your new company, such as name, company ID, address, and other relevant information.
      • Save the company as a legal entity.

    • Assign Ownership and Link to Parent Company:

      • In the legal entity setup, you can add relevant ownership details, indicating that this new company is a subsidiary of the main company.
      • Microsoft Dynamics doesn’t have a specific "subsidiary" label, but you’ll establish this connection through your organizational structure and financial reporting setup.

    • Define Reporting Currency:

      • Set the functional currency for the subsidiary, especially if the BC company operates in a different currency than the parent company.

    2. Configuring Intercompany Transactions:

    To handle transactions between the main company and the subsidiary:

    • Setup Intercompany Accounting:

      • Go to General ledger > Setup > Posting > Intercompany accounting.
      • Define the accounts that will be used for intercompany transactions between your main company and the subsidiary.
      • Set up intercompany accounts for receivables, payables, and other financial transactions.

    • Intercompany Sales and Purchases:

      • You can enable automatic creation of intercompany transactions between the main company and the subsidiary.
      • Use intercompany sales/purchase orders to record transactions between the two companies, ensuring proper elimination during consolidation.

    3. Setting Up Consolidation in Microsoft Dynamics:

    Once your subsidiary and parent company are both set up in Dynamics, you can prepare for consolidated financial reporting:

    • Create a Consolidation Company:

      • You can create a separate company within Dynamics specifically for consolidated financial reporting. This is often called a consolidation company.
      • Go to General ledger > Setup > Ledger > Consolidation and set up the consolidation company.

    • Configure the Consolidation Process:

      • Go to General ledger > Periodic > Consolidate > Consolidation.
      • Define the source companies (the parent and the subsidiary).
      • Choose the method of consolidation (such as by equity or by line-item).
      • Set up the consolidation currency, if different.
      • Map the chart of accounts between the parent and subsidiary to ensure proper alignment.

    • Eliminate Intercompany Balances:

      • In the consolidation setup, ensure you eliminate intercompany payables/receivables and other balances that occur between the companies.

    4. Generate Consolidated Financial Reports:

    Once everything is set up:

    • Go to General ledger > Inquiries and reports > Financial statements to generate consolidated financial statements.

      • You can create balance sheets, income statements, and other reports based on the consolidated financial data.
      • Dynamics will pull the financial data from both the parent company and the subsidiary, and automatically apply consolidation rules, including intercompany eliminations.

    • Use Financial Reporting Tools:

      • Microsoft Dynamics 365 includes built-in financial reporting tools like Financial Reporter (also known as Management Reporter) to design and generate consolidated reports.
  • Suggested answer
    Valentin Castravet Profile Picture
    Valentin Castravet 26,349 Super User 2025 Season 1 on at
    Consolidation
    In your parent company you set up business units. Each business unit is tied to a subsidiary company. That's where you do the set up. You don't do the set up in the subsidiary company. 
     
  • Suggested answer
    Jun Wang Profile Picture
    Jun Wang 7,604 Super User 2025 Season 1 on at
    Consolidation
    hope this could help
     
     
  • gdrenteria Profile Picture
    gdrenteria 14,573 Most Valuable Professional on at
    Consolidation

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

Daivat Vartak – Community Spotlight

We are honored to recognize Daivat Vartak as our March 2025 Community…

Announcing Our 2025 Season 1 Super Users!

A new season of Super Users has arrived, and we are so grateful for the daily…

Kudos to the February Top 10 Community Stars!

Thanks for all your good work in the Community!

Leaderboard

#1
André Arnaud de Calavon Profile Picture

André Arnaud de Cal... 292,516 Super User 2025 Season 1

#2
Martin Dráb Profile Picture

Martin Dráb 231,409 Most Valuable Professional

#3
nmaenpaa Profile Picture

nmaenpaa 101,156

Leaderboard

Featured topics

Product updates

Dynamics 365 release plans