If you have more than one company in your group, Microsoft Dynamics 365 Business Central requires you to set up a separate company for each legal entity. If you have 5 companies in your group, then you will have to set up 5 companies in Business Central, each with their own chart of accounts, vendors, customers, banks and other setup tables. You may start out with the same chart of accounts in each company, but it is very difficult to keep the separate chart of accounts in sync and over a period of time they will become different. The same thing happens to vendor tables – they eventually become different making it difficult to create reports of total purchasing by vendor.
The Multi Entity Control allows you to set up one company within Business Central and use a dimension to identify the legal entity.
As an example, if a customer has 5 separate companies, instead of creating 5 companies within Business Central we only need to create one company and use the Entity dimension for reporting on each separate company.
Keeping separate “companies” or entities within one company in Business Central will allow the implementation of one chart of accounts, one vendor list and one customer list to be used instead of multiple sets of tables. The problem with having multiple vendor tables, for example, is that the same vendor in each of the multiple tables needs to have the same vendor number so you can keep the vendors clean and report on purchases for the same vendor. Over a period of time, the vendor list will typically become out of sync and duplicate vendors may be created. Having only one vendor table to manage makes the system cleaner and easier to maintain. The same comments apply to the chart of accounts and customer tables.
Entries will be posted into Business Central into the General Ledger and may be posted to more than one Entity code. For example, a purchase invoice is posted to a vendor using entity A and the expense is posted to entity B. The purchase invoice will be posted as normal. The Multi Entity Control will be triggered by the posting process and will check to make sure the entry balances by each Entity code.
Watch a video demonstration of how this application can be used.
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