Legal Units and Sub-units
As an alternative to use extended dimensions for operative
purposes, you can define a company structure, which you divide into
company sub-units, representing business units, for example geographical
areas or other management perspectives. A group company representing the
actual company and subsidiaries representing the business units
can be defined for this purpose, but note that eliminations of investments
in subsidiaries will not work properly. The acquisition values have
to be entered on one of the subsidiaries making eliminations occur
on the group level, which represents the company. An alternative
is to use legal units and sub-units. Acquisition values can be stored
and calculated on a legal unit, as if it was an ordinary subsidiary,
which means that the elimination of investments will be handled
correctly.
Define Legal Unit and Sub-units
To use operative units in the company structure, make the following definitions:
- Define the legal company as if it was an ordinary subsidiary or parent company, but instead of selecting subsidiary as company type, select Group and Legal Unit.
- Connect the legal unit to the group company with the same percentage as if it would have been an ordinary subsidiary or parent company.
- Define the sub-units representing the operative units with company type Subsidiary. When you connect the unit to the legal unit it will be saved as company type subsidiary - sub-unit.
Legal Company Structures
In a legal company structure the legal unit represents a legal company. Period data is entered on sub-units and consolidated into the legal unit, where the legal unit will have period values representing the legal company. The sub-units are parts of the legal company not owned by any other party, and therefore no investment eliminations are made on them. Instead shareholdings and investments are stored on the legal unit, like for any other subsidiary.