Org hierarchy for one legal entity with few divisions

Finance and Operations/AX User Forum
1

Hi, we have a single legal entity (one currency US) with 4 divisions. Several departments (9) that intersect legal entity with divisions. We have set of ledger accounts identified that are available per department(s). The divisions are set up as AX Business Unit. we are thinking of the following account structure - balance sheet, income and Cogs and another one for expenses per department. We see that the financial dimensions are going to be department. It seems that we don’t need to create a financial dimension for Business unit from what we understand (since the department is a dimension).

We would like to know how to structure the organization - obviously Legal entity as a top hierarchy followed by Departments and then divisions or (Legal → Division → Dept). What we need to consider while creating org hierarchy? We also need to limit user access per department (or division). We are an SMB in a manufacturing (M-T-O) industry. Thank you

2

Hi

u can map above organisation structure as below

create legal entity->create a chart of account->create accounting structure with combhination of ledger account, division(business unit), deportment

siddu

3

Hello Siddu, thanks for your feedback. That’s what we are thinking. We would also like to add Customer Group and Item Groups. Will it make sense to add these as a dimensions to the main accounts (in the account structure) or could we create a separate dimension sets. Essentially we want to be able to pull the financial report that will show the statement summary/detail break-down by BU - Dept - Customer Group - Item Group.

there are about 7 departments that only share expense accounts among the 4 business units. The rest of the accounts including balance sheets and income accounts are only associated to the corporate (legal entity). So we have one department “Corp-dept” within Corporate office to which these accounts are linked. We wondering whether to create another unit say “Corporate BU” and associate these accounts to this BU and “Corp-Dept”?

Thanks

4

hi,

1st create a organisation structure by selecting business unit, deportment, cost center

2nd select this same in organisation structure in accounting structure->relationship option

3rd assign this accounting strucutre to chart of account

5

regarding “pulling the financial reports break down by customer group and item groups” - you should have the customer group and item group in the account structure.

only when you add them into the account strucure you would be able specify them during the transaction and thus can create the dimension sets as needed. So, i suggest you to have these in your account structure.

6

Thanks Santhosh. I thought, i could create dimension-set later on with just Ledger + BU+Dept dimensions in the accounting structure and that I don’t need to specify explicitly the customer and product dimensions as part of the accounting structure.

So, is the dimension-set a sub-set of the “dimensions set up in the accounting structure” ?

  1. If I go with BU+Dept+customer+product in the account structure, then do I need to specify all the dimensions in the transactions or can I omit say product?
7

Hi Siddu, i cann’t seem to create the org structure that we want. The reason being is that there is no 1: 1 or 1:M relationships exists strictly speaking between BU and Department here. BU1 through BU3 share about 5 departments for the Operations. ie. all of my Cog ledger account relate to these BUs and Dept

ie. COG account 4000 … 4999 is shared to BU1…BU2 which shared to Dep1…Dept 5.

rest of accounts from 1000…4000 & 5000…9000 only associated to Dept_Corp

How can I create a AX org structure based on this?

Under BU1 i will link Dept 1… Dept 5

for BU2, then Dept 1 through Dept 5 is not available to associate to. Likewise BU3?