I’m working for a small distribution business, we have Dynamics NAV 4 installed. (minimum setup, no intercompany modules). We are upgrading to NAV 2018 in one year from now. In the meantime we need a solution for the following business scenario;.
We have one legal entity L1, trading in 5 branches B1, B2 to B5… B1 is also the warehouse. From Jan 2020 the business is splitting into 2 legal entities, will now have L1 (existing) and L2 (new). In NAV I have setup a new branch B6 for all business activity in the new company L2.
For L2 business (branch B6) we want to proceed as follows:
Sales order to customer ABC (customer is set to branch B6)
Product is sourced from warehouse B1 (as B6 has no warehouse and does not hold stock)
we did some test transactions and now have the Sales linked to S6 branch (Correct), however I now have a negative closing stock balance in S6. How do I get rid of this?
Ultimately what I want is a full Sales, Purchases for S6 so that I can do my VAT return.
Also P&L and Balance sheet by S6
Any advice on how best to do this in NAV 4 please.
Not sure of what you exactly mean with NAV 4 but a Help, About can give us the details to guide you the best.
As two companies are legal entities and closely linked to each others because of the Sales and Purchase part - You really need the Intercompany module if you want to “electrify the datastream” - And you need someone to do some development so you don’t have to do to manuel work with creating purchases and sales.
Generally:
I your legal Entitiy where you are having the Items in stock - You have to have the LE2 created as a customer to whom you sell your items to.
In LE2 you have to have LE1 as a VENDOR from where you buy your items, and then you have to have the Actual Customer whom is buying the products.
IF you in LE2 create a customer sales order (SO) - Then you need to take the Vendor Purchase report - and change it so it makes PO (Purchase Order) based on the demand - NAV version 4 cannot create POs automatically as far as i remember . If you use drop shipment then you need to do thet setup of that to.
Having the PO in LE2 you need to use Intercompany to transfer the PO to LE1 as a SO. You probably also need a developer to electrify this process too.
Depending of your knowledge are peparation and how much you want to have automated - This can probably be developed in one or two days using a skilled developer.
Notice thoug,h that your version is quite and and it can be hard to find person for that.
we are using a very old version of NAV, version 4.0, with basic functionality and does not have intercompany functionality. We don’t have a developer, and hence we want to avoid any development changes. Also this is an interim solution until we upgrade in one year’s time. Instead we are now looking to amend the configuration we have. I’ve new to NAV too!
I accept we will not be able to fully automate this scenario in the current configuration, and will have to manage and track some things off-system. Our minimum needs for NAV are been able to extract account balances for the new legal entity, ensuring we don’t impact the other entity, have Purchasing and Sales figures for the new entity so that we can do a VAT return, as well as have P&L and BS available.
I was thinking of 2 possible solutions:
setup a dummy branch for the intercompany eliminations, so that we can journal the intercompany transaction at month-end.
So we would have Branch B7 for these transactions as well as new branch B6.
or
create new posting group for new entity’s transactions. In particular, to NOT calculate closing stock (which will be negative) and have this in some suspense account?
would any of these work? any advice much appreciated
In order to do the illiminations as easy as possible I would definately do a new set of posting groups - this is also how it is done in NAV 2018 - so you will be aligned with the never version when you jump to that.
Secondly I would strongly suggest that you invest the 1000-1500 EUR in automating the typing of sales and purchases - the number of errors are normally quite high in this type of transactions - it is a small price to pay.