Some organizations use Business Central in multiple business units or legal entities. Others use Business Central in subsidiaries that must report into parent organizations. Business Central gives accountants tools that help them transfer general ledger entries from two or more companies (subsidiaries) into a consolidated company.

Each company involved in a consolidation is called a business unit. The company in which you combine the data is called the consolidated company.

You can transfer financial data from subsidiaries to the consolidated company, even if the subsidiaries use Business Central in different environments.

If the financial statements of a business unit use a different currency than the consolidated company, you must set up exchange rates for consolidation.

You can consolidate:

• Across companies that have different charts of accounts.

• Companies that use different fiscal years and different currencies.

• Either the full amount or a percentage of a company's financial information.

• Using different currency exchange rates in individual G/L accounts.

• Companies in other accounting and business management programs.

• Companies in different Business Central environments.

You set up the consolidated company in the same way that you set up other companies. The chart of accounts is independent of the chart of accounts in the business units. The chart of accounts in the business units can differ from one another.

Set Up Company Consolidation

Before you can consolidate the general ledger entries of two or more companies (subsidiaries) into a consolidated company, you must prepare the charts of accounts and the consolidation company.

Depending on the complexity of your businesses, there are two ways to set up consolidation:

• If you don't need advanced settings, such as including a company that you only own part of, you can use the Company Consolidation setup guide to quickly set up a consolidation. The guide helps you through the basic steps.

• If you need more advanced settings, you can set up the consolidated company and business units yourself.

  • In each business unit, specify the general ledger accounts to include in the consolidation and the translation method for each account.

  • In the consolidated company, set up a business unit card for each company to include in the consolidation. The business unit card includes information such as the dates of the business unit's fiscal year, and the percentage of each account to include in the consolidation.

Simple consolidation setup

If your consolidation is straightforward, for example because you wholly own the business units to consolidate, the Company Consolidation guide will help you through the following steps:

• Create a new consolidated company, or consolidate a company you've already created. The company shouldn't contain transactions.

• Preview the results. Business Central verifies that you can successfully transfer the master data and transactions to the consolidated company.

To use the assisted setup guide, follow these steps:

1. Choose the search icon, enter Assisted Setup, and then choose the related link.

2. Choose Process Consolidations, and then complete each step in the Company Consolidation assisted setup guide.

Advanced consolidation setup

If you need more advanced settings for your consolidation, you can set up consolidation manually. For example, if you have companies that you partially own, or you have companies that you don't want to include.

Set up the consolidated company

First, you must set up the consolidated company. You set up the consolidated company in the same way that you set up other companies.

The following list illustrates key aspects of the consolidated company.

1. Set up the chart of accounts.

   The charts of accounts can be identical across a business unit and the consolidated company, or the consolidated company can have a different chart of account. If a business unit's chart of accounts differs from the consolidated company's, you must map the accounts to the accounts in the business unit.

2. Add business units.

   To consolidate several companies' data, you must set up the subsidiaries as business units and specify how much of their balances to include.

3. Specify exchange rates, if needed.

   Specify exchange rates if you'll consolidate data for business units that use different currencies. The three exchange rates you can use are Average Rate (Manual), Closing Rate, and Last Closing Rate.

4. Consolidate dimension information and general ledger accounts.

Add business units

In the consolidated company, set up each company that you want to consolidate data from as a business unit. Before you run a consolidation and generate your consolidation report, it's a good idea to verify the financial data in each business unit.

A big part of setting up the business unit is to specify how the unit will share it's financial data with the consolidated company. There are manual and automated options:

• To use a manual process, for Business Central online and on-premises, you can export an .xml file that contains the unit's general ledger entries. Then import the file in the consolidated company.

• To automate the data exchange, for Business Central online you can use an API that Business Central provides to share data across environments. If your companies are in the same environment, you can use the Database option.

1. Sign in to the consolidated company.

2. Choose the search icon, enter Business Units, and then choose the related link.

3. Choose New, and then fill in the required fields on the General and G/L Accounts FastTabs. Hover over a field to read a short description.

    

4. On the Data Import FastTab, in the Default Data Import field, specify how you'll share general ledger entries with the consolidated company:

   • To share data between companies in the same environment, choose Database.

   • To share data between companies in different environments, choose API, and then fill in the API's Endpoint field.

     To get the endpoint URL, in the business unit company's Business Central, open the Business Unit Card page and choose the Setup action.

   • To export an .xml file and manually share it, choose File Format.

Prepare general ledger accounts for consolidation

The chart of accounts for a company that will be consolidated must specify accounts for consolidation. For each posting general ledger account in each company, you must specify the general ledger account in the consolidated company to transfer the balance to. This mapping lets you consolidate companies that have different charts of accounts.

If the chart of accounts in the business unit differs from the consolidated company, you must prepare general ledger accounts for consolidation. You can specify the accounts to post debits and credits to, and the method to use to translate currencies in the consolidated company.

1. In each business unit's Business Central, choose the search icon, enter Chart of Accounts, and then choose the related link.

2. Open the card for the account, and then fill in the fields on the Consolidation FastTab. Hover over a field to read a short description.

Specify exchange rates for consolidations

If a business unit uses a different currency than the consolidated company, you must specify exchange rate methods for each account before you consolidate. For each account, the content of the Consol. Translation Method field determines the exchange rate. In the consolidated company, on each business unit card, in the Currency Exchange Rate Table field, you specify whether consolidation will use exchange rates from the business unit or the consolidated company. If you use exchange rates from the consolidated company, you can change the exchange rates for a business unit. For business units, if the Currency Exchange Rate Table field on the business unit card contains Local, you can change the exchange rate from the business unit card. The exchange rates are copied from the Currency Exchange Rate table, but you can change them before consolidating.

The following table describes the exchange rate methods you can use for accounts.

To specify exchange rates for business units, follow these steps:

1. Choose the search icon, enter Business Units, and then choose the related link.

2. On the Business Unit List page, choose the business unit, and then choose the Average Rate (Manual) action.

3. On the Change Exchange Rate page, the contents of the Relational Exch. Rate field have been copied from the Currency Exchange Rate table, but you can modify them. Close the page.

4. Choose the Closing Rate action.

5. In the Relational Exch. Rate Amount field, enter the exchange rate.

Include or exclude dimensions

You can consolidate dimension information and general ledger accounts.

• On the dimensions, specify the Consolidation Code field, or leave it blank.

  • To exclude a dimension in the consolidation, leave the Consolidation Code field blank on the dimension, and don't choose dimensions in the Copy Dimensions fields in any consolidation functions or reports.

  • To include dimension information in the consolidation, leave the Consolidation Code field blank. However, the consolidation will only work if the dimension values in the business unit are the same as the consolidated company.

  • To consolidate the dimension value code in the business unit with a different dimension value code in the consolidated company, fill in the Consolidation Code field on the dimensions.

• Add the dimensions to the general ledger accounts.

Exclude a company from consolidation

If you don't want to include a business unit in the consolidation, you can exclude it. To do that, go to the business unit card, and clear the Consolidate checkbox.

Include a partially owned company in consolidation

If you own only part of a company, you can include a percentage of each transaction that reflects the percentage you own. For example, if you own 70% of the company, consolidation includes $70 of an invoice for $100. To specify the percentage of the company you own, go to the business unit card and enter the percentage in the Consolidation % field.

Consolidate data

Before you consolidate, it's a good idea to test your data before you transfer it to the consolidated company. Business Central looks for differences in the information in the business units and the consolidated company. For example, whether account numbers or dimension codes are different. Correct any errors you find before you run the report. You can test the database or, if you're importing data from an XML file, the file.

Test the data before you consolidate

1. Open the consolidated company.

2. Choose the search icon, enter Business Units, and then choose the related link.

3. Test the file and database, as follows:

   • To test a file, choose the Test File action, enter the name of the file to test, and then choose Print.

   • To test the database, choose Test Database.

Run the consolidation

After you've tested the data, you can transfer it to the consolidated company. An assisted setup guide will help you through the process.

1. Sign in to the consolidated company.

2. On the Business Units page, choose the Consolidate action.

3. Fill in the required fields.

Use the Consolidated Trial Balance report

The Consolidated Trial Balance report can give you an overview of the overall financial health of your business. The report combines general ledger entries from each of your companies in a new company that you created for the consolidated data. The consolidated company is just a container for the consolidated data, and doesn't have any live business data. The companies that you include in the consolidated company become Business Units in the report. If you have four business units or fewer, you can also use the Consolidated Trial Balance (4) report.

The report shows a line for each account, and follows the structure of the chart of accounts. An account isn't shown if all the amounts on the line are 0. The report shows the following information for each account:

• The account number and the name of the account.

• The totals for the consolidated company and for each business unit. Totals can display either as a net change or the balance to date.

• The eliminations made in the consolidated company. Eliminations always show for a period corresponding to the consolidated company's fiscal year.

• The total for the consolidated company after the eliminations show either as a net change or the balance to date.

Eliminate repeated transactions

After you consolidate the companies, you must find and eliminate any transactions that are recorded more than once across companies. Processing consolidation eliminations is a manual process.

To eliminate repeated transactions:

1. Find transactions that might need to be adjusted, and enter general journal lines to eliminate them.

2. Run the G/L Consolidation Eliminations report to help you assess the effect of the general journal lines before posting.

3. Post the adjusting transactions.

The G/L Consolidation Eliminations report displays a tentative trial balance where you can simulate the consequences of eliminating entries. The report compares the entries in the consolidated company with the eliminations entered in the general journal.

Before you can include a business unit in the report, you must set up the unit on the Business Units page. Make sure to turn on the Consolidate toggle.

A line is created for each account, following the structure of the chart of accounts. An account isn't shown if all amounts on the line are 0. The report shows the following information for each account:

• Account number.

• Account name.

• If you selected one or more business unit codes in the Business Unit Code field on the request page, a total shown for the consolidated company excludes the selected business units and eliminations. If you didn't fill in Business Unit Code field, the total for the consolidated company excludes eliminations.

• If you selected a business unit code in the Business Unit Code field on the request page, a total shows for the imported entries from the business unit. If you didn't fill in the Business Unit Code field, a total shows for the posted eliminations in the consolidated company.

• The total for the consolidated company with all the business units and all posted eliminations.

• The eliminations to make in the consolidated company. That is, the entries in the general journal that is selected on the request page.

• The posting text copied from the general journal.

• The consolidated company's total after the eliminations, if they're posted.

Export and import consolidated data between databases

If data for a business unit is in another database, you can do a manual file-based transfer or automate the process by using an API.

This section describes the manual, file-based process.

You export the data to a file before you include it in the consolidation. Export each company separately by using the Export Consolidation batch job.

After you run the batch job, all entries in general ledger accounts are processed. For every combination of selected dimensions and date, the contents of the entries' Amount fields are totaled and exported. The next combination of the selected dimensions and date with the same account number is processed. Then the combinations in the next account number are processed, and so on.

The exported entries contain the following fields: Account No., Posting Date, and Amount. If dimensions information was also exported, dimension codes and dimension values are also included.

1. For each exported line, if the total of the Amount fields is a debit, the account number that is set up in the business unit's Consol. Debit Acc. field is exported to the line. If the total is a credit, the corresponding number in the Consol. Credit Acc. field is exported to the line.

2. The date used for each exported line is either the period's ending date or, if the transfer occurs each day, the exact date of the calculation.

3. The dimension value exported for the entry will be the consolidated company dimension value that is specified in the Consolidation Code field for that dimension value. If a consolidated company dimension value hasn't been entered in the Consolidated Code field for the dimension value, the dimension value itself will be exported to the line.

4. The XML files also contain the currency exchange rates in the consolidation period. These rates are included in a separate section at the beginning of the file.

Use our API to automatically share data across environments

Business Central provides an API that let's you automate the process of sharing financial data from business units to the consolidated company. The API is free to use and easy to set up. It even let's you share data across Business Central environments. For example, you might need to share across environments when business units are not in the same Azure geographies.