Consolidation Basic Data and Requirements—Exercises

Basic Data Setup

Purpose: The purpose of this exercise is to set up the basic data required for running this functionality.

Before you begin the consolidation exercises, make sure that the following exist:

1. Two or more companies, one of which is a parent company.

2. Opening Balances (Period 00) in the subsidiaries that should be consolidated.

3. Transactions in the subsidiary companies so that there is data to consolidate. Minimum is data in Period 1.

4. A budget in at least one subsidiary company.

5. A budget version in the parent company.

Note: Depending on the data to be consolidated, it may be necessary to set up the parent company as a holding company, i.e., a company that owns subsidiaries but that has no financial transactions of its own. For example, you need to set up a holding company if fixed asset or project code parts are to be consolidated to the parent. Because these code parts have specific functions and their own sub-ledgers, data cannot be consolidated into them from a subsidiary.

Main Exercises

Purpose: The purpose of this lesson is to familiarize you with the basic data and requirements for the Consolidation process. This process involves gathering transactions from each period from one or more subsidiary companies and transferring the balances to the parent company.

Basic Data Setup for the Parent Company

Purpose: The purpose of this exercise is to set up the basic data required for the parent company. The subsidiary company's transaction data that is transferred to the parent must clearly be separate from the parent company's transaction data. This is accomplished through the use of a code part for consolidation purposes. Only parent companies require a consolidation code part. The rest of the setup ensures that the consolidated balances are posted correctly. All the transactions in this exercise should be performed in the parent company.

Windows:
Define Code String
Code Part Values
Account Types
Voucher Type
Currency Rate Types
Currency Rates
Posting Control
Company Relationships

1. Open the Define Code String window, populate, and view the existing code parts.
2. If a consolidation code part does not already exist, create one.
3. Enter the data in the table below.

Internal Name	Code Used	Code Part Function
Name your consolidation code part	Yes	Consolidation

4. Save your changes.
5. Open the Code Part Values window.
6. Select the tab for the code part that is used for the consolidation function. Populate this tab.
7. Enter a line for each subsidiary company that will be consolidated to the parent.
8. Create a new record, and enter the data in the table below.

9. Continue adding lines until all subsidiary companies have been identified.
10. Save your changes.

Note:  Back the valid-from date to the earliest date on which any consolidation activities occurred.

11. Open the Account Types window, and populate it.
12. If the code part demand for the consolidation code part is Blocked, then change it to either Can or Mandatory. Repeat this process for the Default Budget Codepart demands.
13. Save your changes. You are prompted to indicate whether you want to update the code part demands for all existing accounts according to your changes.
14. Click Yes.
15. Repeat this process for each of the account types.

Note: If only a few accounts will be used for consolidation, you can update the code part demands for each account instead of at the account type level.

16. Open the Voucher Type window, and query for Voucher Type C.
17. Verify that the Store Original check box is checked.
18. Save your changes.

Note: The purpose of the following steps is to use the correct currency rates and to post differences in accounting when multiple currencies are used. The currency rounding differences are posted to the account string based on the GP6 posting type. The currency recalculation rounding differences are posted to the account string based on the GP7 posting type. If multiple currencies are not being used, skip to the next exercise. 

19. Open the Currency Rate Types window, and populate it.
20. Enter one currency rate type that will be used for Balance Sheet accounts and one for Profit & Loss accounts
21. Save your changes.
22. Open the Currency Rates window, and populate it.
23. Select the first currency rate type to be updated.
24. Update the currency rates.
25. Save your changes.
26. Repeat step 23-25 for the second currency rate type.
27. Open the Posting Control window. Query for the GP6 Consolidation Diff Account posting type and the GP7 Consolidation Recalculation Diff  posting type.
28. Change the posting types as necessary based on the code part requirements of the parent company.
29. Save your changes.

The final steps of this exercise will show you how to connect each subsidiary company to the parent company.

30. Open the Company Relationships window.
31. Enter a new line with subsidiary company, parent company and Cons Code Part Value, using the List of Values function in each column. 
32. Repeat for each subsidiary.
33. Save your changes.

Basic Data Setup for the Subsidiary Company

Purpose: The purpose of this exercise is to show you how to connect the subsidiary's Chart of Accounts/Accounting structure to the parent company. If the parent and subsidiary use the same chart of accounts, then the setup is simple, and you need to complete only the first three steps of this exercise. If the parent and subsidiary use different charts of accounts, or if the parent requires more detailed data during consolidation, then additional setup is necessary. The transactions in this exercise should be performed for each subsidiary.

Windows:
Define Code String
Account
Account Groups
Code Part Values

1. Open the Define Code String window, and populate it to display the subsidiary's code parts.
2. In the Parent Code Part field, use the List of Values to select the correct parent code part for each code part to be consolidated.
3. Save your changes.

Note: The level of detail required for the consolidation determines which IFS Applications window should be used. If each account in the subsidiary must be consolidated to a different account in the parent, then you should use the Account window. On the other hand, if each group of accounts in the subsidiary will be consolidated to one account in the parent, then you should use the Account Groups window. An example of this would be the consolidation of all cash and cash equivalent accounts to one cash account in the parent. A combination of accounts and account groups could be used. If the account is the only code part to be consolidated, then you do not need to use the Code Part Values window.

4. Open the Account window, and query for an account to be consolidated.
5. Click the Consolidation tab.
6. Enter the account of the consolidating parent company.
7. Save your changes.
8. Repeat steps 4–6 above for each account that will be consolidated to a specific parent account.
9. Open the Account Groups window, and query for an account group that will be consolidated to a specific account in the parent.
10. Enter the default parent account.
11. Save your changes.
12. Repeat steps 9–11 above for each account group that will be consolidated.
13. Open the Code Part Values window, and populate the appropriate tab for any code part whose data will be consolidated.
14. Enter the consolidating code part value for each code part in the tab.
15. Save your changes.
16. Repeat steps 13–15 for each code part tab that is required for consolidation.