How to Run Consolidation in D365 Business Central

In this blog, I will take you through the steps for running Consolidation in Business Central, for companies within the same database as the consolidated company. 

Consolidation is combining the financial data of two or more separate companies (subsidiaries) into one consolidated company for financial reporting. 

Below I outline the setups required to be completed for the consolidation, and the process of consolidating the data in Business Central. 

Setting up the Consolidation

Set up a Consolidated Company

A new consolidated company first needs to be set up. You can use the ‘Copy’ functionality from the ‘Companies’ page in Business Central, to easily create the consolidated company.

Set up Consolidation information on all G/L Accounts for each subsidiary company

Specify the Consol. Debit Account, Consol. Credit Account and the ‘Consol. Translation Method’ for all the G/L Accounts in Business Central. You can also enable the ‘Exclude from Consolidation’ toggle button if you want to exclude this account during the consolidation process.  

Setting up Business Unit Information

Set up a Business Unit for each subsidiary on the consolidated company.

Specify Exchange Rates for Consolidations

There are five exchange rates that the program uses when consolidating the financial data of subsidiary companies involving foreign currency, in Business Central. They are Average Rate (Manual), Closing Rate, Historical Rate, Composite Rate and Equity Rate. This is specified under the exchange rate methods for each G/L account in the Conso. Translation Method field.

In the consolidation company, you can specify the source of exchange rates for each business unit. In the Currency Exchange Rate Table field on the Business Unit card, select Local to use the consolidation company’s exchange rates, or Business Unit to use those of the subsidiary company.

You can also change the currency factors by going to the Exchange Rates window for each Business Unit card.

Setting up Dimension Information for Consolidations on each subsidiary company

It is also possible to consolidate dimension information as well as G/L Accounts in Business Central.

Only fill in the Consolidated Code field where the dimension value code in the subsidiary company is to be consolidated to a different dimension value code in the consolidated company.

Consolidating the data

Open the Business Unit page on the consolidated company and then click on Actions → Functions → Run Consolidation (Same Environment).

Specify the ‘Consolidation Period’, ‘Copy Dimensions’ ‘Document No.’ and the Business Unit Code. Then click on ‘OK’.

This function will import the financial data from the subsidiary and post it to the consolidated company automatically.

Note: You could also run the consolidation from the Business Unit List by clicking on Consolidate.

Processing Consolidation Eliminations

Any elimination entries will need to be calculated manually and posted using a General Journal.

You could also run the G/L Consolidation Eliminations report to help you preview the effect of the elimination general journal lines before posting.

Note: For more information on any field, select F1 and online help will be displayed for the field. You can ‘Search’ in Business Central to locate any pages.