Legal Entity Overrides for Main Accounts in Microsoft Dynamics 365 Finance
Posted on: November 1, 2023 | By: Christopher Rusing | Microsoft Dynamics AX/365
Creating a new main account is a common periodic process for accounting users of D365 for Finance. It is typical in many D365 for Finance environments that a new main account is created within a shared chart of accounts for ease of maintenance and reporting. In previous versions, like AX 2012, you were able to add alternative configurations and settings for each main account per legal entity via the legal entity override option. This allowed you to add active to/from dates, suspend main accounts, and add default financial dimension values while creating that main account.
Recently, in D365 for Finance, the legal entity override functionality has been expanded to add an extremely important feature. The option to check ‘Do not allow manual entry’ can now be configured through the legal entity override function. The ‘Do not allow manual entry’ is a key configuration to ensure that your general ledger and various subledgers stay in balance. For example, the main accounts associated with a bank account must be marked for ‘Do not allow manual entry’ to keep the subledger of the bank account in balance with the general ledger account.
The legal entity override option for this functionality is very helpful for a couple of reasons. Firstly, if certain legal entities would like to post directly to a main account that is locked for manual entry in other companies, then they can do so by adding a legal entity override. It’s possible that companies would like to use the same ledger account to maintain their consolidated reporting, but certain legal entities do not have that subledger relationship built yet. The company without the subledger configuration can continue to post to the ledger account without affecting the subledger configuration for the other legal entities. Lastly, it is possible that many legal entities might already be live in D365, and another legal entity is being brought into the environment. This functionality would allow the implementation team to load GL balances without affecting the configuration of the current main accounts. It is imperative to keep the ‘Do not allow manual entry’ checked for all subledger accounts as this would possibly cause the general ledger and subledger to become out of balance.
If you want to learn more about legal entity overrides for main accounts in Microsoft Dynamics 365 Finance, contact us here to learn how we can help you grow your business. You can also email us at email@example.com or call (312) 345-8817.
2020 Nucleus Research Report on ERP Technology