There are many instances where a financial institution relies on spreadsheets or external tools for group reporting. These methods of updating and managing real-time data can be inefficient and time-consuming. A business must have a report ready by the month-end or year-end.
Microsoft Dynamics 365 Business Central can be a robust ERP solution that not only eliminates such problems but also makes currency conversion and multi-entity accounting in the UK easier.
This powerful ERP comes with built-in features that can manage multi-entity and multi-currency consolidation efficiently. Microsoft Dynamics 365 lets you fetch financial data and create accurate reports that can ease the burden and improve customer satisfaction.
With the help of this blog, we will uncover how Business Central helps in encountering multi-currency and multi-entity accounting in the UK.
What is Microsoft Dynamics 365 Business Central?
Microsoft Business Central is a cloud accounting ERP solution that helps businesses grow faster and streamline complex processes by automating them. Business Central helps organizations to handle data across the departments, including finance, supply chain, manufacturing, sales, project management, and services.
Dynamics 365 Business Central is specifically designed for SMEs that want a tailored solution which can boost revenue growth and add functionality to their respective industries and operations.
Key Benefits of Using Business Central for Consolidation
Below are some of the reasons why Business Central helps companies with multi-currency financial consolidation:
1. One System, Multiple Entities
One ERP system can hold multiple company profiles, depending upon your preference, that can aid you in managing and tracking data of each legal entity and running shared reports.
Through ERP, each entity can have its own tax rules, currencies, and chart of accounts, which helps to manage consolidation more easily.
2. Currency Management Made Simple
Set up exchange rates, and Business Central will apply them during consolidation automatically. No need to track conversions manually.
Use case: A company billing in EUR and reporting in GBP can consolidate financials with exchange rates pulled from reliable data sources.
3. Intercompany Transactions
Intercompany sales, services, or inventory transfers are common in SMEs. Thus, Business Central aids them with automating invoice creation, matching purchase orders and managing consolidation.
4. Accurate, Compliant Reports
This robust ERP helps you to be ready for quarterly, monthly audits or board meetings and track changes, approval workflows, and adjustments.
5. Reduced Workload and Faster Closing
Streamlining consolidation using ERP can increase employees’ productivity and reduce time-consuming routine tasks.
Setting Up Consolidated Financial Reporting in Business Central
You can follow the above-mentioned steps to set up consolidated financial reporting in Business Central that will help your organization to plan and streamline complex business processes:
1. Define Your Consolidation Structure.
The initial step for every organization to set up consolidation should be identifying parent and subsidiary companies that will sort inventory and demands. You should also choose reporting structures based on currency type.
2. Configure Business Central for Consolidation.
Business Central provides built-in tools which help users create consolidation within the system and import financial data from subsidiaries.
3. Currency and Exchange Rate Considerations
An organization that operates across the globe should be able to manage exchange rate adjustments, track foreign currency transactions and automate currency revaluation.
4. Intercompany Transactions and Eliminations
With Business Central, internal sales, loans, or cost allocations can be managed and stored, which eliminates double-counting and excludes intra-group transactions from consolidated reports. This helps in maintaining clear audit trails for compliance and transparency.
5. Generating Consolidated Financial Statements
After configuring the intercompany transaction, it enables Business Central to generate consolidated income statements, balance sheets, and maintain cash flow. You can also use Power BI integration to interact with data and improve reporting through visualization. By automating the complex process of consolidation, you will be able to reduce manual effort and achieve improved efficiency.
Why choose Business Central partner
Choosing Dynamics 365 Business Central for your finance team will improve customer satisfaction and ease manual effort with automation. Considering business central partner who has certified experts that has transformed businesses over time is crucial.
At Business Central Partner, we understand what can boost your company and aid your finance department to streamline processes.
VAT Compliance: This robust software offers fully MTD (Making Tax Digital) compliant VAT reporting, ensuring adherence to UK tax regulations.
Scalability: Business Central promotes scalability options for every SMEs as they expand.
Global Reach: As a Microsoft product, Business Central supports a wide range of languages and countries, ensuring suitability for organizations operating globally.
With over 10 years of experience and a team of 150+ seasoned accountants, our professionals deliver accuracy and efficiency, allowing you to focus confidently on growing your business. Partner with us to enjoy smart accounting services that boost your growth.
Conclusion
For businesses managing multiple subsidiaries or entities, financial consolidation can be a complex and time-consuming task. Ensuring accurate reporting across multiple companies requires the right tools and processes. Microsoft Dynamics 365 Business Central offers a comprehensive solution for multi-entity financial consolidation.
We provide expert outsourced accounting services designed to streamline your financial processes while saving you time and resources. By automating processes and ensuring accurate, real-time reporting, organizations can improve efficiency and gain deeper financial insights. Whether managing multiple subsidiaries, handling intercompany transactions, or consolidating reports across different currencies, Business Central simplifies the process and enhances financial control.
If your organization is looking to streamline financial consolidation, now is the time to explore Business Central’s capabilities.
Frequently asked questions
How does Business Central handle multi-currency accounting?
Business Central automatically manages multiple currencies by updating exchange rates, revaluing foreign currency balances, and providing accurate reporting in both local and foreign currencies. This ensures UK businesses with international operations can stay compliant and reduce manual errors.
Can Business Central support UK companies with multiple entities or subsidiaries?
Yes. Business Central enables multi-entity accounting by consolidating financial data across subsidiaries, branches, or group companies. It allows UK businesses to manage intercompany transactions, shared services, and consolidated reporting within one system.
Is Business Central compliant with UK accounting and tax regulations when managing multiple currencies?
Absolutely. Business Central is HMRC-recognized for Making Tax Digital (MTD) and provides built-in features for VAT, statutory reporting, and compliance, even when dealing with multiple currencies and global operations.
How does Business Central make intercompany transactions easier?
The system automates intercompany postings, reconciliations, and eliminations. For UK businesses with group structures, this reduces manual work and improves financial accuracy across all entities.
How does Business Central compare to Sage in terms of multi-currency and multi-entity support?
Business Central provides deeper automation, real-time consolidation and promotes integration with Microsoft tools. While Sage offers some multi-currency features, Business Central provides deeper automation, real-time consolidation, and seamless integration for growing UK companies with international operations. Business Central is often the more scalable choice.
Is Business Central suitable for UK SMEs with overseas trade?
Yes. You can choose Business Central ERP for manufacturing SMEs, specifically if you trade in the EU, the US or Asia. This robust ERP can manage foreign currency transactions, supplier payments, and customer invoices efficiently and eliminates the complexity of manual adjustments.
