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New Chart of Accounts - Suggestions?

DBohner-(db)

Legendary Poster
We would like an account reporting structure / COA that looks like:
- Company
- Location within Company (Factory X)
- Department Within Location ( Factory X; AP, MFG, IT, ...)
- Labor, Materials, Costs / Expenses...
- Detail of Labor, Material, Costs / Expenses

Traditional would look like:
Company.Location.Department.Detail.SubDetail or CO.MCU.OBJ.SUB.SBL?? Is that correct?:confused:

So - what would that Chart of Account Structure look like?

(db)
 

rsvconsulting

VIP Member
What you describe as "traditional" is the account string structure. I believe you may need something more in terms of intelligent definition in order to define the elements of the 12 alphanumeric business unit (MCU). Defining the business unit further will also enable you to use the business unit category codes to create low mode "ad hoc" online consolidations. This will give real power to your financial inquiries and will support many financial business views throughout the Enterprise.
 
Daniel - don't use OBJ to represent Department
The OBJ and SUB are the "What" of the account structure e.g. the Labor, Materials, Expense etc. and should be consistent across ALL Business Units (BU) and Companies.
As suggested by Al, structure your Business Unit (MCU) to cover Location / Department since BU should represent the "Where" of the revenue or expense.
Use BU Cat Codes to report by Department e.g. IT expenses across multiple Location / IT BU's
The BU should be the lowest level of detail that you want to report, you can always use Cat Codes to consolidate multiple BU
Regards - Vic
 

rsvconsulting

VIP Member
Sample Business Unit - Account string attached

Sample Business Unit - Account string attached...............this will give some idea of how this rationale can be applied to specific entities.
 

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If you have a subscription to JDE Tips have a look at all the chart of accounts papers there, they explain in great detail how to build a good CoA.
 

peterbruce

Legendary Poster
Dan,

We would like an account reporting structure / COA that looks like:
- Company
- Location within Company (Factory X)
- Department Within Location ( Factory X; AP, MFG, IT, ...)
- Labor, Materials, Costs / Expenses...
- Detail of Labor, Material, Costs / Expenses

Traditional would look like:
Company.Location.Department.Detail.SubDetail or CO.MCU.OBJ.SUB.SBL?? Is that correct?:confused:

So - what would that Chart of Account Structure look like?

(db)
Using the information you have provided:

- Company -------------------------------------------------------- F0901.GMCO
- Location within Company (Factory X) ------------------------- F0006.MCMCU using a category code to identify and report on the location
- Department Within Location ( Factory X; AP, MFG, IT, ...) -- F0006.MCMCU using another category code to identify and report on the department
- Labor, Materials, Costs / Expenses... ------------------------- F0901.GMOBJ
- Detail of Labor, Material, Costs / Expenses ------------------- F0901.GMSUB or F0911.GLSBL

Another option for Location (Factory) and Department might be using the F0006.MCMCU with values that have meaning. For example using a convention where the first 6 characters for location and the last 6 characters for department. But the usefulness of this is limited as changes may mean creating a new Cost Centre which may not be what is desired. The convention cannot be enforced without Flex Format (see below).

A third option might be Flex Format (P0907), which (if I remember correctly) combines cost centre category codes with the F0006.MCMCU with values that have meaning. You would be best to look at the manual for this.
 

rsvconsulting

VIP Member
Thanks Peter. But in my opinion, based on a lot of experience with COA creation, he really needs to rethink the busness unit (MCU) structure very carefully and align it with the business needs at all levels. I have done this for a number of enterprises and it does take a lot of white-boarding and proof of concept demo to insure that all organizational needs are met. But the MCU is key; it is a 12 character alpha numeric that has a tremendous value and must be carefully defined and configured.
 
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