Seradex ERP Implementations for Multi Company Organizations
COA and Multiple Company Design
Considerations
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Seradex ERP Implementation in a Multi Company Environment
COA and Multiple Company Design
Considerations
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• Legal Firewalls
• Tax Benefits
• Business Efficiencies
• Different Shareholders
• Future Divestiture
If These Don’t Exist
Consider Merging
To Save $
COA and Multiple Company Design
Considerations
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• There is no ONE correct setup - a buffet of options
• No Free Lunch – Every Alternative has Downsides
• Trade off Operational, Finance And Legal Factors
• Thoughtful And Detailed Planning Required
COA and Multiple Company Design
Considerations
4

Multi-Entity Multi-Company Wish List
• Balance Centralization / Decentralization
• Real Time Reporting Across All Entities
• Global Supply Chain Visibility
• Regulatory Compliance At Least Cost
• Minimize Income Taxes, Sales Taxes And Tariffs
• Standardize Business Methods
• Automate Intercompany Transactions
• Maintain Local Customer Relationships
• Allow For Easy Acquisitions / Divestures
COA and Multiple Company Design
Considerations
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What is Not Covered Today
• Server Locations
• Database Locations
• Remote Connectivity
• Bandwidth
• Network Security
• Single Sign on
• Email
COA and Multiple Company Design
Considerations
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COA and Multiple Company Design
Considerations
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Decision 1 – What Remains Decentralized?
COA and Multiple Company Design
Considerations
Usually No Debate on:
• Inventory Control
• Shipping
• Production Control
• Field Service
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Decision 2 – What to Centralize?
What Activities Here?
COA and Multiple Company Design
Considerations
What Activities Here?
What Activities Here?
• Inventory Control
• Shipping
• Production Control
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Financial Reporting
General Ledger
Accounts Receivable
Accounts Payables
Payroll
Banking
IT
Engineering
Purchasing
Order Entry
Invoicing
Shipping / Receiving
Inventory & Production
Multi Company Design – Scenario 1
Head Office
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Company Each Location
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COA and Multiple Company Design
Considerations
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Multi Company Design – Scenario 1
• Financial Reporting
• GL/AR/AP
• Payroll
• Banking
• Order Entry
• IT
• Engineering
• Purchasing
COA and Multiple Company Design
Considerations
• Inventory Control
• Shipping / Receiving
• Production Control
• Invoicing
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Multi Company Design – Scenario 1
Advantages
• Conventional Setup
• Mirrors operations at time of Acquisition • Financial Reporting
• Built in Segregation of Company Data
• Each Company has Uncluttered View of
Orders, Production Schedules Etc,
• Can have different Fiscal Yrs & Currencies for each company
Disadvantages
• No Cost Savings from Centralization
• No Global Supply Chain Visibility
• Distributed Customer, Vendor, Item Data
• Decentralized Credit Control
• Company Wide Reporting is Difficult
• Difficult to Standardize Business Processes
• GL/AR/AP
• Payroll
• Banking
• Order Entry
• IT
• Engineering
• Purchasing
• Inventory Control
• Shipping / Receiving
• Production Control
• Invoicing
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Considerations

Financial Reporting
General Ledger
Accounts Receivable
Accounts Payables
Payroll
Banking
IT
Engineering
Purchasing
Order Entry
Invoicing
Shipping / Receiving
Inventory & Production
Multi Company Design – Scenario 2
Company Each Location Head Office
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COA and Multiple Company Design
Considerations
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Multi Company Design – Scenario 2
• Financial Reporting
• GL/AR/AP
• Payroll
• Banking
• Order Entry
• IT
• Engineering
• Purchasing
COA and Multiple Company Design
Considerations
• Inventory Control
• Shipping / Receiving
• Production Control
• Invoicing
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Multi Company Design – Scenario 2
Advantages
• Possible Cost Savings from Centralization
• Global Supply Chain Visibility
• Company Wide Reporting
• Standardize Business Processes
• Distribute Orders to Optimal Location
• Centralized Customer, Vendor, Item Data
• Financial Reporting
• GL/AR/AP
• Payroll
• Banking
• Order Entry
• IT
• Engineering
• Purchasing
Disadvantages
• Costs to Segregate Company Data
• Bureaucracy Costs and Response Delays
COA and Multiple Company Design
Considerations
• Inventory Control
• Shipping / Receiving
• Production Control
• Invoicing
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Multi Company Design – Scenario 3
Each Location
Financial Reporting
General Ledger
Accounts Receivable
Accounts Payables
Payroll
Banking
IT
Engineering
Purchasing
Order Entry
Invoicing
Shipping / Receiving
Inventory & Production
Head Office Company
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COA and Multiple Company Design
Considerations
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Multi Company Design – Scenario 3
• Financial Reporting
• GL/AR/AP
• Payroll
• Banking
• IT
• Order Entry
• Engineering
• Purchasing
COA and Multiple Company Design
Considerations
• Inventory Control
• Shipping / Receiving
• Production Control
• Invoicing
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Multi Company Design – Scenario 3
Advantages
• Possible Cost Savings from Centralization
• Global Supply Chain Visibility
• Company Wide Reporting
• Standardize Business Processes
• Centralized Customer, Vendor, Item Data
• Costs to Segregate Company Data
• Centralized Credit Control
• Financial Reporting
• GL/AR/AP
• Payroll
• Banking
• IT
• Order Entry
• Engineering
• Purchasing
Disadvantages
• Can’t Distribute Orders to other Companies
• Bureaucracy Costs and Response Delays
COA and Multiple Company Design
Considerations
• Inventory Control
• Shipping / Receiving
• Production Control
• Invoicing
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Issue
Vendors / Initial Cost
Typical Architecture
Data Separation by Co
Separate Fiscal Yrs by Co
Period End by Co
Choose Base Currency by
Co
Consolidation Approach
General Ledger Selection
Tier 1
SAP, Oracle
$200K+
Single
GL/AR/AP
Yes
Yes
Yes
Yes
Tier 2
Great Plains, ACCPAC, MAS90
$10K - $20K
Each Co has a GL/AR/AP
Not within 1 GL
Not within 1 GL
Not within 1 GL
Not within 1 GL
Company Field on Journal
Entries
Integrated Typically - External Batch
Function to Role up Multiple
GL’s
Yes No - but can use GL Segment if using Single GL Approach
COA and Multiple Company Design
Considerations
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Multiple Company
Security Costs and Data Segregation
COA and Multiple Company Design
Considerations
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Multi Company Design – Seradex Implementation
COA and Multiple Company Design
Considerations
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Multi Company Design – Seradex Implementation
COA and Multiple Company Design
Considerations
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Multi Company Design – Seradex Implementation
Next Steps
• Finalize Number of Legal Entities
• Select Centralized & Decentralized Functions
• Select & Implement General Ledger, AR, AP Software
• Architect IT
– Servers – File & Print, Exchange, SQL Server, Citrix
– Network Domains
– Remote Connectivity
– Bandwidth Analysis
• Finalize GL Chart of Accounts
• Create Seradex Project Plan
• Architect Seradex
– Number of Databases
– Intercompany Transactions
• Implement Seradex according to Plan
COA and Multiple Company Design
Considerations
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