Setting up consolidation

The set up process

Set up the parent companyreporting company

  1. Create your chart of accounts.

    The majority of your nominal accounts, cost centres (funds), departments, and reports categories and sofa categories should be the same across all your parent and subsidiary companiesschools.

    This makes linking the nominal accounts easier and makes sure that balances are reported on the correct sections of your reports in both the subsidiary and parent.

  2. Set your default nominal accounts.

    You must specify your suspense account before you can consolidate any data.

Set up the subsidiary companyschool

  1. Set the company that is the parent companyreporting company.

  2. Turn on consolidation in the subsidiary companyreporting company.

  3. Link all the nominal accounts in the subsidiary companyschool to a nominal account in the parent companyreporting company.

    See the section Link nominal accounts in the subsidiary to the parent.

Link nominal accounts in the subsidiary to the parent

It's important to have your subsidiary nominal accounts linked correctly, because if the same nominal account doesn't exist in the parent, the transaction will be posted to the suspense account.

The key to successfully consolidating your subsidiary companiesschools is to make sure all your nominal accounts are linked correctly.

The parent companyreporting company and each subsidiary companyschool has their own chart of accounts. To transfer the values from the subsidiary to the parent companyreporting company, you must link the nominal accounts in the subsidiary companyschool to the related nominal accounts in the parent companyreporting company.

The easiest way to do this is to make sure all your subsidiaries and you parent company have the same chart of accounts.

This means all each subsidiary and parent will need to have the same:

Report categories

Must

This makes sure your balances are reported on the same sections on financial statements such as the CFR balances report, P & L and Balance Sheet.

Code (for nominal account) Recommended

This makes it easier for you link your accounts.

You may have some subsidiary companiesschools with unique nominal accounts. In this case, make sure you link to a nominal account in the parent that has the same cost centre (fund) and report category. This will make sure that the value is posted correctly on your P & L and Balance SheetCFR Balances report, P & L, Balance Sheet, and SOFA report.

Cost centre Must

This makes sure balances are reported for the correct cost centrefund type - essential for your SOFA report.

The majority of your income and expense nominal accounts will have a cost centre (fund) associated with them. This cost centre will also have a fund type.

If each subsidiary nominal account with a cost centre is linked to one with the same cost centre in the parent, then this will ensure that your cost centre balancesfunds are reported correctly. The easiest way to do this is use the same cost centres across all your subsidiary companiesschools.

Department Recommended

You can use the Dept section of the nominal account to report income and expenditure by department within each companyschool.

If you use departments, then the departments for your subsidiary companiesschools may be different, for example a primary school may have different departments to a secondary. To resolve this, you will first need to check all the departments used in your subsidiary companiesschools. Then in your parent companyreporting company, you should create all the departments used in all the subsidiary companiesschools, and their associated nominal accounts.

How to link your accounts

There are three methods you can use to link your nominal accounts.

Automatically set all accounts links to the same as subsidiary accounts

If you've set your parent companyreporting company and all subsidiary companiesschools to use the exactly the same nominal accounts, including cost centres (funds) and departments, then this is the quickest way to set up your nominal account links.

All the links to you parent companyreporting company are set to be identical to the accounts in the subsidiary.

Be careful using this. The nominal accounts in each company are not validated, so if any nominal accounts don't exist in your parent company, the balance will be posted to your suspense account when you run the consolidation.

How to do this

In your subsidiary company:

Open: Settings > Cash Book / Nominal Ledger > Nominal Ledger Settings.

  1. Select Edit.
  2. Select the Consolidations tab.
  3. Select Set consolidated nominal accounts.

Select the accounts to link from a list

Use Amend Report Categories and Consolidation Settings. This shows all your subsidiary nominal accounts in a list, alongside the linked account from the parent companyreporting company.

How to do this

In your subsidiary company:

Open: Settings > Cash Book / Nominal Ledger > Amend Report Categories and Consolidation Settings.

  1. Click Display to show your nominal accounts.
    • To filter the list, select Code, Cost centre or Report category; then select the range to display.
  2. Link the nominal account in the subsidiary to the account in the parent:
    1. Select the Cons. Code column for the account.
    2. Choose the matching account to link to in the parent companyreporting company.
  3. Click Save.

Link an individual nominal account

You can choose the consolidated account when you create or amend a nominal account. This is most useful when you create a new one-off account. You can select the Consolidated Account from a list of nominal accounts in the parent companyreporting company.

How to do this

In your subsidiary company:

Open: Settings > Nominal > Create new nominal account.

Open: Settings > Nominal > Amend nominal account.

  1. Choose the account Code from the Consolidated Account list.
  2. Click Save.

Tip: The Consolidated account will be highlighted yellow if the account you selected doesn't exist in the parent. Don't forget the Code, CC and Dept all need to match.

More than one parent company

Each parent should still only be used for consolidated reporting and not used for trading.

You'll have to consolidate into each parent, working up from the bottom of the hierarchy, before consolidating into the final parent companyreporting company.

To set this up you'll need to:

  • Create a Sage 200cloud company for each parent companyreporting company.
  • Choose a parent for each subsidiary companyschool.
  • Enable the consolidation and set the nominal account links in the subsidiary companiesschools.
  • Choose the parent for any companyreporting company that is a subsidiary of another parent companyreporting company.
  • Enable the consolidation and set the nominal account links in these parent companiesreporting companies.