Acumatica gives you flexibility in setting up your organization structure from a simplest structure to a more complex multi-company structure using Tenants, Companies and Branches. However, this flexibility creates some confusion for some as to how to choose between setting a multi-company environment as companies or as branches. Should I set my multicompany environment as Companies or Branches? which is the right choice to make? The answer is either will work however, a good understanding of the design philosophy and a couple definitions will make the choice easier.
Acumatica organizational design is set up in a hierarchical way. You first log into an instance then a Tenant, and from a tenant unto a company, from a company unto branches.
In Acumatica ERP, a Company represents a legal entity, an independent balance sheet, with EIN number, and a separate tax reporting.
A Branch by contrast can be a division, a separate location, a separate office or a profit center or a point of sale capable of performance reporting.
An organization may consist of one company or multiple companies. A company may have no branches, or it may consist of multiple branches, each being a separate office, a division, or a location. A branch does not need to have its own EIN but a company does.
However, due to Acumatica’s flexibility, a branch can be construed as a company therefore you can set up your multi-company structure in the following manner:
- Company Without Branches: A company with this type cannot have any branches.
- Company With Branches Not Requiring Balancing: A company with this type must have at least one branch. If multiple branches of the company are involved in a transaction, balancing entries are not required.
- Company With Branches Requiring Balancing: A company with this type must have at least one branch. If multiple branches of the company are involved in a transaction, balancing entries are required. Multi-Branch Support and Inter-Branch Transactions features must be enabled
In Acumatica you have many options so if you need further assistance, schedule a consultation with the MIBAR team.