[ADVANCED FEATURES] Multi company setup

Summary

This video tutorial explains how to optimize a multi-company setup using Odoo. It explores how to manage inter-company transactions, reinvoice expenses, and create financial reports excluding inter-company entries. Key features like synchronization of invoices, journal groups, and analytic tags are discussed to streamline operations between subsidiaries. The presenter also demonstrates how to handle tax reports for multiple companies, emphasizing best practices for maintaining separate charts of accounts across different countries to avoid financial reporting issues. The video concludes with recommendations for managing unique accounting setups efficiently.

Takeaways

• 📊 Multi-company environments in Odoo can be optimized for efficient inter-company workflows.
• 🤝 FP Cars Group needs to manage inter-company transactions due to shared expenses and revenue, such as Belgium’s investment in a communication system.
• 🔄 Odoo’s inter-company transactions feature allows synchronization of purchases, sales orders, invoices, and vendor bills between companies.
• 💡 Journal groups can be used to exclude inter-company transactions from financial reports, providing a clear picture without these entries.
• 📑 Analytic tags can help identify and manage amounts that need to be reinvoiced between subsidiaries, allowing for partial or full cost allocation.
• 🧾 Synchronizing transactions, such as invoices and bills, ensures that both sides (e.g., Belgium and UK) automatically update with corresponding entries.
• 📈 Journal groups provide an effective way to create financial reports that exclude inter-company transactions for more accurate group reporting.
• 💼 Monthly reinvoicing can be managed using analytic tags and accounts, allowing easy tracking of amounts to be billed between companies.
• 🔧 Companies can export accounting data from Odoo to third-party software for consolidated group reporting, but a direct integration is not always recommended.
• 🌍 Odoo supports joint tax reporting for multiple companies in the same country by adding a system parameter, but this doesn't apply to cross-country setups.

Q & A

What is the primary use case discussed in the video?

The primary use case is managing inter-company workflows within FPIncars Group, where subsidiaries periodically reinvoice each other for shared expenses and revenues, such as communication system costs paid by FP Cars Belgium but used by other subsidiaries.

How does the intercompany transactions feature in Odoo help manage inter-company transactions?

The intercompany transactions feature in Odoo synchronizes purchases, sale orders, invoices, and vendor bills between subsidiaries. For example, when one company creates a vendor bill, the corresponding customer invoice is automatically generated in the other company, reducing communication gaps.

Why is it important to create separate journals for inter-company transactions?

Creating separate journals for inter-company transactions helps in financial reporting by allowing companies to exclude inter-company entries from their reports, such as profit and loss statements and balance sheets. This ensures that financial reports reflect business activity without skewing results due to inter-company accounting.

What role do analytic tags play in managing inter-company transactions?

Analytic tags help track amounts that need to be reinvoiced to other companies. By assigning tags to specific transactions, such as purchases that need to be shared among subsidiaries, companies can easily isolate these amounts and reinvoice them at the end of the month.

What is the process of setting up intercompany synchronization in Odoo?

To set up intercompany synchronization, users need to activate the intercompany transactions feature in the settings of each company. Then, they can choose what to synchronize, such as invoices, bills, sales orders, or purchase orders, and assign users to handle these transactions.

How does Odoo handle the reinvoicing of shared expenses between subsidiaries?

At the end of the period, companies can use analytic tags to aggregate all the shared expenses. By reviewing the analytic items, they can create a single customer invoice or vendor bill to reinvoice the other company, ensuring that all shared costs are accounted for.

How can companies in Odoo generate financial reports without including inter-company entries?

Companies can create journal groups that exclude inter-company transactions. When generating financial reports, they can apply these journal groups as filters to exclude inter-company entries from the profit and loss or balance sheet reports.

What is the recommended way to handle a tax report for multiple companies in Odoo?

While Odoo does not support joint tax reports for multiple companies by default, it is possible to enable this feature by adding a system parameter called 'account.tax.report.multi.company' in the technical settings. However, this should only be used when the companies are within the same country.

Is it possible to use a single chart of accounts for multiple companies in different countries?

No, it is not recommended to use a single chart of accounts for companies in different countries due to the specific accounting requirements in each country, such as different codes and reporting formats. Each company should maintain its own chart of accounts to ensure accurate financial reporting.

How does Odoo support integration with external consolidation software?

Odoo does not offer direct integration with external consolidation software. Instead, companies can export their accounting entries from Odoo and import them into their consolidation software for group-wide financial reporting.

Outlines

00:00

🚗 Introduction to Multi-Company Setup in Odoo

The video begins by introducing a scenario involving a multi-company setup in Odoo, specifically for a company group called 'FPCars.' The consultant must manage inter-company transactions efficiently, as the companies reinvoice each other for shared expenses and revenue. The use case includes handling shared costs, like the new long-distance communication system in Belgium, and ensuring financial reports exclude inter-company entries.

05:02

🔄 Synchronizing Intercompany Transactions

This section explains the process of handling inter-company transactions in Odoo. The inter-company transactions feature allows synchronization of purchase and sale orders, invoices, and vendor bills across different companies. It discusses the use of journal groups for aggregated financial reporting, excluding inter-company transactions. Additionally, analytic tags can be applied to identify amounts that need to be reinvoiced to other companies.

10:03

📊 Automating Intercompany Invoices and Bills

Here, the process of creating and confirming intercompany invoices is demonstrated, highlighting the automatic creation of vendor bills in the other company's system. The synchronization ensures that once an invoice is confirmed in one company, a corresponding bill is created in the other. The importance of configuring analytic tags and the benefits of automation for accurate and efficient inter-company accounting are emphasized.

15:05

📚 Managing Financial Reports with Journal Groups

The focus is on creating journal groups in Odoo to segregate inter-company transactions from regular business activities. This helps generate accurate financial reports, allowing companies to toggle between including or excluding inter-company transactions. A detailed step-by-step guide is provided for setting up journal groups and filtering financial reports, demonstrating how this method can be used to view financial data with or without inter-company transactions.

20:06

🔍 Using Analytic Tags for Re-Invoicing

This section covers the use of analytic tags to identify costs that need to be reinvoiced between companies. It explains how to allocate different portions of purchases and sales to various companies using analytic accounts. By grouping by analytic accounts, companies can easily track and reinvoice amounts at the end of the month, ensuring accurate and streamlined financial management between subsidiaries.

📈 Handling Month-End Re-Invoicing and Analytic Items

A detailed example of handling month-end re-invoicing is given, where analytic items are used to track expenses and revenue between companies. The process of creating a customer invoice for reinvoicing is explained, along with the importance of ensuring that all amounts have been properly reinvoiced. The use of analytic accounts and tags allows for detailed tracking and reporting, ensuring no amounts are missed during invoicing.

💻 Frequently Asked Questions: Consolidated Accounting Integration

In this FAQ section, the video addresses common questions about integrating Odoo with other accounting systems for consolidated financial reporting. It explains that while direct integration is often not recommended, exporting and importing accounting data into external software is a viable workaround. Additionally, it discusses how to create a joint tax report for multiple companies by modifying system parameters, particularly when the companies are within the same country.

📊 Customizing Chart of Accounts for Multi-Company Setup

This part answers questions about having a unified chart of accounts for different companies within a group. While possible, it is not recommended due to the differing financial report structures between countries. The video explains the risks of having a single chart of accounts across countries with different accounting standards and recommends keeping distinct charts for each country to ensure compliance with local regulations.

🚨 Avoiding Pitfalls in Multi-Country Chart of Accounts

This section emphasizes the importance of maintaining separate charts of accounts when companies operate in different countries. The structure and numbering of accounts differ between countries, making it problematic to use a single chart of accounts. The video advises against trying to merge charts of accounts for companies in countries like Belgium and France, as it can lead to inaccurate financial reporting.

✅ Conclusion: Best Practices for Multi-Company Setup

The video wraps up with a final review of best practices for handling multi-company setups in Odoo. It highlights the importance of proper configuration, the use of analytic tags, journal groups, and the synchronization of inter-company transactions. The video concludes with advice against consolidating charts of accounts across countries and emphasizes the value of keeping distinct accounting structures for accurate reporting.

Keywords

💡Multi-company setup

A multi-company setup refers to managing multiple companies or subsidiaries within a larger business group, each with its own accounting and operational needs. In the video, this setup involves handling interactions between FPIncars’ different subsidiaries, particularly when they need to reinvoice each other for shared expenses or revenues.

💡Intercompany transactions

Intercompany transactions are financial exchanges between companies within the same corporate group, such as invoicing or billing. In the video, these transactions are automated between the Belgian and UK subsidiaries of FPIncars to streamline reinvoicing for shared costs like the new communication system.

💡Synchronization

Synchronization in the context of this video refers to the automatic alignment of accounting records between different companies within a group. It allows for real-time reflection of transactions like sales and purchases across subsidiaries, reducing errors and delays in bookkeeping.

💡Journal groups

Journal groups are used to categorize and group journal entries in financial reporting. In the video, they help FPIncars exclude intercompany transactions from financial reports, making it easier to see a company’s performance without internal transactions distorting the view.

💡Reinvoicing

Reinvoicing is the process of charging one company for expenses that were originally incurred by another company in the same corporate group. In the video, FPIncars Belgium pays for the communication system, but reinvoices other subsidiaries to share the cost.

💡Analytic tags

Analytic tags help track specific transactions and categorize them for reporting or reinvoicing purposes. In this setup, they are used to identify which expenses should be charged to other subsidiaries, making it easier to reinvoice at the end of the month.

💡Financial reporting

Financial reporting involves generating statements like profit and loss or balance sheets to give a snapshot of a company’s financial health. The video shows how to generate reports both with and without intercompany transactions, ensuring accurate views of financial data.

💡Vendor bills

Vendor bills refer to invoices received from suppliers for goods or services. In this video, vendor bills between the FPIncars subsidiaries are automatically synchronized to ensure proper recording of intercompany transactions.

💡Customer invoices

Customer invoices are billing documents sent to clients for products or services provided. The video explains how these invoices are automatically generated and synchronized between subsidiaries in a multi-company setup, ensuring both parties have matching records.

💡Aggregation

Aggregation refers to combining data from different sources into a unified report. In this case, it involves grouping journal entries or financial reports across different companies, allowing FPIncars to view financial performance without the noise of intercompany transactions.

Highlights

The FPincars group manages inter-company transactions for shared expenses and revenues across subsidiaries.

The pandemic led FP Cars Belgium to invest in a long-distance communication system for all subsidiaries, with costs paid by Belgium and shared among the other companies.

Odoo's intercompany transactions feature allows for synchronization of purchases, sales orders, invoices, and vendor bills between companies.

Journal groups in Odoo help generate financial reports without including inter-company entries, which is essential for group reporting.

Analytic tags are used to isolate amounts that need to be reinvoiced between companies, such as shared equipment purchases.

Companies can automatically synchronize vendor bills and customer invoices, streamlining inter-company financial workflows.

Synchronizing sales orders and purchase orders is recommended for managing stock movements between companies.

A customized journal for intercompany transactions can help differentiate between regular business transactions and inter-company activities.

Creating journal groups allows companies to exclude inter-company journals from financial reports, offering clearer insights.

Analytic tags can also be used to manage reinvoices based on percentages, allowing for partial or shared expenses between subsidiaries.

Companies can group analytic items by account or month to ensure accurate reinvoicing at the end of a period.

Odoo allows exporting of accounting items for integration with external software used for group-level financial consolidations.

To generate joint tax reports across multiple companies, a technical parameter needs to be added to enable multi-company tax reporting.

Odoo version 15 will introduce a more streamlined solution for aggregated tax reports, replacing the current workaround.

While it is technically possible to use a unified chart of accounts across multiple companies, it's not recommended due to country-specific financial reporting rules.

Transcripts

hello deodorants and welcome to this new

video about multi-company setup

let's see together what we can do in udo

in order to have

a optimized multi-company environment

so let's talk about the use case first

so that you can keep that in mind when

we talk about the concepts

so fpincars group involves a lot of

interactions between the different

subsidiaries

as their consultant you need to come up

with an easy and fast solution

to manage the enter company workflow so

uh the different companies periodically

reinvoiced each other

for the expenses revenue they share

together and due to the pandemic

fp cars belgium has invested into a

brand new long distance communication

system

for all the subsidiaries the costs are

all paid by

belgium but should be supported by the

three companies

um and they also need to be able to see

the financial reports

without the inter-company entries

so how can you handle multi-company

relationships in ado

well it happens often that companies

within a group reinvoice each other

since they can be partners in their

activities

and group their purchases to save extra

costs

what can we use in urdu well first you

have an intercompany transactions

feature

with which synchronizes uh either the

purchases

and the sale orders or the invoices and

vendor bills

we'll see just afterwards how this works

we also can use the journal groups in

order to provide

uh aggregated financial report without

considering the earned inter-company uh

transactions so it happens a lot that

for group reporting purposes they need

to see

their p l their balance sheet or any

aggregated financial report

but without considering all the

accounting entries

meant for inter-company purposes so

the journal groups are a good way to go

in that case and

lastly you can also use the analytic

tags to identify

which amounts to reinvoice to other

companies because

um it can happen so they they make some

purchases they made some sales

and at the end of the month they see

they need to see the share

that needs to be reinvoiced to uh to

the other company so they make us i

don't know the mother company made some

purchases for some equipments

and they need to split the cost among

the diff

between the different subsidiaries in

that case uh we can use genetic tax to

advantage

in order to find these isolate these

amounts

with the proper share uh out of the

total amounts so that you can

find a way to reinvoice this amount at

the end of the month

so let's do that together in the system

so first

we need to synchronize the different

transactions for the inter company

so this actually super useful um

when uh well you you have difficulties

communicating with other subsidiaries

with other companies

the synchronization will enable you to

uh you know shorten the gap the time

that you have between

the communication between uh company a

and benny b

that's where you see okay when they make

the vendor bill i'll have the customer

invoice on my side

automatically put in draft so you need

to go in the settings

uh from the database and

go down to the inter company

transactions

so you need to select this and save

and you need to do this in multiple

companies in both companies

so you have to solve this first so that

you can

design uh well configure this feature

properly

so once this is activated i need to go

back there

and as you can see i can decide to uh

synchronize

a certain uh certain amount of things so

i can decide to synchronize the invoices

and bills

the sale orders the purchase orders or

both

and i can decide to create those as

any user in the system i'll decide to

put this as

autobots because that way i can identify

them

much easier um

i'm going to save and i'm going to do

the same thing for the belgium

company

because it's company specific so i have

to do this every time for

every new company so here it's activated

but

i can i need to choose the

synchronization

here i choose invoices and bills but

there is also an interest in

synchronizing sales in purchase orders

especially if you have

stock moves inventory movements of

between the two companies

it's actually better to use sale orders

and purchase orders in that case

so once this is done it means that every

time that i create

an invoice or a bill for one of them

then it will

be reflected automatically in uh the

other

in the other accounting so if let me

create a customer

invoice from uh the belgium

um the belgium company to the uk

company let's say

sales inter-company dealt

and i'm going to put 10 000

i'm going to save and i'm going to

confirm

as a result if i get so here i've

confirmed it

i should be able to see in

the uk subsidiary i should be able to

see in my vendor bills

one bill to validate here it's

automatically filled in for me so i

actually don't have to do anything

except validating it

i have the vendor which is the belgian

company

with the proper payment reference coming

from the customer invoice

the bill date the label the proper

account

in that case here is cost of sale but it

could be anything

um you just need to configure it

properly and the right price

and i can confirm and that's it so

this is how the synchronization work for

the inter company flow

afterwards if you need for financial

reporting to

split the uh to you know distinguish

all the transaction for your daily

activities and for your business and

all the transactions for the

inter-company flow in that case what i

advise you to do

is creating new journals for

inter-company

transaction so i'm going to call inter

company sales

so one for sales

for let's put this one and put enter

company

sales or inv like this

i'm going to do the same thing for the

purchases

purchase cost of sales

and

yes liquor let's say vanderbilt

like this okay so i have my two journals

so every time that i

make um an entry in those ones

here i can choose the right journal

and if i decide to put here

fpincas as a vendor on the other side i

have a customer invoice

okay purchase into company

2000

i need to put a build date of course i'm

going to confirm

you'll be able to see of course the

customer invoice on

the belgium accounting side but the good

thing is that after you've made that you

can decide

to create a journal group so food

journal groups is just a way to exclude

journals and

use those groups as filters in the

financial report

so here i'm gonna put uh accounting

without inter company

so here i'm going to exclude the

journals

uh inter company

enter company sales and purchases it

means that

when i'm in the bank sheet for example

uh yes so here i have

a lot of different amounts if i want to

uh select all of uh

here as you can see by default i have

the general groups for

without my intercompany

journals but i can decide of course to

include them

as well i can decide to have everything

and as you can see the amounts have

changed so if i decide to just select

again

my journal groups which is much faster

then in that case

uh as you can see the amount here is

only down to nine

thousand if i decide to add the

purchases

it's up to eleven thousand so it's a

good way to see

in your balance sheets the amounts with

the inter company amounts and without

so this is what you should do

lastly um and this is also the case for

a use case um you don't really

know um on a you only invoice

reinvoice to the other company at the

end of the period

so you need to aggregate all the amounts

that you need to reinvoice and make

one single invoice or vendor bill and

the good way to go in that case is using

analytic tags

with 100 distribution behind this so

here i'm on the uk subsidiary i'm going

to put reinvoice belgium

and i'm going to put uh f pin cars

as a analytic account that way

so it means that whenever i have some

bills

or some customer invoices because they

can also reinvoice

revenue depending on the activities

of the business uh the agreements

between the two companies

so i have a vendor bill i can decide to

put

some purchase of goods

and on the attack i'm gonna say hey on

that side i'm gonna have

the reinvoice to belgium i'm gonna have

120 and this is all meant for belgium so

i need to reinvest a whole lot of it if

you need to reinvest only a part of it

if you have previous agreements you can

make

a distribution for less than a hundred

percent

uh you can split along different

analytic accounts

or if it's a one shot in that case so in

this particular case you only need to

reinvoice half of it

then in that case i would put 60 like

this and make a second line

with no analytic tag and then 60 that

way you can get

the whole uh the whole the total amount

but only a split uh reinvoice amount

of the half of it so here i'm gonna do

this i'm

to do this a second time for our

transport fees let's say

480

like this i'm going to confirm and

that's it

so the hormone goes by i'm gonna have

uh vendor bills i'm gonna have customer

invoices

i can have other employees from the the

company

working for me so i have to they have to

reinvoice to me

their salary and so on so that's how it

works and how

intercompany our company can reinvoice

each other

so at the end of the month what i would

do with my clients is go

in the analytic item and

group by analytic account so here i have

only those two so that's easy

but you have lots of it you can filter

on the proper analytic account

why is it interesting to always have the

analytic account and not only the tags

that's because in that case you can

always group by

and have aggregated reporting so that's

always best to have an itec account

behind it and as you can see if i group

by maybe month

because i want to issue an invoice on a

monthly basis

you see that i have to reinvoice to my

to the belgium company 240 pounds so

this is what i'm going to do i'm going

to make a customer

invoice for 240 pounds

let's call it uh we invoice

for june no it was july

sorry and if you even want to go further

and make sure that you haven't forgotten

anything

you can put reinvoice is in here as well

that way you will create a new analytic

item

and you will put the balance down to

zero that way you make sure

that everything is has been reinvoiced

that you haven't forgotten anything

so here i'm going to put 240 i'm going

to confirm

so in terms of analytic analytic items

what happens

in the analytic items if i group by

analytic account

as you can see the balance is down to

zero because i have

my different bills and my invoice on

that case so

everything has been reinvoiced i don't

have to do anything

if i go back to my uh pink cars

belgium company i'm gonna check in my

vendor bill

as you can see i have uh in revenge of

bills i'm gonna have one

for the uk company

in here it's just that

the the tax is uh not the proper one

but uh it's going to be 240 pounds

i'm going to confirm uh why

can't i confirm it uh no no yeah

it's just because the analytic tag is

not uh it's company specific so i can't

save

but i just need to correct that let's

make that together

let's go in the analytic tags we invoice

b

b e i think that's the yeah

you see as you can see the analytic

account

is related to the other company so i'm

just

gonna have to switch

in here and correct that

to make this one available for everybody

i'm gonna go in uh back in

fp cars

vendor bills check this one

confirm it and we're good to go and

having the tag actually helps as well on

that side because that way you can track

what has been reinvoiced to you as

another company of the group so in my

analytic item

i could see here the analytic account

and

the tag related to it so you can always

also do

reporting on your side

okay that's it for me on how you must

handle your multi-company relationships

let's see the last step which is the

frequently asked question

in the multi-company setup our method

company is handling the consolidated

account of the group

in another software they want to

integrate audio with

its uh with it so that they can have our

accounting entries directly in the

software

is it possible so a lot of uh clients

asked us

that question and we tend to decline

this requirement so we challenge this

by just saying that you can easily

export the accounting

items in order to import them back in

their software

um so if they have a consolidation

software

for the whole group and they want to see

the aggregated amounts for

their accounting along between

throughout the group they need just to

export

the accounting individual items and

import them back

in their software is it possible to have

a joint

tax report for multiple companies yes it

is

uh in standard like with standard

configuration it's not

but you just have to add

a system parameter which is a bit

technical

uh so you need to be in debug of course

and go in the settings

because normally in standard the tax

report is company specific and you will

not be able to aggregate this

however it is possible to do this if you

go

in the technical menu and you go way

down to

the system parameters in here

and you need to create a new one which

is called

let me i always forget what it's called

so let me take

the proper key so

account tax report multi-company and you

need to put the value

in one by doing so you will

enable the tax report to be aggregated

along different different companies

however

you must not do that if your companies

of course come from different countries

it's only interesting

if you have multiple companies within

the same country and

you want to see the aggregated tax

report

in in the next version so in version 15

you'll be able to have what we call in

belgium a unity

v80 initiative um

and this will be the replacement feature

for the workaround that i showed you

because

basically a lot of countries need this

kind of aggregated tax reports so

in the next version we have a proper

feature for that

so in the tax report now so here i have

my values in my tax report

of course here you won't be able to see

anything because if i select

for example the french company nothing

is going to happen here because the tax

grades are not the same

so in my french company

i use different taxes with different tax

tax grids

so of course in here i don't have

anything that's related

in the global summary though i'll have

uh both

french taxes and

belgian taxes as well but with no

structure regarding the tax report

for a country-specific tax report but

it will work if you have multiple

companies in the same country

last question we would like to have a

unique chart of accounts for our two

companies belgium and the netherlands

is it possible energy in that specific

case it

is possible why remember when i talk to

you about the financial reports

uh and on which criteria those are based

on

so for belgium financial reports are

based on the code

so of the account so the number of the

accounts

will make the sort out in throughout the

different financial report lines

rather than for the netherlands it's the

tags that are

on the account that will matter so in

that case

having one chart of accounts is possible

because

you can make sure that your child

accounts for belgium

is uh has the proper codes and on the

other side have the right tax on the

other

on the other side technically speaking

it will still be

two different chart of accounts you have

one for company uh belgium company and

one for the netherlands company

but it when they talk uh when your

client says i want a unique chart of

accounts they say they want the same

account the same

number of accounts the same structure

and so on

i would still not recommend doing this

because every

accounting has for each country has its

specificity so it's

always best to keep two different charts

of accounts

when in certain cases it will not work

so for example if you have one company

for belgium and one company in france

you will not be able to put one unique

chart of accounts

because basically both financial reports

in those countries are based

on the number the digits of the account

and the um terminology of

each accounts uh in belgium and in

france are different

so we're not going to have the same

codes throughout belgium

and france so if you choose one unique

chart of accounts your financial reports

in one of the countries are going to be

wrong

so you always advise you to keep you

two distinct or more chartered accounts

because that's the best way to go it

is possible in certain use cases but i

would still advise you not to do it

that's it for me in this video thank you

all for watching and

let's not see each other in the next

topic because that's the end of this

smart class