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Automatic Intercompany Settlement Part 2

Automatic Intercompany Settlement Part 2—Configured Hub Method

By Sarah Gavin

Editor’s Note: In her previous article, “Automatic Intercompany Settlement – Part 1”, Sarah

discussed the first two Automatic Intercompany Settlement methods - Hub and Detailed. That

article detailed an overview of each method, provided sample business cases for each method, and examples

of transactions with postings, and also explained multicurrency considerations for each. In this Part 2, Sarah

covers the Configured Hub method, also providing an overview , sample business cases, transaction

examples, and multicurrency considerations. She additionally discusses a “gotcha” with this method that

existed in earlier releases of EnterpriseOne. Finally, Sarah concludes the article and this two-part series with a

discussion about the considerations for Changing the Automatic Intercompany settlement method post go live.

Overview

The Configured Hub method was first introduced into JD Edwards functionality with EnterpriseOne

release 8.11 and World release 9.4. This article specifically relates to how this method works in

EnterpriseOne release 9.1.

The Configured Hub is used when an organization has more complex requirements than what is

simply available with the Hub or Detail methods. These requirements may be that the organization

might need to designate one hub company for certain intercompany settlements, and a different

hub company for another group of intercompany settlements. Similarly, there may be some

organizations where a hub company is required for certain groups of intercompany settlements, but

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Automatic Intercompany Settlement Part 2

another group of companies might need to be able to directly transact with each other without a

hub company. But in these two cases the two subsets of companies should not be able to transact

with each other. The Configured Hub method can meet the need for these two scenarios. In other

words, this method can be used to accommodate non-standard intercompany settlement

methods.

When using the Configured Hub method, the following guidelines apply:

Multiple configured hub company groups can be created

Each company within your organization must be assigned to a configured hub company group

A company can only belong to one company group.

In each company group, you can have only one hub company. You designate the other companies in the hub as member companies. Alternatively, a company group can also be set up to have no hub company, where all member companies which can transact with each other.

If you designate a hub company within a configured hub company group, the following rules apply:

A member company can transact only with the hub company or another member company of the same hub.

Intercompany settlements between any member companies will always go through the hub company.

A hub company can transact with a member company of the same hub, or with another hub company within a different configured hub group.

If you do not designate a hub company in a configured hub company group, the following rules apply:

The member companies can transact with other member companies in their own group.

The company that is on the first line of a journal entry becomes the designated hub for that transaction.

There is no option to be able to transact with companies in other groups, including other groups’ hub companies.

Business Cases

Business cases for using this method:

If your organization has a need for a geographical split. For example, a multinational organization with a head office in the US, and some companies within mainland Europe and the United Kingdom. Some JD Edwards companies have a base currency USD, others have base currency EUR and the final group has a base currency GBP. Your business may require for the subsets of the company to trade exclusively from each other. They may set up three groups of configured hubs: US, EURO, UK.

If your organization has groups of companies that represent different business activities, which must not transact with each other. Examples of these groups of companies could be: Wholesale, Retail, Distribution, and Manufacturing. Four groups of configured hubs could be created: WHOLE, RETAIL, DIST, MANUF.

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