A company has three divisions: a U.S. division that covers the U.S. locations, a European division
that covers U.K. and France, and a Middle East division that covers Saudi Arabia and U.A.E. All
the divisions have their own employees. Choose how many Ledgers and Legal Entities the
company Needs.
A.
One ledger and one Legal Entity
B.
Two ledger and two Legal Entities
C.
Three Ledger and three Legal Entities
D.
One Ledger and three Legal Entities
Explanation:
LE(legal entity)Design –Models
* 1:Many(Ledger-Legal entity)
– LE are mapped to the Balancing Segment Value (BSV, aka Companycode) within a Ledger, so
multiple LE are accounted for in a ledger.
– An OU will have one Ledger assigned so transactions for many LE areprocessed and accounted
in a single OU
* 1: 1: 1
– A single LE is mapped to a Ledger
– An OU will have one Ledger assigned
– Therefore an OU only has one LE (that means it is easy to derive the LEgiven the OU)
The 1:M model is recommended and preferred in the US, the 1:1:1 model is recommended for
most nonUS regions.
Note: The Multi Org Structure falls in the below order, i.e.Business Group => Ledger => Legal
Entity => Operating Unit.From Left to Right its ONE TO MANY Relation ship which means …..1BG
can have more than 1 Ledger, 1 Ledger can have more than 1 LE, 1 LE can have more than one
OU.From Right to Left its ONE to ONE Relationship which means …1 OU can point to 1 LE only1
LE can point to 1 Ledger only1 Ledger can point to 1 BG only