Multi-Entity AR Operations

#Multi-Entity Concepts

In a multi-entity setup:

• Company: Your top-level organization
• Entities: Legal entities or subsidiaries (e.g., Light US Inc, Light Europe GmbH)
• Ledger: GL account structure specific to each entity
• Currency: Each entity can have a different functional currency

Customers exist at the company level but are assigned to specific entities for invoicing.

#Setting Up Multi-Entity Customers

#Creating Customers for Specific Entities

1. Create the customer at the company level (visible to all entities)

2. Open the customer record

3. Navigate to Entity Assignment

4. Click Assign to Entity

5. Select the entity

6. Optionally, set Entity-Specific Details:

   • Different billing address per entity
   • Entity-specific contact
   • Entity-specific payment terms

7. Click Assign

Customers can be assigned to multiple entities if they do business with each.

#Entity-Specific Customer Information

Some details can vary by entity:

• Default Currency: Each entity has its own functional currency
• Payment Terms: Entity-specific terms
• Billing Address: Can differ if entity has different mailing address
• GL Accounts: Revenue accounts specific to each entity

Set entity-specific overrides when assigning customers.

#Invoicing Across Entities

#Selecting the Correct Entity

When creating an invoice:

1. Click Create Invoice
2. Select the Customer
3. Light shows available entities (only those the customer is assigned to)
4. Select the Company Entity
5. The invoice currency defaults to the entity's functional currency
6. Continue creating the invoice

If a customer is assigned to only one entity, the entity is pre-selected.

#Inter-company Invoicing

When one entity sells to another (internal transfer):

1. Create the invoice normally to the internal customer
2. In the invoice, mark Intercompany Transaction
3. Light creates offsetting entries in both entities' GL
4. Buying entity sees an AP record; selling entity sees an AR record
5. Both are linked for reconciliation

Intercompany transactions help consolidate and eliminate during period close.

#Multi-Currency Transactions

#Invoicing in Foreign Currency

1. Open or create an invoice

2. Select Customer and Entity

3. Light defaults to entity's functional currency

4. Click Currency to override

5. Select a foreign currency

6. Light calculates the FX rate:

   • Default: Current mid-market rate from data provider
   • Override: Enter a specific rate for this invoice

7. Amounts in the foreign currency are displayed

8. GL entries record both local and foreign amounts

#FX Rate Overrides

Override default FX rates:

1. When creating or editing an invoice, find FX Rate
2. Click Override Rate
3. Enter the FX Rate (units of local currency per foreign currency unit)
4. Optionally, select the Source (e.g., customer quote, internal policy)
5. Click Apply

Use overrides to match customer's local exchange rate or historical rates.

#Foreign Exchange Adjustments

As FX rates move, realized/unrealized gains/losses occur:

1. Navigate to FX Adjustments in AR

2. Light identifies invoices with FX exposure

3. Review calculated adjustments

4. For invoices you're about to settle:

   • Lock in current FX rate by recording payment at actual settlement rate
   • Light automatically calculates gain/loss

5. Click Post FX Adjustment

6. GL entries record realized gain/loss to FX GL accounts

#Consolidation and Reporting

#Consolidated AR Views

View combined AR across all entities:

1. Navigate to Reports > AR Summary

2. Click Consolidation

3. Select scope:

   • Company: All entities combined
   • Specific Entities: Multi-select
   • Currency: View in company currency or each entity's local currency

4. Light shows:

   • Total outstanding by aging bucket
   • Largest customers (consolidated)
   • Outstanding by currency
   • Entity-by-entity breakdown

5. Export to Excel for further analysis

#Intercompany Elimination

View and manage intercompany AR:

1. Navigate to Intercompany Transactions

2. Filter to AR type (invoices from one entity to another)

3. View matched pairs showing:

   • Selling entity's AR
   • Buying entity's AP
   • Status (matched, unmatched, in dispute)

4. Click into a pair to view GL entries in both entities

#Customer Credit Management Across Entities

A customer with credit from one entity may be invoiced by another:

1. Open the customer

2. Navigate to Credit Balance

3. View credits by issuing entity

4. When creating a new invoice in a different entity:

   • Light shows available credits from other entities
   • You can apply cross-entity credits manually
   • GL records credit movement between entities

5. Approve cross-entity credit applications if required by your policies

#Tax Compliance in Multi-Entity

Different entities have different tax requirements:

1. Navigate to AR Settings > Tax Configuration

2. For each entity, set:

   • Primary Tax Engine (for calculating invoice tax)
   • Tax IDs (VAT number, etc.)
   • E-Invoicing Networks (if applicable)

3. When invoicing, Light applies the correct entity's tax rules

4. E-invoice submissions are made on behalf of the correct entity

#Related Articles

• AR overview
• Setting up customers and contacts
• Invoice generation and customization
• Tracking payments and outstanding balances