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 Head Office and Branch Accounts 

In some industries, branches of a company sell their goods independently but the accounting for these sales is performed centrally (at the head office). You can represent this type of organizational structure in the R/3 System by using head office and branch accounts.

First you need to create head office and branch accounts. The sales orders are managed in the branch account. The sales and transaction figures, however, are not posted to this account but rather automatically to the head office account. Payments are cleared centrally by the head office, meaning that outgoing payments can be made for several branches in one step, using the head office account.

Link between Branch Accounts and Head Office Account

To link branch accounts to a head office account, you must enter the number of the head office account in the Head office field in the branch account master record. This field is contained in the company code area of the master record.

The head office account can be any vendor account except one-time accounts or branch accounts themselves. Branch accounts and head office accounts must belong to the same company code.

Line Item Display

When you are entering the parameters for line item display, you should note the following: for head office accounts, enter the key

004 in the field Sort key. This instructs the system to display the line items for the head office account sorted by branch. This key is defined in the table for allocation rules.

For more information on line item display and the Sort key field, see

Sorting Line Items

 

Correspondence

You can set up your system to cater for written correspondence with vendors a) for the head office, broken down per branch or b) for each branch individually. If you want to create correspondence (such as dunning notices and account statements) for the individual branches instead of the head office, you have to select the Local processing field in the vendor master record of the head office on the Create Customer: Correspondence screen.

You can also define payment methods in the master records of the branches and head offices. For example, if you want to have certain payment methods for particular branches, enter these in the master records of the branches concerned and do not enter any payment method in the head office master record. If you enter payment methods in both head office and branch master records, all payment methods are possible.