Group, Business Entity, Business Unit and PC Center

Some organizations have fairly complex share holding structure. A holding company could have a few subsidiaries that owns each other in various percentage of equity. A group, refers to consolidated entity of multiple companies that are defined as "Business Entity".

Even though in most cases, each "Business Entity" only has one balance sheet, but there are some large organization that would like to have a balance sheet for each Profit and Cost Center for management purposes. Based on the hierarchy of how Wavelet define the organization structure, Group is at the highest level, and Business Entity is the legal entity of the business being registered,while business unit is like the departments within this Business entity, and each of the business unit may have multiple Profit and Cost Centers (PC Center).

Having said that, for Small and Medium Businesses, most of the time, there's only one business entity with only one business unit and only one PC Center. This is because the company does not need more than one balance sheet. Having more than one balance sheet may create problems when transactions cross between one PC Center to the other, because strictly speaking, if each PC Center has a balance sheet, cross PC Center transactions could only be carry out like a supplier and a customer.

To date, Wavelet does not have the features and functions to automatically cross out internal company transactions within a group to generate a consolidated account for the group or business entity yet. But with the sound structure in place, we do not rule out the possibilities of having this feature in the not too far future.

To define Business Entity, Business Unit and PC Center, goto DEVELOPER module.