Enterprise Structure Components
Infor LN's enterprise model has three key components: the enterprise structure defining legal entities and their relationships, logistic companies handling operational transactions (orders, inventory, production), and financial companies managing accounting, consolidation, and reporting. A single financial company can serve multiple logistic companies, or each logistic company can have its own financial company. The choice depends on legal structure, reporting requirements, and operational independence.
- Define legal entities first, each legal entity typically maps to one financial company for statutory reporting
- Map operational sites to logistic companies based on inventory ownership and production independence
- Use shared financial companies when legal entities share a chart of accounts and consolidation is straightforward
- Document the enterprise model as a diagram showing all company relationships before configuring LN
Intercompany Design Patterns
Intercompany transactions in LN automate cross-entity business processes: intercompany sales, purchases, inventory transfers, and financial settlements. The design must account for transfer pricing compliance, intercompany elimination for consolidation, and the operational efficiency of intercompany order processing. Common patterns include hub-and-spoke (central distribution entity), direct peer-to-peer, and hybrid models combining both.
- Choose hub-and-spoke for centralized inventory management with one distribution entity serving all sites
- Use peer-to-peer for autonomous operational entities that trade directly without central coordination
- Configure intercompany transfer pricing rules that comply with local tax regulations and arm's-length principles
- Automate intercompany settlement and elimination entries to streamline consolidated financial close
Modeling for Growth and Change
Enterprise models must accommodate organizational change: acquisitions, divestitures, new plant openings, and legal restructuring. Design with flexibility by keeping the model as simple as current requirements demand while documenting the expansion path for likely scenarios. Avoid over-modeling for hypothetical future structures, unnecessary complexity increases implementation time and ongoing maintenance without delivering current value.
- Design for current requirements but document the expansion path for planned acquisitions or new sites
- Keep the model as simple as possible, every additional entity increases configuration, testing, and maintenance
- Plan the process for adding new logistic companies without disrupting existing operations
- Test the consolidation and reporting impact of model changes in a sandbox before applying to production
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Infor LN Company and Enterprise Unit Design Worksheet
Plan LN companies, enterprise units, sites and currencies row by row, with user and volume totals, and export to Excel.
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