The multiple unit coordination installation allows to handle several legal units when a company consists of more than one legal unit. It can cover divisions in different countries, including the different currencies required. Local currencies can also be used for separate divisions in the same country.
In its simplest form, an M3 company consists of one legal unit (one division). There is one general ledger for financial purpose and there can be an optional number of facilities and warehouses used for physical flows. For many customers, however, one legal unit is not sufficient.
Instead of setting up parallel companies, which would require double maintenance, the MUC structure allows you to set up M3 as a multiple unit coordination installation.
All financial transactions take place at the division level, which means there is one general ledger per division. One or more facilities are connected to each division, and each division in turn is connected to one or more warehouses.
All physical transactions in M3 take place in a facility and warehouse. The connection to the division ensures that all financial transactions will end up in the right general ledger automatically. A sample structure is illustrated below:
Division AAA has one facility with two warehouses. Division BBB has two facilities, each with one warehouse.
Using Divisions and Facilities
Typically each division is a separate legal unit with its own general ledger and finances. It does not have to be set up that way, but the maintenance of the finances becomes easier.
A number of example setups are described below, where divisions and facilities are used for different purposes based on their different roles within a group of companies.
Sales from One Division, Delivery from Another
The case illustrated in the diagram below is used when warehouses in one division sell to customers while goods are manufactured and delivered by another division. Delivery can be made either from a distribution unit or directly from the manufacturing unit. If goods are delivered from a distribution unit, some kind of distribution must take place from the manufacturing unit to the distribution unit.
In this example, there are internal invoices and claims between the divisions. The MUC functionality in M3 takes care of this automatically.
There is no limit to the number of different kinds of units used for these transactions as long the relationships among them have been defined.
Distribution from One Division to Another
This setup is used when a manufacturing or distributing warehouse in one division supplies the sales warehouse in another division with the goods before they are sold. In this case, the transactions involved in the sales to the end customer are not affected by the MUC functionality. Instead the MUC transactions take place only between the units involved.
Example - MUC functionality is not used
The case in the diagram below illustrates a transaction, which takes place within one division with different warehouses/facilities. In this case, no MUC functionality is involved.