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Odoo for holding companies
Your whole group structure in one database.
We wrote this page for the group’s chairman and its chief financial officer. It explains how the parent company, its companies and their branches are built in Odoo, how the transactions between them are recorded, and how the consolidated report comes out of the very entries that each company’s accountants post.
How a group grows
A group grows company by company, and its figures drift apart at the same pace.
The story usually starts with a single trading company. An opportunity appears in contracting and a company is set up for it, then a property company to hold the assets, then a factory to make part of what used to be imported. Each company is a legal entity with its own accountant and the software that was chosen at the time, and every one of those decisions was sound when it was made.
What changes is the arithmetic at group level. Every new company deals with every company that came before it: two companies share one relationship, five companies share ten, and each relationship carries a current account whose balance should agree on both sides.
What happens to the figures then
- Group sales look larger than they are, because what one company sells to its sister enters the total as if it were a sale to an outside customer.
- The “due from sister companies” balances build up year after year, and explaining the difference between the two sides becomes a task of its own at every close.
- Cash is spread across banks, cash boxes and two currencies, and finding out the group’s cash position today takes a round of phone calls.
- A single customer owes money to three of your companies, and their credit limit is assessed in each company separately.
The structure in Odoo
The group, then the companies, then the branches and warehouses.
Your group’s structure is built in Odoo on three levels inside a single database. Each company has its own legal identity, entries, balances and close, and an authorised user moves between companies from the same menu with a single login.
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The group The parent company and what the companies share
This level defines everything that should be the same for everyone, and it is where the figures of the whole group are read.
- Unified chart of accounts
- Customers, suppliers and products
- Approved exchange rates
- Users and roles
- Consolidated reports
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The companies A legal entity for each company
Each company keeps what sets it apart before the authorities, the banks and the auditors.
- Separate books
- Base currency
- Financial year and closing periods
- Document numbering sequences
- Bank accounts and cash boxes
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Branches and warehouses Where the daily work happens
A branch belongs to its company and posts to that company’s books, and its results can be reported on their own or within the company.
- Branches in the governorates
- Warehouses and storage locations
- Points of sale
- Cost centres and projects
- Local access rights for each branch team
One database means one definition of the customer, the product and the account, and it means a transaction between two companies is recorded on both sides at the same moment.
One transaction, from start to finish
A sales invoice in one company, a vendor bill in its sister company, and zero in the consolidated report.
The trading company in your group sells building materials to the contracting company. Follow that transaction through the figure: it is entered once, recorded in the books of both companies, then eliminated from the group’s figures because it never left the group.
The seven mechanisms
Seven mechanisms that turn several companies into one group.
Multi-company is part of standard Odoo. Our work is to set these mechanisms to your group’s make-up and policies, and to develop what you need on top of them.
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Inter-company transactions
For each pair of companies that trade we define a rule for what passes between them: a sales order in one creates the purchase order in the other, an invoice creates the matching bill, and goods move between their warehouses. Entered once, both sides stay in agreement.
Decided with you Which documents are generated automatically, who reviews them, and at what price goods move between the two companies.
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Consolidated reports and inter-company eliminations
The consolidated report reads the companies’ posted entries directly, so it changes the moment an entry changes anywhere. Inter-company dealings get their own accounts, eliminated on consolidation, with a statement showing any inter-company balance still waiting for its counterpart.
Decided with you The reporting currency, how partly owned companies are consolidated, and whether results are broken down by company or by sector.
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Dinar, dollar and revaluation
Each company has its base currency, and every transaction is recorded in its actual currency at the rate of its date. On payment Odoo posts the realised exchange difference, and at period end it revalues open foreign-currency balances.
Decided with you The source of the exchange rate and how often it is updated, the difference accounts, and the conversion rate in the consolidated report.
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Shared master data
A supplier that three of your companies deal with is defined once, so its balance is visible for each company and for the group, and the same goes for customers and products. Where separation is needed, a record is tied to one company alone.
Decided with you Who may create a supplier or a product, what is shared and what belongs to each company, and the coding rules.
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Access by role and company
For each user we set the companies they are allowed into and their role in each app: a company accountant works inside their own company, the group CFO opens them all together, and the external auditor views one company read-only.
Decided with you The access matrix in each company: who enters, who reviews, who posts, and who only views.
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Cross-company approvals
Some decisions reach beyond a single company: a purchase order above a certain limit, or a transfer between two companies. We configure the approval flows, so the request reaches the decision-maker in the company and then in the group, and every approval stays on the document.
Decided with you The amount limits, the sequence of approvers in the company and in the group, and who stands in for someone who is away.
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From the consolidated figure to its document
From any figure in the group report, management goes down to the company, then the journal entry, then the invoice or payment voucher that created it. This is what the CFO needs when asked in a meeting why a figure moved.
Decided with you Which dashboards open for management, and which indicators appear on them for each company and for the group.
Codeator is an independent company within the Sanarise network, and the network’s experience in multi-company Odoo for holding companies is present in every structure we design.
A staged rollout
We design for the whole group, and go live with one company.
Decisions that affect the whole group are taken once, at the start: the unified chart of accounts, the inter-company rules, the currencies and the access rights. After that, go-live proceeds company by company, and your team and ours carry what each stage teaches into the next.
The group on paper
We document the companies and what passes between them, and agree the chart of accounts and the shared data before any screen is opened.
The first company
Together we choose a company that represents the group’s kind of work and whose team is ready. It moves to Odoo with its opening balances and runs on it for real.
The remaining companies
Each company is created on the existing structure, so it inherits the chart, the data and the access rights, and its inter-company rules are switched on with the companies that went before it.
Group reporting
Once the companies are in, we launch the consolidated reports and management dashboards, and compare the first consolidated close with what used to be prepared by hand, so that you can trust the figures.
The detailed stages of our work, and our support services after go-live, are on the services page.
Group make-ups we see in the Iraqi market
Each company in the group has its own line of work, and one structure holds them all.
Two holding companies are rarely alike, yet their components recur: trading and imports, contracting, property, industry, retail, and a head office that serves them all. Each component has its apps in Odoo, and all of them post to the same accounting structure.
Trading, imports and distribution
Contracting and projects
Industry
Retail and branches
Property and assets
Head office and shared services
To follow customers and sales opportunities at group level, see the Sales & CRM page, or browse all solutions.
The CFO’s questions
What gets asked before the decision is signed.
Questions that come up again and again in design meetings with the finance departments of holding companies. What concerns your group in particular, we answer in the consultation.
Can an external auditor, or a partner in one of the companies, see their own company alone?
Yes. Each user is granted the companies they are allowed into, so the auditor or partner enters one specific company with view access and finds its complete books there, from the journal entry down to the document, while the group’s other companies stay outside the scope of their account.
In some companies we hold a partial stake, alongside partners from outside the group. How do they appear in the consolidated reports?
At the design stage we settle with you how each company is consolidated: in full, showing the other partners’ share, or in proportion to ownership. We then configure the consolidated report on that basis, in line with the accounting policy adopted by the group and its auditor.
Some of our companies will stay on their current system for a while. Is the consolidated report incomplete during that time?
The report stays complete. During the transition, the balances of the companies that have not yet moved are imported from their monthly trial balance and recorded in their company inside Odoo, so the consolidated report reads every company from one place. Detailed entries then replace the imported balances as each company moves over.
What does it take to add a new company that the group founds or acquires later?
The new company is created on the existing structure, so it inherits the unified chart of accounts, the shared data, the inter-company rules and the access rights. The work then centres on its opening balances, the apps its business needs, and training its team.
We start from the map of your group: the companies, the currencies, and what passes between them.
In the first consultation we listen to how the group is made up and how it closes its books today, and we show you how its structure is built in Odoo and which company it makes sense to start with.