Using Flow Hierarchy

FLOW Hierarchy

In consolidation applications the goal is to have a Total Flow Dimension member that is at the top of the FLOW hierarchy.  Balance adjustments in any area are conducted at base level members of that flow and rolled up to the total flow member to examine the closing balance of all accounts. 

In this example we construct a dimension hierarchy as we have shown above for inventory also for the Cost of Goods Sold Account.  That flow is separate and distinct from the inventory flow we have shown, but needs to have the same inventory numbers transferred so that a calculation of the cost of goods sold reduction can be made directly on the BUYERCOGS account.

In our example we have chosen to make adjustments directly on the BUYERINV account and the BUYERCOGS account.  You may want to use the other accounts we showed to separate amounts by purpose.  In order to pursue that example, you will also need to examine and adjust your ACCOUNT dimension hierarchy.

Figure 16. Final Flow Dimension Member Structure for this Example Application