A holding company with three independently managed and operated subsidiaries is implementing Dynamics 365 Finance. The company needs to ensure the restriction of data for each company from subsidiary

Question

Options

• Asingle legal entity with security policies
• Bseparate legal entities
• Csingle legal entity with custom business unit financial dimension
• Dsingle entity that consolidates legal entities
• Esingle legal entity with default business unit financial dimension

• A
  13% (7)
• B
  74% (40)
• C
  7% (4)
• D
  4% (2)
• E
  2% (1)

Explanation

In Dynamics 365 Finance, a legal entity is the fundamental unit of data isolation. Each legal entity has its own chart of accounts, financial data, transactions, and access controls. For three independently managed and operated subsidiaries that must restrict data from one another, separate legal entities is the correct structure - it provides true data separation enforced at the platform level. A single legal entity with security policies (A) or business unit dimensions (C, E) does not provide the same level of data restriction, as financial data would still reside in a shared structure where cross-entity visibility is possible. Consolidation entities (D) are for reporting only, not operational data isolation.

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