Entity management software maintains information about legal entities, such as ownership, officers, registrations and filing obligations. Finance teams also use the term when looking for a system to run accounting across several companies.
Those needs overlap, but they are different buying projects. A legal entity directory does not by itself produce consolidated accounts. A shared ledger does not by itself maintain every corporate filing or governance record.
Are you solving a legal or an accounting problem?
Start with the question people struggle to answer:
| Question | System or process to evaluate |
|---|---|
| Who is a director of this subsidiary? | Legal entity records and governance administration |
| Which corporate filings are due? | Filing obligations, responsibility and reminders |
| What did the group spend with this supplier? | Accounting records across the relevant entities |
| How do the subsidiaries combine into the group result? | Consolidation, mappings and adjustments |
Corporate administration and financial accounting can share an entity register while requiring different software. A list of companies in a finance platform does not establish that it handles director records or corporate filings.
A group may need both. Assign ownership of each record and decide how changes reach the other system. A new subsidiary can affect bank access, accounting configuration, reporting and legal obligations at different points in time.
For the accounting selection, use the multi-entity accounting software guide. Keep legal administration requirements in the brief so the team does not assume a finance platform covers them automatically.
What information does finance need for each entity?
Maintain a clear entity register with the legal name, registration details, ownership, jurisdiction, functional currency, reporting calendar and responsible contacts. Record where the authoritative evidence lives.
Then map the operational setup: bank accounts, customer and supplier records, approval authority, tax configuration and reporting requirements. Changes to those records may need different approvals.
Use a stable entity identifier across integrations and reports. Similar trading names can otherwise cause an invoice or bank account to attach to the wrong company. A clear naming convention helps, but it should not carry the whole control.
How should accounting work across entities?
A common chart of accounts or a controlled mapping makes group reporting easier to maintain. Reporting dimensions can distinguish department, product or market without creating a new account for every combination.
Legal entities still need distinct accounting records and appropriate access controls even when one platform holds the group. Shared software does not remove those boundaries.
Test intercompany accounting and financial consolidation separately. Recording a transaction between subsidiaries and eliminating its effect in group accounts are related steps with different purposes.
What happens when the group adds another company?
Ask the vendor to demonstrate a new entity using the structure you expect to need. Check which master data the team can share, which settings remain local and who can authorise the change.
Include an acquisition with a different chart of accounts in the conversation. The group may need a transition period with separate systems, controlled mappings and an agreed close calendar. A credible design should describe that period as well as the eventual target setup.
Where does Light fit?
Light addresses the finance side through multi-entity accounting and consolidation. Evaluate it against the group's accounting, reporting and workflow needs.
If the immediate requirement is a corporate records database or a filing calendar, define that scope independently. Choosing the right category first prevents a long evaluation of a product that solves a neighbouring problem.
