The answer is to set up a separate consolidation legal entity and use the Consolidate online process to transfer balances from all subsidiaries. This is correct because Dynamics 365 Finance requires a dedicated consolidation company to aggregate financial data from multiple legal entities, even when they use different charts of accounts and fiscal calendars, as the online process automatically maps and converts balances based on the consolidation company’s settings. On the MB-920 exam, this scenario tests your understanding that consolidation is a separate legal entity, not a report run within an existing company—a common trap is assuming you can consolidate directly in the primary legal entity without first creating a consolidation company. Remember the memory tip: “Consolidation needs its own company, not just a report.”
MB-920 Describe Dynamics 365 Finance Practice Question
This MB-920 practice question tests your understanding of describe dynamics 365 finance. The scenario asks you to isolate a root cause — eliminate options that address a different problem before choosing. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
You are the Dynamics 365 Finance administrator for a multinational manufacturing company, Contoso Ltd. The company operates in three legal entities: Contoso US (US), Contoso Germany (DE), and Contoso Japan (JP). Contoso US is the primary legal entity and consolidates all intercompany transactions. The CFO requires a consolidated financial report that includes actuals and budget data from all legal entities. The company uses shared data tables for customers and vendors across all legal entities. However, each legal entity maintains its own chart of accounts and fiscal calendars. The company recently implemented Dynamics 365 Finance and needs to set up consolidation to meet the CFO's requirements. You need to configure the consolidation process. Which course of action should you take?
Clue words in this question
Noticing these words before you look at the options changes how you read each choice.
Clue: "primary"
Why it matters: Asks for the main purpose or function, not a secondary benefit. Eliminate answers that describe side-effects or partial functions.
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Set up a separate consolidation legal entity and use the Consolidate online process to transfer balances from all subsidiaries.
Option B is correct because consolidating online with a consolidation company is the recommended approach when you need to combine financial data from multiple legal entities into a single reporting entity. This method allows you to set up a separate legal entity (the consolidation company) to store consolidated results. It supports different charts of accounts and fiscal calendars across legal entities, as required. Option A is incorrect because exporting data to Excel is manual and not suitable for ongoing, automated consolidation. Option C is incorrect because the General ledger consolidation process in the consolidation company requires the consolidation company to be set up first; you cannot run it directly in Contoso US without a consolidation company. Option D is incorrect because the Consolidate with import method is designed for importing data from external sources, not for consolidating existing Dynamics 365 Finance legal entities.
Key principle: NAT direction and interface roles matter as much as the IP address mapping. Inside/outside designation controls which traffic is translated.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
✗
Export financial data from each legal entity to Excel and manually create consolidated reports.
Why it's wrong here
Manual export is error-prone and lacks automation.
✗
Use the Consolidate with import process to bring data from each subsidiary into Contoso US.
Why it's wrong here
Import method is for external sources, not for Dynamics 365 legal entities.
✓
Set up a separate consolidation legal entity and use the Consolidate online process to transfer balances from all subsidiaries.
Why this is correct
This method automates consolidation into a dedicated consolidation company.
Clue confirmation
The clue word "primary" in the question point toward this answer.
Related concept
Static NAT maps one inside address to one outside address.
✗
Run the General ledger consolidation process directly in the Contoso US legal entity to include subsidiaries.
Why it's wrong here
Consolidation requires a separate consolidation company; cannot run directly in a subsidiary.
Common exam traps
Common exam trap: NAT rules depend on direction and matching traffic
NAT is not only about the public address. The inside/outside interface roles and the ACL or rule that matches traffic are just as important.
Detailed technical explanation
How to think about this question
NAT questions usually test address translation, overload/PAT behaviour, static mappings and whether the right traffic is being translated. Read the interface direction and address terms carefully.
KKey Concepts to Remember
Static NAT maps one inside address to one outside address.
PAT allows many inside hosts to share one public address using ports.
Inside local and inside global describe the private and translated addresses.
NAT ACLs identify traffic for translation, not always security filtering.
TExam Day Tips
→Identify inside and outside interfaces first.
→Check whether the scenario needs static NAT, dynamic NAT or PAT.
→Do not confuse NAT matching ACLs with normal packet-filtering intent.
Key takeaway
NAT direction and interface roles matter as much as the IP address mapping. Inside/outside designation controls which traffic is translated.
Real-world example
How this comes up in practice
A cloud solutions architect for a retail company is evaluating services for a new workload. The correct answer here reflects best practice for the specific scenario described — not a general cloud recommendation. NAT direction and interface roles matter as much as the IP address mapping. Inside/outside designation controls which traffic is translated. Cloud exam questions reward reading the constraint carefully: the same technology can be right or wrong depending on the use case.
What to study next
Got this wrong? Here's your next step.
Review the four NAT address types (inside local, inside global, outside local, outside global), PAT port overload, and static vs dynamic NAT use cases. Then practise related MB-920 NAT questions on configuration and troubleshooting.
Describe Dynamics 365 Finance — This question tests Describe Dynamics 365 Finance — Static NAT maps one inside address to one outside address..
What is the correct answer to this question?
The correct answer is: Set up a separate consolidation legal entity and use the Consolidate online process to transfer balances from all subsidiaries. — Option B is correct because consolidating online with a consolidation company is the recommended approach when you need to combine financial data from multiple legal entities into a single reporting entity. This method allows you to set up a separate legal entity (the consolidation company) to store consolidated results. It supports different charts of accounts and fiscal calendars across legal entities, as required. Option A is incorrect because exporting data to Excel is manual and not suitable for ongoing, automated consolidation. Option C is incorrect because the General ledger consolidation process in the consolidation company requires the consolidation company to be set up first; you cannot run it directly in Contoso US without a consolidation company. Option D is incorrect because the Consolidate with import method is designed for importing data from external sources, not for consolidating existing Dynamics 365 Finance legal entities.
What should I do if I get this MB-920 question wrong?
Review the four NAT address types (inside local, inside global, outside local, outside global), PAT port overload, and static vs dynamic NAT use cases. Then practise related MB-920 NAT questions on configuration and troubleshooting.
Are there clue words in this question I should notice?
Yes — watch for: "primary". Asks for the main purpose or function, not a secondary benefit. Eliminate answers that describe side-effects or partial functions.
What is the key concept behind this question?
Static NAT maps one inside address to one outside address.
About these practice questions
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These questions test the same concept from different angles. Work through them to make sure you can recognise it however the exam phrases it.
Variation 1. You are the finance system administrator for Contoso Ltd., a global manufacturing company with legal entities in the United States, Germany, and Japan. Each entity uses Dynamics 365 Finance and has its own chart of accounts due to local reporting requirements. The CFO wants to consolidate the financial results of all entities into a single consolidated report at the end of each month. Currently, the consolidation is done manually by exporting data to Excel, which is error-prone and time-consuming. The CFO wants to use the consolidation functionality within Dynamics 365 Finance. Additionally, intercompany transactions between entities are significant, and the CFO wants to automate the elimination of these transactions during consolidation. You need to design a solution that meets the following requirements:
- Use the Dynamics 365 Finance consolidation module.
- Automate the elimination of intercompany transactions.
- Allow each entity to maintain its own chart of accounts.
- Generate consolidated financial statements in the US GAAP format.
What should you do?
hard
A.Define the same chart of accounts in all legal entities and then use the consolidation online functionality to consolidate.
✓ B.Create a separate consolidation legal entity, set up consolidation groups and accounts to map the different charts, and configure intercompany elimination rules.
C.Set up the German and Japanese entities as child companies under the US entity, and then run consolidation.
D.Use Power BI to connect to each legal entity's data and create consolidated reports with calculated columns to eliminate intercompany transactions.
Why B: Option C is correct. To consolidate with different charts of accounts, you must create a consolidation company that uses a chart of accounts for US GAAP, and set up consolidation groups and accounts to map the source accounts. Intercompany elimination rules can be defined to automate eliminations. Option A is wrong because it suggests changing all entities to use the same chart, which contradicts the requirement. Option B is wrong because Power BI is not the consolidation module. Option D is wrong because the consolidation company should not be used for daily transactions.
Variation 2. You are a Dynamics 365 Finance administrator for a company that needs to generate financial reports in compliance with local GAAP. The company has multiple legal entities and wants to consolidate financial data into a single reporting entity. They also need to support multiple currencies and translation adjustments. The CFO wants to use a standard tool that integrates with Dynamics 365 Finance. Requirements: 1) Consolidate financial data from multiple legal entities. 2) Support currency translation. 3) Use a built-in tool. Which feature should you recommend?
easy
✓ A.Use the Consolidations module with currency translation settings.
B.Set up Budgeting with exchange rates.
C.Use Financial reporting with row definitions that sum across companies.
D.Configure Intercompany accounting to post balancing entries.
Why A: Consolidations in Dynamics 365 Finance allow consolidation of multiple legal entities with currency translation. Financial reporting is for individual reports. Budgeting is for planning. Intercompany accounting is for transactions. Option A is correct.
Last reviewed: Jun 21, 2026
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