Supporting Organizations are best setup with a separate Division code.  This will allow segregating them in Fund Statements, 990 and 1099 reports, as well as other financial reports.
You may also want to use the GL Overrides tab on the fund to choose an alternate cash account for gifts and grants, etc.

There are several things to keep in mind:
  • ​Unless you are reporting on the combined entity, all reports will need a Division filter. You can set up saved defaults with a division filter to make reporting easier.
  • There is no way to segregate the view of the database. i.e. Someone working on the data probably will have visibility to your data as well
  • Donors and Vendors will probably be used by both entities and thus separating the data later might prove impossible.
  • The same chart of accounts will be used by both although some accounts might/will be unique to each.
  • Interfunds are transactions within the same entity.  Thus, transfers between these organizations will probably involve a regular gift and grant.