| adjustment to retained earnings (EC-CS) |
An adjustment to retained earnings occurs only if the appropriation of net income is located after the income statement.
The adjustment automatically generates two line items: one posts to the retained earnings item in the balance sheet, and the other posts to the transfer item for net income at the end of the income statement.
When a document is posted, an automatic adjustment is made only if the balance of all (normal) line items referring to the balance sheet is not equal to zero; The balancing entry is then made to the balance sheet.