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Function documentationBalance Carryforward with "Different" Locations of Equity Data

 

When you consolidate investments and have the system read the equity data from both the totals data and the additional financial data, the system uses this function to ensure that the equity data records remain consistent when balances are carried forward.

Prerequisites

You have made the Customizing settings for consolidation of investments and balance carryforward.

Features

When consolidation of investments reads the equity data from both the totals data records and the additional financial data, the balance carryforward function must proceed as follows:

  • The balance carryforward function that reads data from the additional financial data must also take account of the totals records that are to be carried forward. All equity items that are not read from the totals data must also be copied over to the additional financial data during the balance carryforward. Otherwise, a subsequent validation would discover inconsistencies between the totals data and additional financial data.

  • All equity items that are read from the totals data need to be deleted from the additional financial data during the balance carryforward. If the balances of an equity item that is contained in the additional financial data are carried forward to a different item that is to be read from the totals data, the latter item must therefore be deleted from the additional financial data during the balance carryforward.

By default, the system only uses this special logic for units that use the purchase method. In the configuration of balance carryforward tasks, you can also activate the special logic for equity-method units. If you do this, you must then also enter the reported equity for equity-method units in the totals database. Otherwise the system does not carry forward the equity in the reported financial data.

Example

You state your appropriations of retained earnings in the balance sheet. You want to translate the appropriation items Transfers to Appropriations and Deductions from Appropriations (including their subitems) using historical exchange rates. For this reason, these items are recorded in the additional financial data and are translated historically. They are carried forward to the appropriation item Annual Net Income – Prior Years.

To meet our purposes, rather than being recorded in the additional financial data, Annual Net Income –Prior Years is read directly from the totals data and is not translated.

Once the balances have been carried forward, this function makes sure that no values are left on the Annual Net Income – Prior Years item.