I am facing huge problem in understanding consolidation reserve calculation and explaining it to my client.
When ever we run the consolidation there is balance going and sitting in Consolidation reserve account from reserve account.
And some eliminated investment from Retained earning also going and sites in Consolidation reserve account.
First off all i wanted to understand why consolidation reserve account should be there ?
2 .How consolidation reserve will be calculated?
3. Is my actual reserve is some of Reserve + consolidation reserve? or
Is my total retained earning is sum of retained earning + consolidation reserve?
4. If we don't want consolidation reserve to be calculated , how to do the changes in the system.
Actually my client don't want there reserve to get eliminated and consolidation reserve account to have any balance at consolidation .
Please help me with this an urgent basis. Thanks you in advance for all your support.