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Former Member

Appopriation of retained earnings

Hi,

Can anybody help me out to understand how system,

behaves differently for ARE in balance sheet and ARE in

income statement.?

is it mandatory ,that if I selected ARE in income statement

then all my ARE accounts like group adjustments and

minority adjustments should also be income statement

accounts.?

Can I say that I can work with subsequent consolidation

without activating ARE itself ?

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1 Answer

  • Posted on Jan 31, 2008 at 01:05 PM

    The appropriation of retained earnings can either be integrated on the balance sheet or be stated as an addendum to the income statement.

    In the former case, a FS item at the end of the income statement discloses the transfer of the annual net income to the balance sheet.

    In the latter case, the transfer item is located at the end of the retained earnings statement and states the retained earnings.

    Which method is used affects the retained earnings item on the balance sheet as well as the balance to be carried forward.

    For subsequent consolidation in Cons of Investment you should indicate an item accourding to the ARE setting in the Cons Area. Hence if Balance Sheet use Balance Sheet item, if Income Statement us Income Statement item.

    ARE for COI must be configured for Net Income. Bonus Payments and Distribution of Dividends is optional.

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