Zero Balance Segment Reporting

[minakshi_karan]

Hi,

How to achieve zero balance segment reporting and then how it achieves the objectives of management? What is the role of segment then?

Thanks

[Former Member · Accepted solution]

let us assume you have your balance sheets drawn out of 2 segments (A,B)   Lets take a normal JE,   Dr XXX1 Acct segment A            Cr XXX2 Acct Segment A   Your balance sheets will be balanced wherever these accounts fall, meaning you will ve a corresponding debit and credit entries seen in your balance sheet accounting for the activity for a segment.   Now assume a scenario, where you have a JE,   Dr XXX1 Acct segment A            Cr XXX2 Acct Segment B   In this scenario, your segment A balance sheet will show a Debit of X amount with no corresponding Credit entry and vice versa on Segment B.   To balance such activities, is the purpose of a zero balance account and the line items.

[minakshi_karan]

Hi,

Also please clarify that what should be nature of Zero Balance Account i.e. if it will be recon account and what will be its sort key.

Thanks..