 

≡
 




 Full Consolidation Entries

1. Elimination of investment in subsidiary

Share Capital
Reserves
Retained Earnings
FVA (Assets ↑ or Liabilities ↓)
Goodwill (if +)
DTA (if FVA -)
Investment
FVA (Assets ↓ or Liabilities ↑)
NCI
Goodwill (if -)
DTL (if FVA +)

2. NCI in profit of THIS year

NCI (P&L)
Profit of the year x %NCI
= if any!
NCI (BS)

3. NCI in profit of a PREVIOUS year

Consolidated Reserves
Increase in Reserves x %NCI
= if any!
NCI (BS)

4. Elimination of (here +) FVA on Asset settled since date of acquisition

Consolidated Result (P&L)/
Retained Earnings (BS)
= FVA
Asset
DTL (P&L or BS)
= tax rate x FVA
Deferred taxes (P&L) / Retained
Earnings (BS)
NCI
= (FVA – DTL) x %NCI
Retained Earnings

5. Elimination of FVA on provision (Liability) settled since date of acquisition

Provision
= FVA
Consolidated Result (P&L)/
Retained Earnings (BS)
Deferred tax (P&L or BS)
DTL
Consolidated result
= (FVA – DTL) x %NCI
NCI
6. Elimination of intercompany LOSS on disposal of PP&E
PP&E
= Consideration
Loss on realization of PP&E
= Net value - consideration
Accumulated depreciation
= until disposal
Deferred tax (P&L)
= tax rate x capital loss
DTL
No NCI if seller = parent company!
NCI (P&L)
NCI (BS)
= (capital loss – DTL) x %NCI
If difference in depreciation
Accumulated depreciation
= Dep(buyer) – Dep(seller)
Depreciation charge
Deferred tax (P&L)
= tax rate x ΔDep
DTL
No NCI if seller = parent company!
Consolidated result
= (ΔDep – DTL) x %NCI
NCI (BS)

7. Elimination of intercompany PROFIT on disposal of PP&E

Gain on disposal of fixed assets
= capital gain
PP&E
= Gross value - consideration
Accumulated depreciation
= sum of DT
DTA
= tax rate x capital gain
Deferred tax (P&L)
No NCI if seller = parent company!
NCI (BS)
= (capital gain – DTA) x %NCI
NCI (P&L)
If difference in depreciation
Accumulated depreciation
= Dep(buyer) – Dep(seller)
Depreciation charge
Deferred tax (P&L)
= tax rate x ΔDep
DTL
No NCI if seller = parent company!
NCI (P&L)
= (ΔDep – DTL) x %NCI
NCI (BS)
8. Depreciation/amortization of (depreciable!) assets with + FVA at date of acquisition
Consolidated reserves
= FVA x %dep x years since
acquisition - 1
Depreciation and amortization
charges
= FVA x %dep (once)
Accumulated depreciation and
amortization
= sum DT
DTL
Deferred tax (P&L)
= 1 year
Consolidated reserves
= N – 1 years
NCI
Consolidated result
Consolidated reserves

9. Elimination of intercompany dividend

Dividend income
NCI (P&L: year N, BS: year N-1)
Reserves

10. Elimination of sales during the year

Sales
Purchases (COS)

11. Elimination of intercompany margin on inventories for THIS year

Sales
= profit margin x goods still in
inventory
Inventories
DTA
= tax rate x previous entry
Deferred tax (P&L)
No NCI if seller = parent company!
NCI (BS)
= (entry 1 – DTA) x %NCI
NCI (P&L)

12. Elimination of intercompany accounts

Accounts payable
Account receivable
Financial debt
Financial assets
Rental income
Rental charge
13. Elimination of intercompany margin on inventories for PREVIOUS year
Retained Earnings
= profit margin x goods still in
inventory
Inventories
DTA
= tax rate x previous entry
Retained Earnings
No NCI if seller = parent company!
NCI (BS)
= (entry 1 – DTA) x %NCI
Consolidated Reserves

14. Impairment test on goodwill

Consolidated profit - Impairment
Goodwill (100%)
Asset concerned
NCI (BS)
= Adjustment on Asset x %NCI
NCI (P&L)

15. Restatement due to depreciation/amortization differences

Accumulated depreciation
= differences between the 2
methods (here Δ+) for past years
Consolidated reserves
Depreciation charge
= Difference for this year
Deferred tax (P&L)
= tax rate x difference for this
year
Consolidated Reserves
= tax rate x CR Consolidated
reserves entry 1
DTL
= sum DT
Consolidated reserves
= (CR Consolidated reserves entry
1 – DTL) x %NCI
Consolidated result
= (CR Consolidated result entry 1
– DTL) x %NCI
NCI
16. Restatement due to different stock valuation (here FIFO to WACV)
Consolidated reserves
= differences between the 2
methods (here Δ+) for past years
Inventories
= Difference for this year
Cost of sales
= DT - CR
DTA
= tax rate x difference for this
year
Deferred tax (P&L)
= tax rate x COS entry 1
Consolidated Reserves
NCI (BS)
= (Inventories entry 1 – DTA) x
%NCI
NCI (P&L)
= (COS entry 1 – Deferred tax
[P&L]) x %NCI
Consolidated reserves
= sum DT