Corporation Switch User Manual

Setting Up Consolidation Rules 9-11
Company Cost Center Organization Line Item Balance
12.100 5000-Expense 400
Japan has the balances in the following table. Assume these balances have already been
translated into the parent currency, USD.
Japan's Balances
Company Cost Center Organization Line Item Balance
11.100 1100-Cash 500
11.100 2100-Debt -200
11.200 3000-Equity -500
11.200 4000-Revenue -100
11.100 5000-Expense 300
During consolidation, the consolidation rule will produce a consolidation entry in each
step.
Step 1: Eliminate Investment in Subsidiary
Company Cost Center
Organization
Line Item Balance
11.100 1820 - Investment in
Subsidiaries
-400
The step identifies the balance in Japan with line item 3000 - Equity as the source
balance. It produces a consolidation entry with Line Item 1820 - Investment in
Subsidiaries, whose value is: 0.8 * (-500) = -400. The company cost center organization of
the entry is set to the base organization of the source entity, 11.100.
Step 2: Eliminate Subsidiary Equity