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Handling of leaving entity in BPC Consolidation

1.Conclusion

In method, we can use ‘L’ and ‘D’ to differentiate two different scenarios:

  • ‘L’ (Left at last year-end)
  • ‘D’ (Disposed during the year)In ‘Elimination and Adjustment’ rule, there’s only ONE rule type for Leaving:

  • In ‘Elimination and Adjustment’ rule, there’s only ONE rule type for Leaving:

  • The behavior for ‘L’ type elimination rule works in the same way for both ‘L’ and ‘D’ method, which is to reverse all Balance Sheet accounts (account type = AST or LEQ) with corresponding destination audit ID
  • P&L accounts will not be handled by this type of rule.
  • P&L accounts needs to be handled by generic type rules.

2.Example:

2.1 Period 2009.Dec

Until 2009.Dec, three entities (C2000/C3000/C4000) belong to one group (G_CG2):

 

 

The transaction data for 2009.Dec:

One Elimination rule is defined to reverse the P&L account by the minority ownership percentage (1-POWN):

Please notice that the details rules are set to ‘Periodic Calculation’.

 

Definition of used multiplier, which only works for method ‘Holding’ and ‘Global’:

Consolidation result for 2009.Dec:

The elimination result is saved in the target audit id, AJ_ELIM, with correct amount.

2.2 Period 2010.JanIn next year, 2010.JAN, entity C3000 was sold at the begin of the year:

 

Define a new elimination rule with rule type ‘L’ and target audit id ‘AJ_SOLD’, no details needed.

This rule will only handle the Balance Sheet accounts.

For the P&L rule, add a new line for ‘L’ method which will reverse all P&L amount with a different target flow with YTD basis.

For corresponding multiplier, it only works for method ‘L’ (20).

Consolidation result:

 

  • Balance Sheet accounts for C3000 were 100% reversed in audit ‘AJ_SOLD’ (done by ‘L’ type rule)
  • The opening flow amount was then reclassified to flow ‘F_VARLEAVE’ (done by scope change in elimination)
  • The P&L accounts for C3000 were 100% reversed in audit ‘AJ_ELIM’ (done by generic rule) with different target flow member
  • The P&L accounts for C4000 were partial reversed by ownership percentage

 

2.3 Period 2010.Feb

In 2010.Feb, entity C4000 was sold during the middle of the year.

For P&L rule, add one addition detail line for ‘D’ method to only reverse the P&L accounts after the disposal, which is set with ‘Periodic Calc’ with a different target flow member.

 

The corresponding extra multiplier which only works for ‘D’ method (20):

Consolidation result:

 

 

 

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