Consolidation

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Posted on by binitshah

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Hi Friends,

We are having 3 legal entities.

1 in US both accounting and reporting currency is USD.
2 Company in India - Accounting and Reporting currency is INR and USD Respectively.

3 Consolidation and Elimination company - Accounting and Reporting currency is INR and USD Respectively

We have an investment from Indian Entity in US entity of 1000 USD as on 01st January at the time the rate was 65 INR per USD.

So the accounting entries are as follows:

India
Investment in US - 65000 INR DR

To Bank A/c - 65000 INR CR

USA

Bank A/c - 1000 USD DR

TO Share Capital - 1000 USD CR

Assuming there were no transactions throughout the month, at the month end when we revalue the books of accounts. My Share Capital of USA should get knocked off against investment of India.

The problem is In India also there is s share capital of 100000 INR

How to Perfom this transaction in consolidation and elimination.

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Sten Baumgarten 10 on at

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RE: Consolidation

Hi DAX_BinitShah

You shall eliminate the investment in US against the share capital in USA. Your investment can be increased or decreased if your company in US have an income. If yes I assume that you post the US income in your India company (in P&L the income and on the investment as an increase or decrease in the invested value equal to the US income.

Kind regards

Sten