This page is describing the minimum configuration required for a functioning implementation of group accounting
consolidation of investments.
1. Final result or journal at the group level. The consolidation system generates this entry after the minimum configuration done
as shown in subsequent steps. The Excel spreadsheet is a convenient way to view this journal after exporting it from the Corporate
Accountant webdynpro. This entry has not necessarily been audited and no opinion is expressed as to which accounting practices
are followed here. As an aside, business combinations are the least disputed area of disagreement between SEC and EU, who are
governing bodies for GAAP and IFRS, respectively.
1a. Actual journal that triggers the group level posting. This journal is at the posting level 10 which is reserved for standardizing
entries and posts one single journal for adding a new investment using purchase method at the parent company level. C0500 has
acquired C0501 is the economic transaction underlying this journal. Here, it serves as a trigger for generating the consolidation entry
in point 1. Again, this becomes clearer in the subsequent points.
2. Changes in Investments Statement. SEM-BCS provides a rollforward schedule for Changes in Investments. Here, only
the acquisition is shown, but it becomes more informative as additions and divestitures are tracked over time. Again, Excel
spreadsheet can be used in addition to a web or SAPGui report (in either ECC or BW).
3. Changes in Equity Statement. This mini report shows the typical capital or equity rollforward. Since we are dealing with
the simplest use case only one line item is shows which can be easily tracked back to the journal in item 1a. above.
4. Goodwill Statement. Goodwill line item statement is only relevant at the group level or above the local general ledger. Again,
one line item is the absolute minimum required to show the report or statement. It gets created at the posting level 30 when the group
entry is generated by the BCS code.
5. Minimal task hierarchy for COI - Consolidation of Investments. This item shows the minimal task hierarchy for COI.
It contains one additional entity which can be used for testing control and ownership of an entity whose currency is different.
It is beyond the scope of this wiki page to demonstrate currency translation impacts on the reported financial statements.
6. Group chart of accounts. This spreadsheet is generated differently than the reports of financial statements in prior points.
It is the first configuration listing that allows the automatic generation of the group entry. As can be seen, there are required
a lot more items to be used than the ones actually generated during the COI entry. Some of the most important categories
are the (item) type of statement, sign, and movement type.
7. COI Group entry configuration. This item highlights the dimensions or characteristic and one value that need to be populated or
configured to obtain a clean customization check and avoid the "no posting necessary" message in the monitor. Document
type 51 here is used to create the automated consolidation journal entry.
7a. Adjusting journal entry configuration. This item shows a different document type that precedes the group entry and posts at
level 10 or standardization. Calculation base is showing which activities end up driving the consolidation.
8. COI minimal configuration. More COI configuration is contained in the system utilization configuration workbench. The journal
entry listed in the beginning is driven by the purchase method and the equity method setting is in addition. Location of
values in the "Totals database" means that we are using the trial balance of the underlying entities and not the additional entry forms
as provided by the tool.
9. Group entry task configuration. This fragment of configuration shows the associating of the journal entry task
(see item 1a. above) and the document type. Also, the frequency of monthly (5) allows us to run the group entry every month.
In reality quarterly consolidation are performed by many organizations.
10. Corporate structure configuration. This shows the mini ownership structure where the parent entity C0500 owns
the wholly owned subsidiary C0501. The accounting technique of 1 indicate the purchase method which is simpler than the equity
method reserved for ownerships between 20 and 50%.
11. Permanent parameters. Permanent parameters are not unique to consolidation of investments but come in handy when
testing the tool when as many values as possible are defaulted in and do not require additional rekeying of values.
12. Consolidation area configuration. This item, similar to the previous one, is not unique to COI, but rather
shows that one role of investee unit is needed for executing the automated consolidation entry.
13. Consolidation area settings. Consolidation of Investments flag is required before any of the entries or
configuration can be done in the system. It results in new configuration folders like system settings to appear
which are not available when no COI is activated in the system.
14. Data basis configuration. Data Basis configuration serves as a connection between ECC and BW. Here profit center
accounting can be removed to simplify the accounting as it may only be required internally and is not a part of external financial
reporting except when it is used for segment reporting.
15. Data basis link to BW objects. As mentioned in the previous point data basis is the RFC connecting point between the ECC and BW.
The objects are automatically generated in BW when the flag is placed in the this screen. The BW maintenance tasks are
beyond the scope of this wiki page.