A journal entry used for adjusting the reported financial data so that it meets the standards required for the corporate group.
Standardizing entries can be made to the reported financial data decentrally by the individual company being consolidated. However, often the standardizing entries required from the group point of view are not known to the consolidation unit.
If the consolidation unit reports its data in local currency, then the standardizing entry is also be made in local currency.
The reported financial data and the standardizing entries are then translated into group currency during the currency translation process.
In the Consolidation system, standardizing entries are stored in separate data records in addition to the reported financial data. This is to allow for independent analysis of the data at any time.
Standardizing entries that simultaneously post amounts to balance sheet items and income statement items can cause an adjustment to net income, in which case the Consolidation system automatically calculates the adjustment amount. This can lead to an allocation of deferred income taxes.
A journal entry made to the financial data of companies being consolidated, in order to bring this data into line with corporate standards.
Standardizing entries can be made locally by the individual subsidiaries, however, the standardizing entries required from the group point of view are not known to the subsidiary, and are therefore only made in the Consolidation system.
If the subsidiary reports its data in local currency, then the standardizing entry will also be made in local currency.
The individual financial statement data and standardizing entries for the subsidiary are then translated into group currency during currency translation.
In the FI-LC System, standardizing entries are stored separately from the reported financial statement data in special data records. This makes it possible to analyze each type of data separately.
Entries which post to both the balance sheet and income statement can cause an adjustment to net income that is calculated automatically in the Consolidation system. This can lead to the allocation of deferred taxes.