The methods for the consolidation of investments (C/I) define how the consolidation of investments treats goodwill, negative goodwill, hidden reserves/contingencies (fair value adjustments) etc.
For each C/I method, you define which accounting technique is used.
You assign the C/I methods to the consolidation units. If a consolidation unit belongs to multiple consolidation groups, it is also possible to assign different C/I methods to such a consolidation unit, that is, one method for each consolidation group.
The FI-LC System supports the following consolidation of investments methods:
The following consolidation variants are available:
Each case offers various options for the treatment of hidden reserves (fair value adjustments) and goodwill.
Goodwill can be capitalized and amortized, or be directly eliminated against the appropriations.