The Group Structure of Consolidation Group Europe
In this unit, we will focus on our Purchase and Equity Method scenario on extraordinary amortization of positive goodwill and check the elimination results when executing the 2101 - Cons. Of Invest. (Act.-Based) task in the consolidation monitor. After that, an impairment posting occurs per consolidation group.
The first lesson of this unit refers to the Purchase Method scenario. The lesson explains the elimination results for consolidation unit DM00 - Denmark, which is consolidated into consolidation groups Europe and World, starting with consolidation group Europe.
Using the Consolidation of Investment Method 12 - Purchase Method (Direct Shares-ExtAm)
After executing the 2101 - Consolidation Of Investments (Activity-Based) task, the posting of goodwill to investee DM00 - Denmark is positive.
Consolidation method 12 - Purchase method (Direct Shares - ExtAm) is assigned to consolidation unit DM00 in the group structure of group Europe and World. Consolidation method 12 - Purchase method (Direct Shares - ExtAm) has the setting Extraordinary amortization for positive goodwill.
Data Reference for C/I Results
Local Close Data of SW00 - Switzerland in Group Currency EUR
In this lesson, we will look at the local close data in group currency EUR to easily follow the calculation of the elimination results.
For the following calculation, note the investment of EUR 1650 of the investor SW00 - Switzerland, posted on the 172100 - Investments in subs JV and associates GV FS item.
Local Close Data of DM00 -Denmark in Group Currency EUR
For the calculation, note the investee DM00 - Denmark, the 311000 - Issued Capital and 316000 - Retained Earnings (prior year) equity items, the 317000 - Net Income FS item (which is the Retained Earnings Current Year FS item), and the799000 - Net Income/Loss P&L FS item.
Consolidation Group EUR: DM00
First Consolidation
The following video explains how to derive elimination postings for the first consolidation for consolidation unit DM00 -. Denmark in consolidation group Europe.
Summary: In this video, we covered how to calculate goodwill for consolidation unit DM00 - Denmark, and how the elimination postings are calculated from a business point of view. Due to theExtraordinary Amortizationsetting in the consolidation method, the positive goodwill automatically posts to the asset FS item 163100 - Goodwill.
Consolidation Group EUR: DM00 – First Consolidation Task Log
In the Document section of the task log, you can check the elimination postings set up for the first consolidation from a debit-to-credit perspective.
Subsequent Consolidation
On the first of December 2025, the investor bought the Consolidation unit DM00. Consequently, the consolidation unit generates profit during this month since we did not select First Consolidation at the End of Period in the Group Structure settings.
Item 317000 - Retained Earnings Current Year contains this profit of 60 euros. This profit runs into the first subsequent consolidation in period 12 of 2025 and triggers the calculation of 24 euros as a posting of minorities. Since this is a P&L- relevant activity, the earnings effect automatically executes.
Subsequent Consolidation Task Log
The figure above shows the calculation of minorities in FS item 317000 Retained Earnings Current Year, along with resulting closing of the P&L statement and the earnings effect on the balance sheet. See how the log also reflects these changes.
Consolidation Group World in the Group Structure
The second part of this lesson checks the results for consolidation unit DM00 - Denmark in consolidation group World.
Consolidation Group WORLD: DM00
First Consolidation
The video below derives the elimination postings for investee DM00 - Denmark in consolidation group World. You will get the same posting results for the consolidation group Europe.
Note
With extraordinary amortization, no postings occur for minorities in goodwill on the level of consolidation group World, since with extraordinary amortization, the goodwill is directly activated on asset FS item 163100 - Goodwill. Minorities only post to equity FS items, not to asset FS items!First Consolidation Task Log
The task log for the first consolidation of consolidation unit DM00 - Denmark in the consolidation group World shows the elimination postings and the activated goodwill in the Document section of the task log.
Subsequent Consolidation
In consolidation group World, similar to the subsequent consolidation of consolidation unit DM00 in consolidation group Europe, the profit of this consolidation unit (FS item 317000 - Retained Earnings Current Year) runs into the first subsequent consolidation in period 12 of 2025. This occurrence triggers the calculation and posting of minorities. In this group, there is a group share for minorities in equity FS items of 46 %.
Since this is a P&L-relevant activity, the earnings effect automatically executes.
Subsequent Consolidation Task Log
The task log of the subsequent consolidation shows the elimination postings and the Closing P&L & Earnings Effect in the Balance Sheet from a debit-to-credit perspective.