Retained Earnings

To adjust the amount of the retained earnings account, do not enter an adjusting entry. This can cause undesirable results. Instead, create a new account with the same business unit and object of the retained earnings account and a new subsidiary.

You can close more than one company to a single retained earnings account. This is necessary if corporate divisions are set up as companies. You close these divisions to a single retained earnings account to consolidate reporting for the legal corporate entity.