Calculating Retained Earnings for the AC Ledger

As part of year-end processing, you must calculate retained earnings for the consolidation ledger (usually AC), which is used for balance restatement.

You should follow certain steps to ensure that the AC ledger is in balance and that the calculated amount for retained earnings is correct. If you follow the steps, the Annual Close program (R098201) creates a hybrid historical rate instead of a manual calculation when it calculates retained earnings for the AC ledger. These steps are supported by Global Support Services:

1. Verify that the AAI item GLG4 for the retained earnings account is set up.

2. On the Revise Company Currency Conversions form, create a separate line for the Retained Earnings account (as specified in AAI item GLG4) and enter:

   • The retained earnings account in the From Account and Thru Account fields.

   • A valid rate type in the Rt Ty field.

   • A valid calculation method in the CM field.

   • AC (or user-specified consolidation ledger) in the Fr LT (from ledger type) field.

   • 1.0000000 in the Override Rate field.

3. Run the Compute Restated Balances program.

4. Run the Annual Close program for the AC ledger to ensure that the restated ledger balances.