Working with Transfers and Divestments: Regional

Tax Reporting supports the entry of Transfers and Divestments on a tax-effected basis, similar to the Acquisitions functionality (refer to Working with Acquisitions: Regional). The tax effect for Transfers and Divestments may differ from simply applying the current year’s tax rates. In some cases, the tax effect for Transfers and Divestments may differ from simply applying the current year’s tax rates; in such instances, rate changes may require balance sheet adjustments that are included in purchase accounting journal entries.

When Transfers and Divestments are entered without manual tax adjustments, the application applies the current year’s tax rate—if only pre-tax data is provided, tax is calculated automatically using this rate. Likewise, if no manual rate change amount is entered, the application computes the rate change based on the current year’s tax rates.

Note:

The Hybrid Dense Sparse Optimization model must be enabled in the application. For details, see Optimizing the Application Model for Hybrid Aggregation in Administering Tax Reporting