7.2 Consolidation Procedures

Following listed are the Consolidation procedures:

• Combine like items of assets, liabilities, equity, income, expenses and cash flows of the parent with those of its subsidiaries
• Offset (eliminate) the carrying amount of the parent's investment in each subsidiary and the parent's portion of equity of each subsidiary (IFRS 3 Business Combinations explain how to account for any related goodwill)
• Eliminate or retain in full intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between entities of the group (profits or losses resulting from intragroup transactions that are recognized in assets, such as inventory and fixed assets, are eliminated or retained in full). During Consolidation Run, a parameter INTRAFLAG is introduced for Intra Company Elimination at the setup level with YES and NO values. The Intra Company Elimination can be chosen by the customer to eliminate (YES) or skip the elimination (NO) of Intra Company Accounts.