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Guideline to Changes in Group Structures Guideline
Guideline
Guideline to Changes in Group
Structures
Product(s): IBM Cognos Controller 8.1
Area of Interest: Upgrade/Migration
Guideline to Changes in Group Structures
2
Copyright
Copyright © 2008 Cognos ULC (formerly Cognos Incorporated). Cognos ULC
is an IBM Company. While every attempt has been made to ensure that the
information in this document is accurate and complete, some typographical
errors or technical inaccuracies may exist. Cognos does not accept
responsibility for any kind of loss resulting from the use of information
contained in this document. This document shows the publication date. The
information contained in this document is subject to change without notice.
Any improvements or changes to the information contained in this document
will be documented in subsequent editions. This document contains
proprietary information of Cognos. All rights are reserved. No part of this
document may be copied, photocopied, reproduced, stored in a retrieval
system, transmitted in any form or by any means, or translated into another
language without the prior written consent of Cognos. Cognos and the
Cognos logo are trademarks of Cognos ULC (formerly Cognos Incorporated)
in the United States and/or other countries. IBM and the IBM logo are
trademarks of International Business Machines Corporation in the United
States, or other countries, or both. All other names are trademarks or
registered trademarks of their respective companies. Information about
Cognos products can be found at www.cognos.com
This document is maintained by the Best Practices, Product and Technology
team. You can send comments, suggestions, and additions to
[email protected]
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Guideline to Changes in Group Structures
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Contents
1
INTRODUCTION ............................................................................................ 3
1.1
1.2
1.3
PURPOSE ............................................................................................................3
APPLICABILITY .....................................................................................................3
EXCLUSIONS AND EXCEPTIONS ..................................................................................4
2
GENERAL INFORMATION ABOUT DATABASE TABLES .................................. 4
3
COMPANY STRUCTURE ................................................................................. 6
4
E300 – HANDLING OF OPENING BALANCES................................................. 6
4.1
4.2
4.3
4.4
CHANGES IN STRUCTURES CAN LEAD TO OPENING BALANCE DIFFERENCES FOR GROUPS: ..............6
E300 – HANDLING OF OPENING BALANCES – EXAMPLES ...................................................7
CONVERSION ISSUES WITH E300 ...............................................................................9
LIMITATIONS .......................................................................................................9
5
INTERNAL STRUCTURE CHANGES - MANUAL ............................................. 10
5.1
5.2
5.3
5.4
SELLING GROUP.................................................................................................. 10
BUYING GROUP .................................................................................................. 13
STANDARD REPORTS FOR ANALYSIS .......................................................................... 14
CURRENCY CONVERSION ....................................................................................... 14
6
INTERNAL STRUCTURE CHANGES - AUTOMATIC ....................................... 15
7
EXTERNAL STRUCTURE CHANGES - MANUAL ............................................. 18
7.1
7.2
7.3
SELLING GROUP.................................................................................................. 18
STANDARD REPORTS FOR ANALYSIS .......................................................................... 21
WITHOUT E300/CURRENCY CONVERSION CODING – EXAMPLES ......................................... 22
8
MERGERS .................................................................................................... 23
8.1
BASIC RULES FOR MERGERS .................................................................................... 23
9
CHANGED OWNED PERCENTAGE ................................................................ 24
9.1
9.2
SELLING GROUP.................................................................................................. 24
STANDARD REPORTS FOR ANALYSIS: ......................................................................... 26
10
CHANGED CONSOLIDATION METHODS ...................................................... 26
10.1
10.2
SELLING/BUYING GROUP ....................................................................................... 26
STANDARD REPORTS FOR ANALYSIS .......................................................................... 29
11
ADJUST OPENING BALANCES ..................................................................... 30
11.1
11.2
MANUALLY ADJUSTING OPENING BALANCES IN AUTOMATIC JOURNALS .................................. 30
11.2 LIMITATIONS WITH ADJUSTING OPENING BALANCES IN AUTOMATIC JOURNALS................. 31
1
Introduction
1.1
Purpose
This document will provide guidelines to making structural changes in
Controller.
1.2
Applicability
Controller 8.1 or higher and Olkomo.
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1.3
4
Exclusions and Exceptions
Does not cover Structure Changes with Nykomo.
2 General information about database tables
Analysis of details can either be done in Standard reports or in the database tables
using Maintain/Special utilities/Browse data. Working directly in the database tables
will give you more details compared to the standard reports.
This is a short overview of where you can find different types of data:
xacqmain
Information from Shareholdings and Investments, excluding amounts
xacqamount
Information from Shareholdings and Investments regarding amounts,
connected to the line numbers in xacqmain
xacqdepr
Details about depreciation items (manually entered, flag M, or
automatically calculated, flag A)
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xacq_conv
Details about currencies and counter companies (used by xacq events
and IC/IP)
xkstruc
Company structure from a group perspective (level by level, from/to
period). This is the table shown in Maintain/Company structure/Define
tab Generated view.
xkstrucs
Sold companies are stored here during the year when they are sold
with method Q. Cross-owned companies stored with method A and R.
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xdbYY
6
Calculated eliminations/automatic journals are stored on
companies/groups
3 Company Structure
After Structure changes it is very important to check that the company
structure is correct in Maintain/Company Structure/Define – Generated View
1 Is the ownership correct level by level
2 Is the ownership correct in parallel structures
3 Possible to do manual corrections/adjustment if needed
4 E300 – Handling of Opening Balances
4.1
Changes in structures can lead to Opening Balance differences for
groups:
1 Acquisition/divestments of companies – External/Internal
2 Changes in Consolidation Methods
3 Change in Ownership
Without table E300 these differences have to be handled manually with Group
Adjustments.
With E300 the Opening Balance differences are handled automatically - it
calculates the difference between the rolled-in and the calculated OB and books
it on a selected account:
1 The calculation base is xdbYY + xkstruc
2 Reported values and manual journals will get Automatic Journal Type 20
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4
5
Automatic journals will get the same Automatic Journal Type as the
original posting and the journal number in E300 (99 is recommended)
A sold company gets consolidation method Q in table xkstrucs during
the current year
All control tables that calculates based on xdb values have to have OB
accounts as From Account in the Automatic Journal tables (for example
E700 Minority).
Example of E300 Automatic Journal table:
Should contain all OB accounts that could be affected by the different types of
structure changes. It is possible to have different To Accounts for different
types of structure changes, and also for Internal/External changes.
Recommended journal number is 99.
4.2
7
E300 – Handling of Opening Balances – Examples
Example Gradual Disposal:
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Guideline to Changes in Group Structures
E300 will handle the Opening balance difference caused by that the OB
minority share will be calculated using the new minority percentage of 25%
instead of the percentage used last year end, 20%. It is adjusted by 5%
against the To Account in E300 for Changes in Owned %.
Example internal acquisition/disposal – Buying group:
In the buying group there are Opening balances for REPO in the acquired
company that was not included in the Closing balance last year-end. In this
case there is also a minority calculation in the acquired company that was not
included in the Automatic journals last year-end. E300 adjusts for both these
OB differences against the To Account in E300 for Internal Investments.
Example internal acquisition/disposal – Selling group:
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In the selling group, last year-end there were both REPO values and a minority
calculation. Now that the company has been removed from the group, E300
posts these missing Opening balances against the To Account in E300 for
Internal Disposals.
4.3
Conversion issues with E300
Use conversion coding for Opening balances (I) on the To Account in E300 to
get the same converted amount on the Changes in structures account as on
the Opening Balance account in the specification (works both with and without
E300!)
4.4
Limitations
Issues related to buying and selling companies during a year can not be
handled by the current functionality in E300:
1 Net Profit for the current year for a sold company has to be entered on
the selling group with a group journal
2 IC reporting during the rest of the year against a sold company is not
possible, since it will have method Q
3 You can’t post company journals on a sold company (Method Q)
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Does not work at group level (acquisition/divestment of groups) in versions
earlier than Controller 8.2.
So called “Piece-meal” transactions, meaning more than one change in
participating interest (own %) during a year is not handled. The current owned
% is always used for calculations.
It works only for journals created in the current period (that should be
generated according to consolidation method and owner percentage in the
company in the company structure for the current period).
Independent of closing versions (you can not exclude a closing version from
E300 postings).
Exit of the scope doesn’t work with calculated net movement.
5 Internal Structure Changes - Manual
Example:
1 Company 4200
2 Owned percentage 90%
3 Sold as per 2003-07-01
4 Local currency SEK
5 Surplus Value
6 E300 is active
5.1
Selling Group
Book the divestment on the selling parent company in Group/Data
entry/Shareholdings and Investments:
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Enter the sold items in the Investment Elimination Template. If there are
several items on the same account, they can be added to one line. This does
not apply to surplus values and goodwill with depreciation though!
You have to handle depreciation amounts – link date on items with depreciation
percentage, connect to the right item (use link date, enter sold depreciation on
the last day previous year):
You have to handle depreciation amounts – add a manual line and enter sold
depreciation on the last day previous year:
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Change the To Period in Maintain/Company Structure/Define:
Generated View:
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Guideline to Changes in Group Structures
5.2
Buying Group
Book the investment on the buying parent company in Group/Data
entry/Shareholdings and Investment:
Enter the bought items in the Investment Elimination Template. If there are
several items on the same account, they can be added to one line. This does
not apply to surplus values and goodwill with depreciation though!
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Enter the depreciation amounts – add a manual line and enter OB depreciation
on the last day previous year (it will be copied to OB current year) and add
accumulated depreciation current year until the purchase date on a second
manual line (automatically calculated depreciation will start the month of the
change, in this case 0307):
Connect the company to buying group in Maintain/Company Structure/Define.
5.3
Standard Reports for Analysis
There are a number of different standard reports that can be used for analysis
of the change in structure after consolidation:
1
2
3
4
5
6
5.4
Reconcile – Between accounts/OB by AJT
Trial Balance
Journals
Journals across
Ledger report
Acquisition calculations
o By company
o By account
o Currency Conversion
o Group Net Value
Currency Conversion
To get correct converted amounts after changes, you may need to enter
Historical rates (in order for Closing Balance = 0 in LC to also be Closing
Balance in Group currency = 0).
This is done in two different menus:
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Guideline to Changes in Group Structures
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2
15
Group/Data entry/Historical Rates (REPO and manual journals, on all
accounts with currency conversion code E, F or G)
Group/Data entry/Shareholdings and Investments (here you can enter
historical rates for all accounts)
3 If there is more than one amount on a specific account (same
company) within the same year, they all need to have historical
rates
4 Enter rates against all group currencies at the same or higher levels
in the structure
6 Internal Structure Changes - Automatic
This functionality handles different types of changes:
Replace: New transaction date, new owner, new owned company and new
currency.
Disposal: External and internal disposal and internal acquisition. If E300 is
defined (active or in-active) the accounts defined in the table will be
used.
Delete: Handles Investment/Investment elimination
template/depreciation/historical rates = the information in all windows
at once.
The function is accessed via Group/Data entry/Shareholdings and Investments:
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Replace – the options valid for this type of change will be activated when
choosing replace. Useful for changing the investment date, parent company,
subsidiary and so on.
New currency: if investments are stored in group currency, this option is active.
CB for share capital – This field is active if you store investments in group
currency. This information is necessary to be able to move to historical rates.
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To replace the selected options, select the lines in the ownership information
section that you want to replace the options for and click on the Run-button.
Dispose of - the options valid for this type of change will be activated when
choosing Dispose of. Useful for external or internal divestments and
investments.
Disposal/Investment account for P/L transactions: if you have P/L accounts on
items with an investment date for previous years, you probably want them to
be entered on an account within retained earnings when posting the change.
So, usually a retained earnings account is entered in these two fields.
To run the selected options, select the lines in the ownership information
section that you want to be affected by the change and click on the Runbutton.
Delete - the options valid for this type of change will be activated when
choosing Delete. Useful since it deletes all information in all the different
windows (historical rates, depreciations and so on) in one go.
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To run the selected options, select the lines in the ownership information
section that you want to be affected by the change and click on the Runbutton.
7 External Structure Changes - Manual
Example:
1 Company 4100
2 Owned percentage 100%
3 Sold as per 2003-07-01
4 Local currency GBP
5 Surplus value
6 E300 is active
7.1
Selling Group
Book the divestment on the selling parent company in Group/Data
entry/Shareholdings and Investments.
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Enter the sold items in the Investment Elimination Template. If there are
several items on the same account, they can be added to one line. This does
not apply to surplus values and goodwill with depreciation though!
You have to handle depreciation amounts – link date on items with depreciation
percentage, connect to the right item (use link date, enter sold depreciation on
the last day previous year):
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You have to handle depreciation amounts – add a manual line and enter sold
depreciation on the last day previous year. Current year depreciation has to be
posted in the selling group with a group journal.
Change the ToPeriod for the company in the selling group in Maintain/Company
Structure/Define:
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Check that everything looks correct in the tab Generated View:
7.2
Standard Reports for analysis
There are a number of different standard reports that can be used for analysis
of the change in structure after consolidation:
1
2
3
4
5
6
Reconcile – Between accounts/OB by AJT
Trial Balance
Journals
Journal across
Ledger report
Acquisition calculations
o By company
o By account
o Currency conversion
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7.3
22
Group Net Value
Without E300/currency conversion coding – examples
Always remember to check the company after the sale, that not only closing
balance in local currency is correct but also closing balance in group currency.
To check REPO values, run Group/Reports/Currency conversion or
Group/Reports/Acquisitions and choose report Currency conversion and run it
with contribution version BASE:
You also need to check the elimination with AJT 1, that not only closing balance
in local currency is correct but also closing balance in group currency.
Run Group/Reports/Acquisitions and choose the report Currency conversion,
run it with a contribution version only containing ATJ 1:
How to fix the remaining amounts in group currency? Use historical rates, or
use accounts for the divestment that has conversion code I (if so, they will be
converted using the same rate as the Opening balance account).
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8 Mergers
Example:
1 Company S is merged with Parent P
2 Merger 2006-01-01
3 Enter the merger as a divestment in Shareholdings and Investments
4 Enter the merged company S’s REPO values in the parent company P
5 Disconnect the company S from the Company Structure
8.1
Basic rules for mergers
Treat mergers as external divestments.
If there are surplus values they have to be handled, and there are different
alternatives for this. They need to be discussed with the customer.
1. Add the surplus values to the parent company’s Investment Elimination
Template. Note: they will not be eliminated until the next level in the
structure.
2. Let the parents reporting include the surplus values = enter it in their
general ledger. This is the most correct way to handle surplus values in
mergers, but means that depreciations will have to be calculated manually.
3. Create a dummy company for merger surplus values and connect it to the
same level in the company structure as the parent. Then they will be
eliminated at that level, where they should be. The system will
automatically calculated depreciation.
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9 Changed Owned Percentage
Example:
1 Company 4915
2 Owned share 95%
3 5% divested as per 2003-07-01
4 Local currency SEK
5 E300 is active
9.1
Selling Group
Enter the change on the parent company in Group/Data entry/Shareholdings
and Investments:
Enter the change in Investment Elimination template:
Change the ownership in the Company structure (Fromperiod/Toperiod):
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Guideline to Changes in Group Structures
Check Maintain/Company structure/Define – tab Generated view:
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Guideline to Changes in Group Structures
9.2
26
Standard Reports for analysis:
There are a number of different standard reports that can be used for analysis
of the change in structure after consolidation:
1
2
3
4
5
6
Reconcile – Between accounts/OB by AJT
Trial balance
Journals
Journals across
Ledger report
Acquisition calculations
o By company
o By account
o Currency conversion
o Group Net Value
10 Changed Consolidation Methods
Example:
1 Company 4400
2 Owned by 50% method E, increased to 100% and changed to method P
3 Changed as per 2003-07-01
4 Local currency GBP
5 E300 is active
10.1 Selling/Buying Group
Enter the change on the subsidiary/parent in Shareholdings and Investments.
First sell the line from Shares in Associated, re-enter it on Shares in subsidiaries
and add the additionally acquired part:
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Re-enter the initial 50% on Shares in subsidiaries and the applicable
Equity/Fixed assets accounts:
Enter the additional 50% on Shares in subsidiaries:
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Guideline to Changes in Group Structures
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Change the ownership and consolidation method in Company structure/Define
Which elimination table is used depends on the consolidation method in the
company structure. Even though the Investment elimination template consists
of the same accounts for the initial 50% both when the company had method E
as when it has method P, they will be eliminated on different accounts. Method
E used table E110 and method P table E105.
Change the ownership in the Company structure (Fromperiod/Toperiod):
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Check Maintain/Company structure/Define – tab Generated view:
10.2 Standard Reports for analysis
There are a number of different standard reports that can be used for analysis
of the change in structure after consolidation:
1
2
3
4
5
Reconcile – Between accounts/OB by AJT
Trial balance
Journals across
Ledger report
Acquisition calculations
o By company
o By account
o Currency conversion
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o
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Group Net Value
11 Adjust Opening Balances
11.1 Manually adjusting opening balances in Automatic Journals
This function is located in Maintain/Special Utilities/Automatic Journals/Adjust
Opening Balances.
The purpose of the function is to facilitate changes if there have been errors in
calculations regarding acquisitions.
It is possible to:
1 Adjust amounts and transaction amounts
2 Add new accounts (useful for example if there has been changes to the
company structure and you need new ktypkonc-levels)
The changes are stored on period 00 in xdb (for example 0600AC if the
adjustment is between 2005 and 2006).
To see what will be the opening balance for a company, enter the company
code and the closing balance period and actuality:
It is possible to limit the opening balances by choosing specific forms, specific
accounts or specific automatic journal types.
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The opening balances are shown in the middle section of the window. In the
white column you can enter adjustments; the effect will be shown in the
column Amount OB.
To add lines, press the copy button to the right and the new line will be shown
in the section at the bottom of the window. It is possible to change for example
ktypkonc level (Consol. Type).
11.2 11.2
Limitations with adjusting opening balances in Automatic
Journals
There are some limitations and things to keep in mind when using this
function:
1
2
3
4
5
6
7
8
9
AJ´s for elimination of intercompany balances and intercompany profit
can not be adjusted in this window (automatic journal types 35 and 36).
The Transfer/Import Data and Export Data menus do not include the
adjustments of opening balances stored on period 00. This is the case
for Transfer/External Data/Import External Data as well.
Standard reports reconciling the closing balance with the opening
balance are adjusted with the adjustments made in this window. The
adjustment value is also added to the closing balance in the reports to
avoid reconciliation differences.
No currency conversion or other calculations will be performed
automatically when adjustments have been made with this function.
They will be included in the currency conversions for coming periods.
If an adjustment is entered in another currency than the local currency
of the company, it will be ignored. To include an adjustment in other
currencies than LC, a dummy value of 1 need to be entered in the local
currency.
It is not possible to make adjustments to transactions generated by
automatic journal E300.
You can not adjust opening balances for automatic journals that are
based on the investment register. The adjustment needs to be done in
the investment register on a transaction date that proceeds the opening
balance period.
Adjustments of opening balances for automatic journals based on base
values, for example E500 and E700, will only be taken into account and
rolled forward to the next year in a correct way if the opening balance is
configured to roll over to the following year
The values are not included when using the Excel link.
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