Journal entries

Question

When you say it is just an adjustment process, does that mean the elimination is not entered in books gl at the year end (not even in a separate company that is opened to book elimination entries so that when we run the consolidated tb, the intercompany balances are eliminated and the tb shows just the outside transactions) and that it is just a presentation in audited financials by the auditors without any effect on the gl?

Answer 1

if the company maintain consolidated ledgers and trial, then adjustment entries are required to be shown in these ledgers otherwise there is no need to post entries

Comments

Hi Vesh,

We have a web based ERP in which all the companies financials are maintained (including foreign operations). So should we post the adjustment entries? If yes, which company books will the same posted to and what would be the journal entries?

P.S.: Foreign operations books are maintained in their local currency.

Regards,
Pratik

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its upto you..you did not understand my last reply,i think so,so i am explaining again that if you are maintaining consolidated ledgers for consolidation purpose then you have to pass adjusting entries, if you donot have as such ledgers, then there is no need to pass such entries..