Enterprise Ledger > Creating Elimination Journal Entries

Creating Elimination Journal Entries

Elimination journal entries are entries that consolidate the account activity of related entities to remove any net activity that results from related-party or related-entity transactions, such as one entity lending funds to another, one entity paying off a debt for another, one entity purchasing goods and services for another, and ownership rollups.

Certain reports enable you to consolidate financial activity between entities. The system provides a report option on the following reports that enable you to include elimination journal entries so you can consolidate financial data and remove any net activity between two entities:

▪ Balance Sheet (MRI_BALST)

▪ Comparative Income Statements (MRI_CMPINCS) as follows:

▪ Comparative Income

▪ Comparative Income Statement with Notes

▪ Comparative Income Statement with Prior Period

▪ Comparative Income Statement with Number of Months

▪ Crosstab Income Statement (MRI_CROSSTAB)

▪ Forecast-Budget Report (MRI_FORECAST)

▪ Monthly Prior/Current/Budget Report (MRI_MONTHLY)

▪ Standard Income Statement (MRI_STDINC)

▪ YTD Comparative Income Statement with Variance Notes (MRI_VARNOTE)

If you drill down on an amount on a GL financial report that includes elimination entries, the system opens the GL Inquiry page. The Include Eliminating Entries option on the GL Inquiry page will be set the same as the option used to run the report.

To create an elimination journal entry, follow these steps:

1. Go to Application Menu > General Ledger > Enterprise Ledger > Elimination Entries.

2. To create a new elimination entry, click Add.

To continue creating or to modify an existing elimination entry, click its Edit link. If necessary, use the search criteria to find the existing elimination entry.

3. In the header, complete the following fields to define the elimination entry. The combination of debit entry, credit entry, basis, and period form a unique elimination entry, and the combination cannot be duplicated for another elimination journal entry.

▪ Debit Entity—Select the entity whose ledger contains a credit amount from an intercompany transaction that you want to eliminate so you can prepare a consolidated financial statement.

▪ Credit Entity—Select the entity whose ledger contains a debit amount from an intercompany transaction that you want to eliminate so you can prepare a consolidated financial statement.

▪ Basis—Select the accounting basis to use to record the elimination journal entry.

▪ Period—Enter the period to which the elimination journal entry applies.

4. If a blank line is not available in the grid, click Add.

5. In the grid, complete the following line item fields to enter transaction activity to be eliminated:

▪ Debit Department—Select the department of the debit entity associated with the transaction.

▪ Debit Account—Select the account to which to debit the account activity.

▪ Credit Department—Select the department of the credit entity associated with the transaction.

▪ Credit Account—Select the account to which to credit the account activity.

▪ Activity—Enter the amount to eliminate from the net activity of an intercompany transaction.

6. To add another transaction between the two entities with activity that needs to be eliminated, repeat Steps 4 and 5.

7. To delete a transaction activity line item, select the check box for the line item, and then click Delete.

8. Click Save. The system returns you to the list of elimination journal entries.

9. To delete an elimination journal entry, select the check box for the entry, and then click Delete.