Consolidation of Balance Sheet

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Anil Chavan (Querist)
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15 February 2008 How to consolidate the Balance sheet? And what is eleminated entries?
If our one unit is in India & another one is in US. Then how do I consolidate the Balance sheet? There is differance in currancy. Means while the consolidation the cost of $ (Dollar) increases or decreases as compare to the date on which the assets are purchased.

Can anybody help me out.

jegannath G

jegannath G (Expert)
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15 February 2008 all the balance sheet items of the US unit should be converted at the closing rate of the balance sheet & all the profit & loss account items are to be converted at the average rate for the year.

All the items are to be added by line by line & the inter unit transfers / income / expenses are to be eliminated.

all the exchange fluctuations are to treated as foreign exchange fluctuation reserve account under the balance sheet - Reserves & Surplus.

This is how consolidation is all about.

Please read AS 21 for the details

Anil Chavan

Anil Chavan (Querist)
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15 February 2008 Could you please tell me what is AS 21?
Please

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