What is adjustment to retained earnings in SAP (EC-CS - Consolidation)?

SAP Term: adjustment to retained earnings

• Component: EC-CS

• Component Name: Consolidation

• Description: An adjustment to retained earnings occurs only if the appropriation of net income is located after the income statement. The adjustment automatically generates two line items: one posts to the retained earnings item in the balance sheet, and the other posts to the transfer item for net income at the end of the income statement. When a document is posted, an automatic adjustment is made only if the balance of all normal line items referring to the balance sheet is not equal to zero; The balancing entry is then made to the balance sheet.

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• Key Concepts: 
  Adjustment to retained earnings is a feature of the SAP EC-CS Consolidation component. It allows companies to make adjustments to their retained earnings accounts in order to accurately reflect the financial position of the company. This feature is especially useful for companies that have multiple subsidiaries or divisions, as it allows them to make adjustments to the consolidated financial statements. 
  
  How to use it: 
  To use the adjustment to retained earnings feature, users must first set up the necessary accounts in the SAP system. This includes setting up a retained earnings account and any other accounts that may be necessary for making adjustments. Once the accounts are set up, users can then enter the necessary adjustments into the system. The adjustments will then be reflected in the consolidated financial statements. 
  
  Tips & Tricks: 
  When making adjustments to retained earnings, it is important to ensure that all of the necessary accounts are set up correctly. This will help ensure that all of the adjustments are accurately reflected in the consolidated financial statements. Additionally, it is important to keep track of all of the adjustments that have been made, as this will help ensure that all of the adjustments are properly accounted for. 
  
  Related Information: 
  For more information on how to use the adjustment to retained earnings feature in SAP EC-CS Consolidation, please refer to SAP’s official documentation on the topic. Additionally, there are many online resources available that provide detailed instructions on how to use this feature.