What is 'divestiture accounting' in SAP FI-LC - Consolidation?

divestiture accounting - Overview

• Component: FI-LC

• Component Name: Consolidation

• Description: The process that occurs when a company is divested and therefore leaves the consolidation group. Divestiture accounting could take place, for example, if: The company is sold to an external trading partner divestiture The status of the company changes

divestiture accounting - Details

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  Key Concepts: 
  Divestiture accounting is a process used in SAP FI-LC Consolidation to account for the sale of a subsidiary or business unit. It involves the transfer of assets and liabilities from the parent company to the buyer, as well as the recognition of any gain or loss on the sale. The divestiture accounting process is used to ensure that the financial statements of the parent company accurately reflect the sale of the subsidiary or business unit. 
  
  How to use it: 
  In SAP FI-LC Consolidation, divestiture accounting is used to record the sale of a subsidiary or business unit. The process involves transferring assets and liabilities from the parent company to the buyer, as well as recognizing any gain or loss on the sale. The divestiture accounting process is used to ensure that the financial statements of the parent company accurately reflect the sale of the subsidiary or business unit. 
  
  Tips & Tricks: 
  When performing divestiture accounting in SAP FI-LC Consolidation, it is important to ensure that all assets and liabilities are properly transferred from the parent company to the buyer. Additionally, any gain or loss on the sale should be accurately recognized in order to ensure that the financial statements of the parent company accurately reflect the sale of the subsidiary or business unit. 
  
  Related Information: 
  For more information on divestiture accounting in SAP