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Administrator Guide
Last Updated: 2023-06-23
Configure Equity Pickup Method Elimination Rules

Configure Equity Pickup Method Elimination Rules

  • Set up company ownership details for investor and investee companies.
  • Security:
    Set Up: Consolidation
     domain in the Financial Accounting functional area.
You can define rules for eliminating equity pickup earnings for the investor and investee companies when you consolidate subsidiaries using the equity method of accounting. For each equity pickup rule, you can define:
  • Default ledger accounts.
  • Ledger accounts for 1 or more companies with their own set of accounts.
  1. Access the
    Maintain Elimination Rules
    Equity Pickup
     tab.
  2. As you complete the
    Equity Pickup
     tab, consider:
    Option Description
    Rule Name
    You can't use a rule name more than once.
    Record in Subsidiary Base Currency
    Select to record equity pickup in the base currency of the subsidiary.
    If you don't select, Workday calculates the equity pickup results in the ledger (base) currency of the parent company or companies.
    Journal Source
    Select only 1 journal source.
    You can define journal sources on the
    Maintain Journal Sources
     task.
    Currency Rate Type
    Select to override the default currency rate types Workday defines at the company or tenant level.
    Source Ledger Accounts/Summaries
    Select 1 or more default ledger accounts or ledger account summaries that you want to use to derive equity pickup results. Each account must be unique, and typically comprises the net income of the subsidiary.
    You can create more than 1 row for each ledger account or ledger account summary entry.
    Example: Select 1 source ledger account for net income and another for dividends.
    If you have multiple levels of ownership, ensure that you include the profit/loss account so that your results flow to the various levels of ownership in the hierarchy. Do this also if you configure the
    Ownership Change Adjustment Account
     option.
    Investment Account
    Select a default ledger account to record the change to the parent investment in the subsidiary.
    Select an account that is different to the provision account to avoid processing errors.
    Profit/Loss Account
    Select a default ledger account to record the change to the parent equity income or loss in the subsidiary.
    The equity pickup process creates duplicate results if you calculate equity pickup using a different rule with the same:
    • Company or Company Hierarchy.
    • Fiscal Period.
    • Source Ledger Accounts.
    Provision Account
    (Optional) Select a provision account to record equity pickup losses for the parent company. If you leave this field blank, Workday tracks losses but won't record them to any account.
    Select a provision account when you select a ledger account from the
    Ownership Change Adjustment Account
     option.
    Select an account that is different to the investment account to avoid processing errors.
    Ownership Change Adjustment Account
    (Optional) Select a ledger account to record the change in ownership from prior period to current period.
    If you don't select an account, Workday won't record ownership changes.
    Workday records the offset on adjustments to the profit/loss account.
    Worktags
    (Optional) Select 1 or more worktags, which can include balancing worktags, that you want to associate with target journal lines.
  3. (Optional) In the
    Company Overrides
     grid, configure an equity pickup rule for 1 or more investor companies when each company has different investment, profit and loss, and provision accounts.
    Ledger accounts and worktags that you specify on the grid override default ledger account and worktag values for investor companies.
Use the
Equity Pickup
 task to calculate equity pickup results.