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Encyclopedia of accounting - Grachev RE Section II Part 1

Adding fixed assets and capital investments, a legal entity - the founder of the charter capital of other legal entity - issuer of corporate rights

Consider the example of the formation of the authorized capital of the subsidiary. In this part of their contributions to the company's parent provides a ready-to-operating fixed assets (tables 2.20 and 2.21, 2.22), and otherwise - perform the payment in the form of capital investment (Tables 2.23, 2.24, 2.25).

Accounting for the subsidiary - the issuer of corporate rights in the preparation of the parent enterprise fixed assets

Table 2.20

		Turnover of accounts
№ p / p	Contents of operation	The main business operations		calculation of tax operations		sum
		Dt	KT	Dt	KT
1.	It reflects the declared amount of the authorized capital (according to the constituent documents)	46	40			200000
2.	Partially offset by debt-founder of the company by making them assets to the charter capital (the object measured at fair value, the assessment confirmed the act)	10	46			80000

Accounting for enterprise-founder (corporate rights owner) for making the fixed assets to the authorized capital of the subsidiary

Consider two options for accounting for such contributions.

First. When the fair value of the object - the object of making above its book value (ie, what is the amount at which the object was kept on the balance sheet of the founder..).

Second. When the fair value of the object - the object of making less than its carrying value.

I OPTION

• Decision of participants assessed the object of 80,000 USD.

• The carrying value of the object (initial minus depreciation) is: 95000 - 20000 = 75000 USD.

Table 2.21

		Turnover of accounts
№ p / p	Contents of operation	The main business operations		calculation of tax operations		sum
		Dt	KT	Dt	KT
1.	The transmitting entity to the issuer's balance sheet (at book value)	141	10			75000
2.	Debited with the amount of deterioration of the building transferred	131	10			20000
3.	The difference between the fair value and the net book value of the object recognized as income of the reporting period (this wiring formation shown in fair value of financial investments)	141	723			5000

OPTION II

• Decision of participants assessed the object of 80,000 USD.

• The carrying value of the object (initial minus depreciation) is: 95000 - 10000 = 85000 USD.

Table 2.22

		Turnover of accounts
№ p / p	Contents of operation	The main business operations		calculation of tax operations		sum
		Dt	KT	Dt	KT	sum
1.	The transmitting entity to the issuer's balance sheet (at book value): a) the sum of the fair value of transferred object b) the sum of the difference between the carrying amount and fair value of the transferred object	141 963	10 10			80000 5000
2.	Debited with the amount of wear betray object	131	10			10000

Thus, both the first and second embodiment, it turns out that the value of financial investments on the balance sheet of the corporate rights of the owner (the balance of the account 141 in Tables 2.21, 2.22) is equal to the original value of the object taken by the issuer's balance (account balance 10 Table 2.20) .

Accounting for the subsidiary - the issuer of corporate rights in the preparation of the company - the founder of the capital investment in fixed assets

Table 2.23

				Turnover of accounts
№ p / p		Contents of operation		The main business operations				calculation of tax operations				sum
				Dt		KT		Dt		KT
1.		It reflects the declared amount of the authorized capital (according to the constituent documents)		46		40						200000
2.		Partially repaid debts of an enterprise-founder of contributions to the share capital by making them assets for use as fixed assets (object valued at fair value, corresponding to a state in which at this time remains the asset. The rating is confirmed by the act)		152		46						65000
3.		The costs incurred by an enterprise in connection with bringing the asset received to the state in which the asset is available for use, are credited in the capital expenditure		152		Various accounts *						15000
4.		The amount of capital investment is adjusted by the amount incurred in connection with obtaining the object of expenditure. Thus, the value of the object is brought to the right level		977		152						15000
* Various accounts - this account from which the loan, depending on the origin of costs charged when incurred. This may be payments to foreign entities (accounts 377, 631 and so on. P.), Payroll, social insurance, depreciation (depreciation) of fixed assets in service in the work on preparation of a new object to the operation, as well as other accounts, meaning the cost elements (in cases where class 8 shall not apply accounts). I
			Turnover of accounts
№ p / p	Contents of operation		The main business operations				calculation of tax operations				sum
			Dt		KT		Dt		KT
5.	Ready for use shall be entered in the object property and equipment (original cost developed from the fair value of outstanding investment plus additional costs accrued by the fact they are incurred)		10		152						65000

Accounting for enterprise-founder (owner of corporate rights) while making not available for use of fixed assets to the authorized capital of the subsidiary

In fact, the example will show the process of transformation of capital investment in the acquisition of fixed assets on financial investments in subsidiaries.

In this case, we will consider two options accounting for such application.

First. When the fair value of the object - the object is to make above its book value (.. Ie, that the price at which the object is held in the balance sheet of the founder).

Second. When the fair value of the object - the object is to make less than its carrying value.

I OPTION

• Decision of participants assessed the object of 65,000 USD.

• The carrying value of UAH 63,000.

• Wear at the same time no, because the founder of the object at the time of its transmission subsidiary has not been used and accounted for under the capital investment.

Table 2.24

		Turnover of accounts
№ p / p	Contents of operation	The main business operations		calculation of tax operations		sum
		Dt	KT	Dt	KT	sum
1.	The transmitting entity to the issuer's balance	141	152			63000
2.	The difference between fair value and carrying amount of the object recognized as income of the reporting period (this wiring formation shown in fair value of financial investments)	141	723			2000

OPTION II

• Decision of participants assessed the object of 65,000 USD

• The carrying value of UAH 70,000.

Table 2.25

		Turnover of accounts
№ p / p	Contents of operation	The main business operations		calculation of tax operations		sum
		Dt	KT	Dt	KT	sum
1.	The transmitting entity to the issuer's balance sheet: a) the sum of the fair value of transferred object b) the sum of the difference between the carrying amount and fair value of the transferred object	141 963	152152			65000 5000

Thus, both the first and second embodiment, it turns out that the value of financial investments on the balance sheet of the owner of the corporate rights (the account balance of 141 in both versions of the table 2.24,2.25) is equal to the original value of the object taken by the issuer's balance sheet as a capital investment in basic means (account balance 152 table 2.23).

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