Hi Guys, Can we roll over retained earnings (e.g. add net income to retained earnings and set net income to 0) at a specific date (mid period) due to acquisition? Any feed back appreciated

The only way I'm aware of is to spin up multi-calendar and then do a stub year. It's clunky and causes all sorts of headaches, but I think it's the best option versus doing manual entries to RE.

That's exactly What Thought - but still a bit cautious about the retained earning account since it is a system calculated account. Theologically if we change the calendar and close the year in the old calendar - it should work most likely 🙂

yeah I went through this a couple years ago. Cut off the fiscal year mid-month and mid-year and RE rolled fine. I split the month into May (old company) and May (new company). It screwed up month-over-month and year-over-year reporting (and maybe some YTD stuff), so that required some tweaks, but otherwise worked fine.

@RJMNS one question - acquiring company is asking that starting on the day of acquisition can we change the fx rate so that revenue postings convert at the rate as of the billing dates of sales and COS/COGS transactions? In my opinion you can change the fx rate on open transactions but will cause problems. To do this its conversion has to be done externally. Since you have been through this few years ago what would be your advice? Thanks again buddy.

Hey @Sam-I-Am. Unfortunately I'm not going to be able to help much on this one. As it happens, our Rev Rec is simple enough to not require legacy Rev Rec or ARM. We have basically instant rev rec so we just cut off everything on the cutover day and this type of thing didn't come up. Reaching back into my consulting brain 5+ years ago for the last time I dealt with ARM (which I assume you're talking about), I concur this is a little sus. IIRC causing an intentional mismatch like that will just cause one of those month-end adjustments that the system generates as part of the Reclass process. So I think while there will not necessarily be any obvious problems with doing this, I think the system will just dump the differences into Unrealized Gains/Losses at the end of the month. I dunno if the acquiring company wants to attribute that to the "old" books or the "new" books, but it's not like those differences are going to disappear into thin air. The dollars have to go somewhere. I guess maybe it depends on what they're really trying to accomplish by changing these rates. I'm not clear what they think the benefit is of this. Reiterating that it's been about 7 years actually (damn time flies) since I've touched ARM, so take any advice from me on that with a huge grain of salt...ha. I'm going completely off memory with no account to play with for reference.

FYI There is no ARM in place, regular rev rec

Meaning the legacy one that's like Amortization Schedules, only reversed?

yup technically correct 🙂

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guess what they decided to go with using JE for the retained earning, currency reval and multibook with multi calendar route. Saves me a lot of elbow grease. Told them that is the easiest way and controlled - one of the big five firm also said the same think now - now they believe