Participation/ subsidiary

1

Hello all,

I could not find an answer to my question and probably this would be very straight forward in manager. Can someone point me in the right direction?

Under assets I created a new account called financial fixed assets. In this account I track my participation in other businesses.

How do I do the following?
Assume that a subsidiary has 100.000 in retained earnings in 2022 (before dividends). Further, 50.000 in dividends is paid out from the subsidiary to the holding company.

  1. Change the equity part of the participations? What is the journal entry?
    Is the following approach correct?
    D: Financial fixed assets participation X 100.000
    C: Set up a new account called result participations and credit this account.

how do i ensure that result participations is not included in the corporate income tax calculation?

  1. for the dividend I do the following:
    D: Bank account 50.000
    C: Financial fixed assets: 50.000

Is this correct?

2

Did you condsider Track investments in marketable securities | Manager ?

3

Hee Eko,

No i did not because this is not a marketable security. With a participation you own more than 5% of the underlying business. In this case, 50%.

I could consider using your solution, but would that be the correct approach? And how to deal with dividends then?

4

Is this participation as an Individual or as a Business? Somehow it seems a private further capital investment in an underlying business. I assume you enabled capital accounts https://www.manager.io/guides/8936

As such would not be different from the investment you made in the business itself.

5

I track it as a business.

Thus a limited liable company owns other limited liable companies. I did not enable capital accounts by the way

6

I would recommend you test with Capital Accounts and Capital Subaccounts (each business) as you invest in your own company and subsidiaries. See https://www.manager.io/guides/14397 and also consider creating Capital Control Accounts for each Business /Subsidiary you invest in.

7

@Robbert_Manager, you do not seem to be asking questions about Manager. This is not a forum for general accounting advice. I will note, however, that you seem to be doing some very unusual things. Investments in other businesses are not fixed assets. Begin by reading the Guide: https://www.manager.io/guides/9106.

I recommend you obtain advice about your situation from a qualified accountant. When you have a question concerning how to accomplish valid accounting actions with Manager, ask them here.