Disclosure of non-controlling interests in the balance sheet

The Non-Controlling Interest in Balance Sheet consolidation process (C2) has two variants, the existing legacy C2 process and the enhanced C2 process. You can choose which variant to run.

Note: We recommend that new users use the enhanced C2 process.

Legacy C2 process

Select Business Modeling > Business Objects > Financial > Group Accounts and select the appropriate non-controlling interests account in the Non-controlling Interests column for the required group accounts. To enable this configuration to take effect, publish the model in Business Modeling.

Enhanced C2 process

With the enhanced C2 process, the handling of non-controlling interests postings is extended. The enhanced C2 process:

Ensures that opening balances originate only from rollover.
Excludes opening balance schedule details from standard processing.
Provides a configurable schedule detail parameter for controlling minority adjustment postings.
Aligns data sourcing and entity selection.

The enhanced C2 process supports minority scenarios across periods and standardizes C2 process behavior.

The enhanced C2 process provides these enhancements to the handling of non-controlling interests:

Opening balance handling: Non-controlling interests in the opening balance sheet originate from rollover rather than C2 recalculation. Opening balance schedule details are excluded from standard C2 processing and are processed only if reflecting changes in the minority percentages between periods is required.
Minority change logic: The current-period minority percentage is compared with the previous year's last period. When a change is detected, an additional journal line is created to reflect the difference. If minorities existed in the previous year but don't exist in the current period, rollover journals are reversed.
Journal generation: A separate journal is created per entity with the description in this format: C2 - Recognition of xx% Non-Controlling Interests of [Entity ID - Entity Name]. One journal line is created per movement detail based on the current-period minority percentage.

The enhanced C2 process is enabled by default for new customers. Existing customers have the enhanced C2 process disabled but can enable it manually.

With the optional Schedule Detail parameter, users can define the equity schedule detail for posting minority adjustments.

Comparison of the C2 legacy and enhanced processes

This table shows the comparison of the C2 legacy and enhanced processes:

Table 1.
Category	C2 legacy process	C2 enhanced process
Entity selection	Applies to entities that are owned by a group in full consolidation with minorities. Excludes entities with minority > 0% in the base period and = 0% in the current period. Entities without the minority status are skipped.	Applies to entities that are owned by a group in full consolidation with minorities. Processes entities with a minority in either the current or base period, including cases in which the minority changes to or from 0%.
Account filtering	Processes all group accounts with non-controlling interests regardless of an assigned schedule. No schedule filter is applied, which can enable the unnecessary processing of non-equity accounts. Excludes the balance sheet and profit and loss group accounts.	Processes only group accounts with an equity schedule and an assigned non-controlling interests account. Enforces the equity schedule requirement through the `Detail = Equity` attribute check. Excludes the balance sheet and profit and loss group accounts.
Source cube logic	Uses this 4-cube matrix based on the Detail and Segment dimensions: TFINANG: No detail and segment. TSEGMG: No detail. A segment exists. TDETAIG: A detail exists. No segment. TSEGMOVG: Both detail and segment exist. Caution: When you disable the Generate Segment Journals option, the values from the TSEGMG and TSEGMOVG cubes are skipped. The issues can also occur with the values from TFINANG and TSEGMG cubes for accounts without a schedule.	Simplifies processing to the TDETAIG or TSEGMOVG source cube, depending on the Generate Segment Journals option setting and the existence of a segment attribute (Seg1, Seg2, Seg3). Excludes the TFINANG and TSEGMG cubes.
Consolidation basis	Not applicable.	Source values are read from the level defined by the Consolidation Basis property setting for the Capital Consolidation process category. Provides configurable control over the consolidation level.
Journal creation	No structured per-entity journals with standardized descriptions.	A per-entity journal with a standardized description is created in this format: `C2 - Recognition of xx% Non-Controlling Interests of <Entity ID - Name>`. For example, `C2 - Recognition of 15% Non-Controlling Interests of RU0001 - Genesis Cars`.
Journal lines for movement details	No defined logic for generating journal lines per movement detail.	A journal line is created for each source value of a movement detail. The value is calculated in this way: `source value * current-period minority percentage`. Then, the value is posted to the non-controlling interests account of the source account.
Opening balance handling	A journal line is always created for opening balance details with the current-period minority percentage. When the minority percentage changes between periods, opening balance values are fully recalculated at the new rate. This can produce incorrect results.	A journal line for opening balance details is created only when the minority percentage differs between the current and base periods. The value is calculated in this way: `source value * (current-period minority percentage - base-period minority percentage)`, capturing only the delta because of the ownership change. Retrieves prior-period minority values to support the differential calculation.
C2 process editing	No schedule detail parameter available.	Provides an optional Schedule Detail: Miscellaneous parameter to specify the equity schedule detail to which to post minority adjustments, instead of using the default _OB detail.
Equity schedule validation	No validation. You can enable the C2 process without an equity schedule.	If no equity schedule is available, you can't enable the C2 process. The Error icon is displayed in the Configured column and the checkbox for the C2 process is disabled and you can't select it.