Postings to account 79

How is account 79 used in accounting?

Account 79 performs the function of a registrar of all business transactions between the head office and branches of the enterprise. Transactions related to interaction with departments are reflected on a separate balance sheet.

Such mutual settlements can be based on:

Transfer of property (equipment, materials and other assets) to the subdivision fund.
Payroll calculations for branch employees in cases where the payroll is located in the central office.
Deductions related to asset trust management agreements.
Mutual settlements for current operations (all settlements related to the activities of the organization: sales, rent, provision of services, etc.).

A trust agreement is a transfer of assets (profit-generating property) to a department (branch, division) for the purpose of managing these assets to obtain benefits to the party transferring the property assets.

Account 79 - active-passive. It records the operations of both the company's head office and the receiving party - the divisions. The debit reflects the actions of the transferor, and the credit - the receiver (this approach is valid for the transfer of assets, with liabilities - the opposite is true).

Postings to account 79 “Intra-business settlements”

Correspondence and main postings to the “Internal business settlements” account are presented in the table:

Account Dt	Kt account	Wiring Description
79	01/04/05/07/ 08/10/11/15/ 16/20/21/41/ 43/58, etc.	Transfer of property to a separate division (hereinafter referred to as the SB) and a trustee (from the parent organization and the founder of the management). Acceptance of property by the OP and the trustee – reverse posting. Return of property upon closure of the OP/termination of the trust management agreement (in the OP). The property is accounted for in the parent organization - reverse posting.
79	02	Accumulated depreciation on property received from the OP. Reflection of amounts - reverse posting.
79	20/23/29	Reflection of the provision of EP services
79	25/26	Write-off of part of management expenses for OP
79	50/51/52/55	Reflection of the transfer of funds to the OP
79	60	Acceptance of invoices from suppliers/contractors for assets, works/services for the OP. Repayment of debt at the expense of the OP - reverse posting.
79	70	Calculation of payments to employees of the OP. When an employee is transferred from an EP, arrears of wages are reflected. Transfer of debt - reverse posting.
79	71	Reflection of payment to accountable persons of the EP's debts When transferring an employee from the EP, re-registration of accountable amounts is a reverse entry.
79	76	Insurance of the property of the OP (accrual of payments) and charges to various organizations for services for the OP. Payment of debt at the expense of the OP - reverse posting.
79	84	Write-off of losses at the expense of the OP and the trustee. Accrual of income to employees of the OP - reverse posting.
79	90/91	Reflection of income from the activities of the OP. Reflection of OP expenses - reverse posting.
79	99	Reflection of losses from emergency circumstances at the expense of the OP. Disposal costs – reverse entry.
05	79	Reflection of the amount of accumulated depreciation on intangible assets.
23/25/26/ 29/97	79	Costs transferred by internal departments (according to advice notes) are taken into account.

Subaccounts and analytics

For the convenience of systematizing information, the following sub-accounts can be opened for account 79:

79.01 “On allocated property”;
79.02 “For current operations.”;
79.03 “Under a property trust management agreement.”

Account 79 reflects the mutual settlements of the organization with its branches, divisions, subsidiaries, etc. Analytical accounting is carried out separately for each division/agreement, which implies the opening of additional sub-accounts, the number and nature of which are determined by the specifics of the company’s accounting policy.

Typical wiring with examples

After accepting the advice note, the recipient and sender of the notice create accounting records in the accounting registers of their department. As an example, let's look at several of the most common transactions with postings to account 79.

Transfer of property from the head enterprise to the division

The April furniture factory transferred the following property to the Naberezhny branch:

Woodworking machine. The original cost is 120,000 rubles, accrued depreciation is 16,000 rubles.
Lumber worth 85,000 rubles.

Debit	Credit	the name of the operation	Sum
Postings in the accounting department of the April factory:
79-1	01	Transfer of the initial cost of a woodworking machine	120000,00
02	79-1	Write-off of wear and tear on a woodworking machine	16000,00
79-1	10	Write-off of lumber cost	85000,00
Postings in the branch accounting department
01	79-1	Registration of a woodworking machine (initial cost)	120000,00
79-1	02	Reflection in the accounting of wear of a woodworking machine	16000,00
10	79-1	Arrival at the lumber yard	85000,00

Transfer of branch income to the central organization

Income from the main activities of the branch for the month in the amount of 12,580,000 rubles was transferred by the branch to the central office for inclusion in the consolidated statements.

Debit	Credit	Contents of operation	Sum
Postings in the accounting department of the Naberezhny branch:
90	79-2	Transfer of income	12580000,00
Postings in the accounting department of the April factory:
79-2	90	Revenue receipt	12580000,00

Settlements under trust management agreements

The Zarya furniture factory transferred the building under a trust management agreement. The initial cost of the building is 1,820,000 rubles, accrued depreciation is 300,000 rubles.

transferred the monthly amount of profit under the contract in the amount of 45,000 rubles to the settlement account of a furniture factory.

Debit	Credit	Business transaction	Sum
Postings in the accounting department of the April factory:
79-3	01	Transfer of the original cost of the building	1820000,00
02	79-3	Write-off of accrued depreciation of a building	300000,00
50	79-3	Receipt of payment under the contract to the bank account	45000,00
79-3	91	Reflection of profit under the contract in financial results	45000,00
Postings in accounting:
01	79-3	Registration of the initial cost of the building	1820000,00
79-3	02	Reflection of accrued depreciation of the building	300000,00
79-3	50	Transfer of payment under the agreement	45000,00
84	79-3	Reflection in the financial results of the profit due to the furniture factory "April"	45000,00

To prevent overlap of turns when generating consolidated financial statements, the postings of the transmitting and receiving parties must be mirror opposite. Another prerequisite is the creation of transactions in one reporting period.

Example of invoice registration 79

(St. Petersburg), decided to open a branch in Vologda, using calculations on a separate balance sheet. The company transferred equipment worth RUB 300,000 to the branch for use. (with depreciation equal to 81,000 rubles) and procurement materials totaling 52,000 rubles. As a result, the accountant generated the following entries:

from the debit of account 79 to the credit of account 01, he wrote off the amount of 300,000 rubles, reflecting the transfer of equipment to the branch;
from the debit of account 02 to the credit of account 79, he wrote off the amount of 81,000 rubles, reflecting depreciation;
from the debit of account 79 to the credit of account 10, he wrote off the amount of 52,000 rubles, reflecting the transfer of procurement materials.

On the part of the Vologda branch of Fix LLC, transactions will be registered in the reverse order.

Settlements with divisions

A legally approved feature of a separate unit is a remote workplace.
That is, a branch (representative office) has means and tools of labor and carries out business transactions. Effective management of an enterprise as a complex and monitoring the economic situation of structural units require the creation of localized accounting in remote offices with the subsequent transfer of information to the parent company. Control of financial indicators is organized in two directions:

Inventory, current and non-current assets;
Current activity.

To collect and analyze information on each item, account 79 provides for the opening of sub-accounts.

“Calculations for allocated property”

The transfer of material assets between the main organization and the branch (representative office) is formalized by an act on the basis of which the transferring and receiving parties register account assignments in the transaction journals.

Examples of typical operations:

Debit	Credit	Type of property
79	01	Fixed assets
02	79	Fixed assets
79	04	Intangible assets
05	79	Intangible assets
79	41	Retail goods (wholesale products are reflected in the same way, excluding the entry for reversing the markup)
42	79
79	10	Inventory, workwear listed in the warehouse
	012	Low-value items (up to RUB 40,000.00), written off as expenses in accordance with the law
	07, 08	Equipment, capital investments
	20	Unfinished products
	41	Finished products
	50, 51, 52, 55	Cash provided that a bank account is opened for an additional office
	62	Letter to debtors about changing the payment procedure - the rights to claim the debt have been transferred to the branch

In remote divisions, transactions will be entered into account 79 “Intra-business settlements” in the same way as those carried out by centralized accounting, but debits and credits will be swapped.

"Calculations for current operations"

In the process of conducting business, branches notify the head office of completed transactions by sending an advice note - a primary document that serves as the basis for processing transactions.

An example of reflecting in management accounting the purchase of goods by a wholesale warehouse that does not have its own bank account:

Debit	Credit	Amount, rub.
60	51	25 000,00	Money transferred to the supplier
79	60	25 000,00	The wholesale warehouse sent a notification about the receipt of products

The separate division will formalize the transaction as follows:

Debit	Credit	Amount, rub.
41	60	25 000,00	Products have arrived
60	79	25 000,00	Payment reflected

From the tables it can be seen that after the department transfers the turnover balance sheet for reporting, the enterprise’s balance sheet will remain a balance for goods, but account 79 does not have balances, and there is no line for it.

Article 146 of the Tax Code of the Russian Federation, clause 1 - there are no exchange rate differences.

Anonymous

, Article 146 of the Tax Code of the Russian Federation, clause 1 - there are no exchange rate differences. Another thing is that you need to understand when to determine the base if the calculations are expressed in currency.

Tax Code of the Russian Federation, VAT, article 153. Tax base

3. When determining the tax base, the taxpayer’s proceeds (expenses) in foreign currency are recalculated into rubles at the rate of the Central Bank of the Russian Federation, respectively, on the date corresponding to the moment of determining the tax base for the sale (transfer) of goods (work, services), property rights, established by Article 167 of this Code, or on the date of actual expenditure.

Article 167. Moment of determination of the tax base 1. For the purposes of this chapter, the moment of determination of the tax base, unless otherwise provided by “clauses 3”, “7” - “11”, “13” - “15” of this article, is the earliest of the following dates

: 1) day of shipment (transfer) of goods (work, services), property rights; 2) the day of payment, partial payment for upcoming deliveries of goods (performance of work, provision of services), transfer of property rights.

That is, at the time of shipment (or receipt of an advance), you determine the base at the Central Bank rate and that’s it. You do not make any “additional charges” of VAT even if you receive income (expense) for the IR.

Features of accounting in unitary enterprises

In unitary enterprises, all settlements with state and municipal authorities regarding allocated property and distribution of income are recorded in account 75 “Settlements with founders”. The following subaccounts can be opened to this account:

01 “Calculations for allocated property”;
02 “Calculations for payment of income.”

Subaccount 75-01 “Settlements for allocated property” reflects the organization’s settlements with a state body or local government body for the property transferred to the balance sheet of the enterprise, under the right of economic management or operational management.

At the time of the creation of a unitary enterprise and the endowment of its property, the following entries are made in the accounting records of the organization for these business transactions:

Debit 75-01 “Settlements on allocated property”
Credit 80 “Authorized capital”.

After the unitary enterprise actually receives property and funds from state or municipal bodies, the following entries are made:

Debit 07 “Equipment for installation”
Loan 75-01 “Settlements on allocated property”
and/or
Debit 10 “Materials”
Loan 75-01 “Settlements on allocated property.”

The endowment of a unitary enterprise with current and non-current assets without increasing the size of the company's authorized capital is accompanied by the following entry in accounting:

Debit 75-01 “Settlements on allocated property”
Credit 84 “Retained earnings (uncovered loss).”

At the time the unitary enterprise actually receives property and funds not related to the formation of the authorized capital, the corresponding entry is made in the accounting records:

Debit 08 “Investments in non-current assets”
Loan 75-01 “Settlements on allocated property”
and/or
Debit 10 “Materials”
Loan 75-01 “Settlements on allocated property”
and/or
Debit 58 “Financial investments”
Loan 75-01 “Settlements on allocated property”

In the event of seizure of property and funds in the organization’s accounting records, account 75-01 is debited for the value of the property in correspondence with the corresponding account for property or funds. At the same time, the capital of the enterprise is reduced by the amount of seized property. This is reflected in the credit of account 75-01, and the debit of account 80 “Authorized capital”, or the debit of account 84 “Retained earnings (uncovered loss)”.

A unitary enterprise may be allocated funds for special purposes. This operation is reflected by posting:

Debit 75-01 “Settlements on allocated property”
Loan 86 “Targeted financing”.

Subaccount 02 “Calculations for the payment of income” reflects the calculations of the unitary enterprise with state bodies and local governments for the income due to them based on the results of the economic activities of the unitary enterprise. The accrual of income in the accounting records of a unitary enterprise is reflected as follows:

Debit 84 “Retained earnings (uncovered loss)”
Loan 75-02 “Calculations for payment of income.”

Analytical accounting for account 75 “Settlements with founders” is carried out for each enterprise separately.

Accounting: account 79 “Intra-business settlements”

Credit of subaccounts of separate divisions – display of accepted assets.

Control is exercised over the state of mutual settlements with separate divisions that maintain independent accounting for all other transactions, with the exception of the transfer of property to these departments of the company.

Information on the execution of agreements on trust management of property.

Trust management is understood as a type of agreement in which one participant (the management founder) transfers his assets to another participant (the manager) for an agreed period. The trustee, in turn, assumes the responsibility to manage the received assets in the interests of the founder or a person designated by him (the beneficiary). As a rule, the objects of the agreement are securities, real estate or other assets (except for cash).

The debit of the subaccount displays the value of the transferred property in correspondence with the asset accounts (for example, 01, 04.).

At the same time, the operation of accounting for depreciation charges is carried out.

Subaccount credit – display of accepted assets from the trustee.

Upon termination of the agreement, a reverse entry is made in the accounting records of both parties.

Transfer of funds - income of the founder of the management: the sub-account is credited from the manager, debited from the founder in correspondence with the cash accounts (cash payment or non-cash transfer).

The costs of trust management arising from damage to assets or their loss, subject to compensation from the manager, are displayed according to Dt76 and Kt91. Upon receipt of this compensation, the amount is written off according to Kt76.

5 (306). The organization has branches allocated to a separate balance sheet. The balance on account 79 “Intra-economic settlements” in the balance sheet is reflected in a collapsed manner on page 280 “Other short-term assets”.

Is the organization doing the right thing?

Wrong.

Branches that have a separate balance sheet are recognized as organizations for the purposes of the Law of the Republic of Belarus dated July 12, 2013 No. 57-Z “On Accounting and Reporting” (hereinafter referred to as the Law) (paragraph 9 of Article 1 of the Law). Therefore, they must prepare financial statements (Articles 14, 15 of the Law).

The item “Long-term accounts receivable” (page 170) of the balance sheet shows accounts receivable, incl. advances issued, prepayments recorded in accounts 60 “Settlements with suppliers and contractors”, 62 “Settlements with buyers and customers”, 76 “Settlements with various debtors and creditors” and other settlement accounts, the repayment of which is expected in more than 12 months after the reporting date. If there are reserves for doubtful debts, which are recorded on account 63 “Reserves for doubtful debts”, the indicator of this item, in connection with which reserves for doubtful debts were created, is reduced by the amount of these reserves.

The article “Short-term accounts receivable” (p. 250) shows accounts receivable, incl. advances issued, advance payments recorded in accounts 60, 62, 76 and other settlement accounts, repayment of which is expected within 12 months after the reporting date. If there are reserves for doubtful debts accounted for on account 63, the indicator of this item, in connection with which reserves for doubtful debts were created, is reduced by the amount of these reserves (part 15 of clause 13 of National Standard No. 104) |*|.

* Information that enterprises will have the right to sell receivables

The article “Other long-term liabilities” (p. 560) shows obligations the repayment of which is expected more than 12 months after the reporting date, not shown on pp. 510–550 (part seven of clause 15 of National Standard No. 104).

On page 638, “other creditors” shows accounts payable that are not shown on pages 631–637, incl. accounts payable for interest on loans and borrowings, recorded in accounts 66 “Settlements on short-term loans and borrowings”, 67 “Settlements on long-term loans and borrowings”, accounts payable to employees, recorded in accounts 71 “Settlements with accountable persons”, 73 “ Settlements with personnel for other operations" (part 12 of clause 16 of National Standard No. 104).

Thus, the organization incorrectly reflected the balance of account 79 in the balance sheet collapsed on page 280 “Other short-term assets”. The debit balance of account 79 should have been reflected on lines 170, 250, and the credit balance on lines 560, 638.

Subaccounts 79 accounts and reflection of transactions in the head department

79 account is active-passive. Receipts are reflected according to Kt, write-offs - according to Dt of the account. A subaccount is created for each type of transferred assets. The number of these sub-accounts is not limited by law, but it is more logical to arrange transactions according to the scheme proposed by the Chart of Accounts.

79.01 Settlements for allocated property. This reflects operations on the movement of property, current and non-current assets between the “singles” and the head office;
79.02 Settlements for current transactions. Movements of cash and non-cash funds and intangible assets;
79.03 Settlements under trust management agreements. That is, settlements for property and intangible assets located in the trust.

Example: transfer of a fixed asset from a branch to the head office

The head division of Progress JSC transferred the garage premises to Delta LLC. The initial cost of the premises is 200,000 rubles, the amount of accrued depreciation is 60,000 rubles.

The accountant of the head division (JSC Progress) made the following entries: