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Administrator Guide
Last Updated: 2025-10-31
Set Up Elimination Rules for Noncontrolling Interest

Set Up Elimination Rules for Noncontrolling Interest

  • Review setup considerations for consolidations and eliminations.
  • Security:
    Set Up: Consolidation
     domain in the Financial Accounting functional area.
You can set up elimination rules to calculate the equity and net earnings (income statement and equity) that are attributable to parties that aren't in the hierarchy for which you run the report.
  1. Access the
    Maintain Elimination Rules
     task.
  2. (Optional) If you're opting in to persist NCI, remove your configuration details on the
    Investment in Subsidiary/Subsidiary Equity (To Be Retired)
     tab.
  3. Access the
    Noncontrolling Interest Activity
     tab.
    Create a rule for the ledger accounts and ledger account summaries that you want to calculate NCI on.
    As you complete this tab, consider:
    Option Description
    Direct Ownership Only (Always Select)
    Select this check box to calculate noncontrolling interest (NCI) for direct ownership only.
    We recommend that you always select this check box as we plan to retire the ability to calculate NCI for indirect ownership in a future update.
    Workday automatically calculates indirect NCI when the intermediate parent is 100% owned. When the intermediate parent is not 100% owned, you need to run equity pickup to get the true indirect NCI. This occurs because direct NCI takes the portion of the subsidiary that the intermediate parent owns, based on the amount picked up by equity pickup, to calculate the true indirect NCI.
    Workday doesn’t display this check box if your tenant is configured to calculate NCI by ownership.
    NCI Source Ledger Accounts/Summaries
    Select the ledger account or ledger account summaries that you want to use for calculating NCI activity. These are typically:
    • Equity accounts.
    • Net income accounts.
    • Other Comprehensive Income (OCI) accounts.
    Include all equity accounts that:
    • Represent ownership consistent with the ownership table of the subsidiary. Consider that some ownership equity accounts might not be attributable to additional parties. Example: Particular series of preferred stock.
    • Survive consolidation. These represent the OCI accounts. Exclude accounts that are assigned to translation gain or loss account posting.
    When you've selected the
    Direct Ownership Only (Always Select)
     check box, we recommend that you take these actions when you select ledger account summaries for parent companies in company hierarchies, to prevent double counting:
    • Exclude the earnings in subsidiary accounts in the parent companies from the ledger account summaries.
    • Create a separate ledger account summary for the earnings in subsidiary accounts.
    NCI Attribution Method
    Select either of these methods to calculate NCI activity:
    • Claim on Assets %
    • Ownership %
    To change the percentages, access the
    Edit Company Ownership Details
     task from the related actions menu of the subsidiary company.
    NCI Target Ledger Account
    Select a ledger account to record NCI eliminations to that offsets the NCI equity account.
    For net income accounts, this is typically the NCI expense account on the income statement. For equity accounts, this is typically the same as the source account.
    Ownership Change Adjustment Account
    Select a ledger account that isn't retired to record the ownership change adjustments. For equity accounts, select the same account as the source account.
    When you update ownership details, Workday calculates ownership change adjustments based on the activity posted to date in the source ledger accounts that you define on the NCI rule. It records the ownership change adjustments to the ledger account that you select.
    Workday calculates ownership adjustment separately on prior year activity and current year activity to date.
    If you don't select a ledger account, the
    Run Noncontrolling Interest
     task won't calculate ownership change adjustments even when there are ownership changes in the period that you run the task for.
    NCI Offset Ledger Account
    Define the NCI offsetting ledger account that you want to use for balancing NCI target ledger accounts. You can use a different account for each elimination rule to facilitate reconciliation.
This example illustrates some elimination rules for noncontrolling interest.
Direct Ownership Only (Always Select)
NCI Rule Name
NCI Source Ledger Accounts/Summaries
NCI Attribution Method
NCI Target Ledger Amount
Ownership Change Adjustment Account
NCI Offset Ledger Account
Yes
NCI Activity
Standard: Income Statement Accounts
Ownership %
8850:NCI Expense
3120:Additional Paid In Capital
3000:NCI Equity
Yes
NCI Equity
3100:Capital Stock
Ownership %
3100:Capital Stock
3100:Capital Stock
3000:NCI Equity
Yes
NCI Revaluation Reserve
3600:Revaluation Reserve
Ownership %
3600:Revaluation Reserve
3600:Revaluation Reserve
3000:NCI Equity
Run noncontrolling interest.