Accounting Implications of a Corporate Reorganization in Georgia

Before the legal transfer, the registration date, economic effective date, and accounting transfer date must be aligned. Depending on the structure, an interim financial statement, a closing financial statement, or a special restructuring balance sheet may be required. The companies involved should reconcile their accounts and fully record outstanding receivables, liabilities, provisions, and equity items. In a merger or division, each transferred item must be clearly assigned to the continuing or successor company. Whether existing carrying amounts are carried forward or other accounting values are recognized depends on the form of reorganization and the applicable valuation rules. Tax values must be reviewed separately from accounting values. Intra-group or reciprocal balances between the companies involved must be identified and treated in accordance with the applicable rules. The acquiring company needs verifiable opening balances and an allocation to its own chart of accounts and reporting structures. The type of reorganization, valuation bases, and material effects may need to be disclosed in the financial reports. The reporting category and financial statement and filing obligations to the Accounting, Reporting and Auditing Supervision Service (SARAS) must be reviewed again after the restructuring.