Accounting question

[AccTaxMan]

A question about a Form 1120S balance sheet (Schedule L) and AAA account (Schedule M-2). As for the following two figures:

(1) The year end balance of the AAA account on line 8 of the Schedule M-2

and

(2) The year end retained earnings on line 24 colume(d) of the Schedule L

Must these two figures be the same?

Thank you.

[Uncle Sam]

Not necessarily.

There are any number of reasons why they won't match.

Two offhand I can think of - (and I'm sure there are many more) -

The corporation may not have started out as an S Corp - could have trapped Retained Earnings from C period.

There could have been investment earnings that were passed through to shareholders
as Other Adjustments, not as Accumulated Adjustments of operating profits.

There could have been Additional Paid In Capital.