Understanding Consolidated Financial Statements
Consolidated financial statements are an aggregated representation of an entity's entire business, including multiple divisions or subsidiaries, and must use the same accounting framework as the parent company.Formula
Consolidated Financial Statement = Entity A Financial Information + Entity B Financial Information + Entity C Financial Information + ... + Entity N Financial InformationHow do I calculate the consolidated financial statement?
It is recommended to use a consolidated financial statement to combine the financial information of all entities into a single chart of accounts. The process for this usually involves gathering information from other data sources. The financial consolidation process can be automated with the use of programs such as Sourcetable. The formula for calculating the consolidated financial statement is as follows:
Consolidated Financial Statement = Entity A Financial Information + Entity B Financial Information + Entity C Financial Information + ... + Entity N Financial Information
What is a Consolidated Financial Statement?
A consolidated financial statement is a financial statement of an entity that includes multiple divisions or subsidiaries. Companies often use the word consolidated loosely in financial statement reporting. Consolidated financial statement reporting is an aggregated reporting of an entity's entire business, as defined by the Financial Accounting Standards Board (FASB).
What is the purpose of a Consolidated Financial Statement?
The purpose of a consolidated financial statement is to provide an overview of the performance and position of the entire business, rather than just one division or subsidiary.
What is the format of a Consolidated Financial Statement?
A consolidated financial statement is usually presented in the same manner as a regular financial statement, such as an income statement, balance sheet or statement of cash flows. However, the amounts reported in the consolidated financial statement will reflect the operations of the entire business, rather than just one division or subsidiary.
Key Points
How do I calculate consolidated financial statement?
Consolidated Financial Statement = Entity A Financial Information + Entity B Financial Information + Entity C Financial Information + ... + Entity N Financial Information
Consolidated Financial Statement
Consolidated financial statements are financial statements of an entity that includes multiple divisions or subsidiaries.
Word Usage
Companies may often use the word consolidated loosely in financial statement reporting.
