Simplifying Financial Statement Consolidation

On how simplifying financial statement consolidation can help your business - If you’re a business with multiple subsidiaries, separate legal entities or locations, you know all about the headaches and complexities that come with consolidating trial balance information to prepare financial statements. You want to be able to easily consolidation information from all businesses, rolling it up to the corporate level for fast, accurate analysis.

But how can you get over the hurdle of the disparate systems at the subsidiary level so that you can view information and make appropriate comparisons of each subsidiary’s financial information? An integrated software system can make your life easier.

Apples to Apples

One of the main requirements to simplifying consolidation is to have a standardized chart of accounts for all organizations or subsidiaries. With each subsidiary working off the same chart of accounts structure, consolidation is simplified.

It’s common practice for subsidiaries to utilize their own unique charts of account. While they can generate their own financial statements, when it comes time to consolidate, there’s no easy way to accomplish it. Many corporations have relied upon Excel which offers no linkage back to any of the real detail at the subsidiary level. This “system” is also very prone to human error.

In addition, without integrated software, you don’t have the ability to report the same information in the same way. For example, what if one of your subsidiaries uses the term “utility expense,” while another uses “electricity expense” and “gas expense” to categorize utilities. You’d like to compare utilities costs, but when subsidiaries are using two different charts of account definitions, it makes it difficult to compare and contrast the information you want and need for strategic decisions.

How can you make this important change? By moving to an integrated software system which has these capabilities already built in and ready for you to use.

How you’ll benefit

A robust, integrated system means your accounting and finance team spends less time and effort to produce your consolidated financials. No more manual entry to integrate spreadsheets from each subsidiary.

You’ll also gain the ability to drill into data, slicing and dicing it so you can make comparisons, examine trends and make critical decisions.

Let an integrated software system take you from a simple system to a sophisticated structure, freeing up your team’s time and saving your company’s money.

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