Learn about the process of balance sheet consolidation, where a parent company integrates and combines its financial statements into standard-form income, balance sheet, and cash flow statements.
Balance Sheet Consolidation
In finance terms, consolidation refers to the incorporation of the financial statements of all subsidiaries into the financial statements of the parent company.
Consolidation of financial statements requires the parent company to integrate and combine all its financials to create a standard-form income statement, balance sheet, and cash flow statement, as part of a set of consolidated financial statements.
In this video we will talk about the Balance Sheet Consolidation.
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To create a consolidated BS we would take the BS values of the investor and investee and add them together. And then apply transaction effects.
We will take a look at the Example of BS Consolidation in Excel in the following video.