SmartGroup

Turn Consolidation of Financial Statements into a simpler process

SmartGroup is a MS Excel add-in built by LA INNOVATIS which helps you along the Consolidation of Financial Statements reporting process.

It is the simplest, most intuitive and efficient way of building Consolidated Financial Statements.

We will show you how we do that.

CONSOLIDATION OF FINANCIAL STATEMENTS

We know it isn’t an easy topic, even for those who regularly pore on this. SMARTGROUP will clear the path.

SMARTGROUP will help you build a consolidated trial balance. This trial balance has the following structure:

Company | Original Account | Account * | Description | Balance | Adjustments | Consolidated Balance | FS Classification

* Converted account, if applicable.

The consolidated trial balance may contain accounts that don’t show up in individual trial balances. For example, you may want to have an account for Goodwill, another for the effects of changes in foreign exchange rates, another for minority interests (non-controlling interests), etc.

The Consolidated Balance Sheet and Consolidated P&L Statement are simply an aggregation of a classified consolidated trial balance. You can set the classification rules depending on the account or group of accounts and depending on (debtor or creditor) balance. If you want to make the classification depend on the account number, account balance and also on the company code, you can set an “exception” to classification rules. We call it “exception”, but is basically another rule that comes first and depends on the company code.

Without much unnecessary effort, you will get your Consolidated Financial Statements

The consolidated trial balance method main advantage, relative to the more traditional method (summing Individual Financial Statements and then doing the consolidation adjusts) is that a consolidated trial balance has more detailed information that can help you in the preparation of Notes to the Financial Statements. With a detailed consolidated trial balance, you can easily build the Explaining Notes to the Consolidated Financial Statements.

See also:

OPTIMIZED CONSOLIDATION PROCESS

Why you should store data in a database instead of keeping it on Excel spreadsheets?

If your group has five or more companies and you need to have consolidated financial statements more than once a year, it starts to make sense that you keep historic data in a standardized manner, instead of storing data in multiple Excel files.

We love Excel, but we know Excel is for reporting and analytics. Excel is not database manager. If you search the internet “why excel should not be used as a database” you will find a lot of reasons. We guess you are reading this because you are tired of dealing with multiple Excel files every time you need to build Consolidated Financial Statements.

Having all relevant data in a database allows you to make multi-period comparisons. This may be useful both when comparing data from one company or when comparing data from consolidated group.

Another important reason why you should have your financial reporting data in a database is that you should focus on having the right process of reporting without doing repetitive work building new Excel files. When I talk about the process of reporting, in fact, I mean SQL queries. SQL queries sometime may seem hard to understand, but once they are stored as Stored Procured, you can call them passing variables like ‘Year’ and ‘Month’, and, in a second, you will see an updated table, whether it is a classified consolidated trial, a classified trial balance of an individual company, a table that lists you differences in balances between each two companies, a table that lists all the consolidation adjustments or any other table.

See also:

SmartGroup will keep an effective control of all the Consolidation of Financial Statements process.


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