The legally required consolidation in companies is an activity that has been shaped by various accounting standards and regulatory reporting requirements since its introduction in the 1980s.The topic received great enthusiasm in controlling departments only from expert number nerds with their corresponding passion.
Viewing legal consolidation as a separate area, dry, dusty and boring with 80s yawn factor was yesterday, today legal consolidation is fast, transparent and quite attractive.Mapping financial consolidation and legal financial statements with an integrated software solution that not only refutes past-oriented reporting for governments, regulators and investors puts a smile on the faces of the controllers of this world today.
The consolidation of expenses and income (in accordance with §305 of the German Commercial Code) eliminates the intercompany expenses and income included in the individual financial statements of the companies included in the consolidated financial statements.
Capital consolidation is carried out on the basis of the equity shown in the commercial balance sheet II after revaluation. A difference on the assets side is equal to the goodwill, which is to be depreciated during subsequent consolidation in accordance with §309 I HGB.
Within the scope of debt consolidation, the receivable at A and the liability at B must be derecognized. Once again, this is in line with the concept of unity, since a company cannot have receivables or liabilities against itself.
In accordance with the provisions of Section 297 III of the German Commercial Code (HGB), groups are obliged to prepare the consolidated financial statements at the end of a financial year as if all the companies belonging to the group were a single company. This is referred to as full consolidation and means that the consolidated annual result must be adjusted for the profits and losses from deliveries and services realised between the individual group companies, the so-called intercompany results, as part of the elimination of intercompany results.
The certified legal consolidation with CoPlanner can be controlled in a structured manner and implemented in real time in a present-oriented manner. The software adapts flexibly to the requirements of the company and everything is possible from general controlling processes to data verification and inter-company reconciliation to group consolidation. The reconciliation of individual financial statements or foreign currency translation are naturally included and investors and regulatory authorities receive up-to-date reporting from the company. With the solution in accordance with IDW PS 880 standard, legal group consolidation can be implemented according to defined criteria.
- Compliance with legal requirements
- Consistency between external and internal reporting
- Holistic overview of the company's financial situation
- Reduction of effort through standardized consolidation modelsand processes
- Better collaboration thanks to workflow management
Whether it is financial / sales planning, personnel cost planning / personnel requirement planning, cost / performance accounting or the legal consolidation of various subsidiaries, with CoPlanner you have the past, the present and the future of your company firmly under control.
Tim Erben, Head of Marketing, has been working for CoPlanner Software and Consulting GmbH since 2019. Prior to that, he was Head of Digital Marketing at pmOne AG for over 9 years and worked for various companies in the fields of Business Intelligence, Performance Management and Enterprise Content Management. Tim Erben focuses on topics such as corporate / online marketing strategies, modern marketing: content, automation and analytics to drive growth.