Preparing consolidated financial statements can be stressful. It can be difficult to visualise exactly what to do, and where the journal entries to bring everything together should go.
By using a consolidated worksheet, the process was made a little bit easier. It’s not a wonder tool, but it sure can help a lot. There are three steps to using it…
Start off by entering in the separate financial statement information on the left-hand side of the worksheet.
Insert the required journal entries to match up with the relevant line item. As with all journal entries, make sure they balance out. If they don’t, your consolidated financial statements are missing something.
Finally, total up the line items. If you’re confused about how this should work, remember if there’s a debit in the asset section, the asset will increase. Likewise, a credit in the liability section will cause the liability to increase.
Consolidated worksheets covering the Statement of Financial Position and Statement of Comprehensive Income are available with our Guide to Consolidation Journal Entries.
These things will take time and plenty of practice, hopefully this tool will make it a little easier to understand. If you have any feedback, comments or suggestions on how to improve it, please let us know.