Category: Consolidation
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Managing Multiple Companies in BrizoSystem: Simplifying Financial Consolidation with Virtual Groups
As businesses grow and expand, they often find themselves managing multiple companies, subsidiaries, or business units. This structure, while beneficial for scaling operations and reducing risk, introduces a significant challenge: financial consolidation. This process involves combining financial data from multiple legal entities into a single, unified view for accurate financial reporting and analysis. BrizoSystem is…
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The Hidden Costs of Using Excel for Multi-Company Consolidation
For many small and medium-sized businesses, Excel is the go-to tool for financial management. It’s flexible, widely available, and familiar to most finance professionals. However, as your business grows and you add multiple entities, using Excel for financial consolidation can become a costly and risky choice. In this blog, we’ll explore the downsides of using…
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Understanding Intercompany Dividend Elimination in Financial Consolidation
Why Intercompany Dividends Must Be Eliminated When consolidating financial statements across multiple entities within a group, one essential adjustment is the elimination of intercompany dividends. These are dividends paid by one subsidiary to another entity within the same group—such as a holding company or another subsidiary. While dividends are legitimate transactions between companies, they must…
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Why Do We Eliminate Intercompany Transactions in Financial Consolidation?
Seeing the Group as One When a group of companies is under common control—such as a parent company with several subsidiaries—the goal of financial consolidation is to present their financials as if they were one single economic entity. This means transactions between the entities in the group are internal, not external, and do not represent…
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AI and Financial Consolidation: The Future of Multi-Entity Reporting
Introduction: A New Era in Finance Financial consolidation has traditionally been a complex, manual process requiring significant coordination across departments, countries, and systems. As businesses grow through acquisitions or international expansion, consolidation becomes even more challenging. Multiple entities mean multiple sets of financials, charts of accounts, currencies, and compliance requirements. Artificial Intelligence (AI) and Machine…
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UK GAAP vs. US GAAP: Key Differences in Financial Reporting
When operating across the UK and the US, businesses must navigate the differences between UK GAAP (Generally Accepted Accounting Practice in the UK) and US GAAP (Generally Accepted Accounting Principles in the US). While both frameworks aim to provide accurate financial reporting, they have distinct rules and approaches. 1. Principles-Based vs. Rules-Based Approach One of…
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Financial Consolidation for SMEs: Is It Necessary and How to Start?
Many SMEs believe financial consolidation is only for large enterprises, but even smaller businesses can benefit from it. Why SMEs Should Consider Financial Consolidation ✔ Better Financial Visibility: Consolidating financials across multiple entities gives a clearer picture of overall business health. ✔ Easier Decision-Making: Helps SMEs make informed strategic decisions based on accurate financial data.…
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The Impact of Different Accounting Standards on Financial Consolidation (IFRS vs. GAAP)
Financial consolidation is already a complex process, requiring businesses to aggregate financial data across multiple subsidiaries, often spanning different countries, currencies, and regulatory environments. The challenge is further amplified when companies operate under different accounting standards. The two most widely recognised frameworks—International Financial Reporting Standards (IFRS) and Generally Accepted Accounting Principles (GAAP)—introduce variations in how…
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New Feature: Virtual Groups for Flexible Financial Consolidation in BrizoSystem
In financial consolidation, companies often rely on fixed hierarchies based on legal structures. But what if you need to analyze data from a different perspective—such as by region, business unit, or operational division? BrizoSystem now introduces Virtual Groups, allowing users to create custom hierarchies beyond the default legal company structure. This feature provides greater flexibility…
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Centralised vs. Decentralised Financial Consolidation: Which Approach is Right for You?
When managing multiple entities, companies must choose between centralised and decentralised financial consolidation. Each approach has pros and cons—let’s explore them. Centralised Consolidation In this approach, the parent company controls and consolidates all financial data. ✅ Advantages: ❌ Challenges: Decentralised Consolidation Subsidiaries handle their own financial data, and reports are later combined at the group…