In the consolidated report, the transactions among subsidiaries or a subsidiary and a parent company are eliminated to avoid double counting.Financial reporting is much more complex for individuals and companies that hold a majority stake in more than one business.
Each subsidiary must prepare its own financial statements including balance sheet, income statement, statement of cash flows and statement of retained earnings.
(Since the sales of electricity from NEP to MGC and the sales of gas from MGC to NEP are not earned outside of the economic entity they are eliminated.) The consolidated income statement will also report all of the expenses that were incurred outside of the economic entity.
(Since the purchases of electricity by MGC from NEP and the purchases of gas by NEP from MGC did not occur outside of the economic entity they are also eliminated.) The .
These statements are prepared for an individual business and provide a snapshot of the performance of the business for a specific period – monthly, quarterly, yearly, etc.
These reports typically include a balance sheet, income statement, statement of cash flow and a shareholder equity report.
Quick Books lets you identify transactions by class, giving the user great flexibility in how to define class.