What are the disadvantages of consolidation?

Answer 1

1. Performance

For executives, investors, analysts and owners alike, financial consolidation is the single best way to view overall performance at-a-glance. Consolidating diverse financial reports into a single financial "snapshot" gives C-Suite, finance, and stakeholders invaluable insight into the parent company's overall health. Without consolidation, it can be extremely difficult to assess financial performance among various subsidiaries.

Make the case: Consolidated reports are often preferred by stockholders and investors as a measure of a holding company's top-level, bottom-line performance, and are a valuable way to make the case for investment.

2. Strategy

With financial reports siloed among multiple entities, charting your company's overall direction can feel a bit like steering a ship with more than one map. Financial consolidation gives leadership the top-level insight they need in order to budget, forecast and plan more effectively.

3. Efficiency

By combining multiple reports into a single consolidated financial statement, finance has more time for strategic planning. Better yet, real-time consolidation by CPM software like Adaptive Insights accelerates the financial close rate and streamlines intercompany eliminations.

The mid-size to enterprise-level companies we work with frequently report that real-time consolidation via CPM software saves them days in the close process.