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Consolidated financial statementsare the financial statements which lead to the subsidiaries of the holding company its summative accounting figure.
They are the combined financial statements of a parent company and its subsidiaries.
Consolidated financial statements are the financial statements of a group presented as those of a single economic entity.
The consolidated financial statements enable you to determine the general health of an entire group of companies as compared to a company’s stand alone position. This is because these financial statements provide an aggregated look at the financial position of a company and its subsidiaries.
Purpose of consolidated financial statements
The key purpose of preparing consolidated financial statements is reporting the financial condition and operating result of a consolidated business group, which is considered as a single entity comprised of more than one companies under a common control.
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