Consolidados

Consolidados, in accounting, refer to the consolidated financial statements prepared for a corporate group. These statements combine the financial information of the parent company and its subsidiaries as if the group were a single economic entity, providing a comprehensive view of its resources, obligations and results. The primary purpose is to reflect the economic reality of the group, eliminating intra-group transactions and balances to avoid double counting.

Scope and components: Consolidated statements include the assets, liabilities and equity of the parent and its subsidiaries, as well as the income and expenses of the group as a whole. They also present the non-controlling interest—the portion of subsidiaries not owned by the group. In the consolidation process, intercompany balances and transactions, such as intercompany sales, profits and debts, are eliminated to prevent duplication and to reflect only external relationships.

Methods and standards: The typical method is full consolidation, used when the parent has control over subsidiaries. For associates and joint ventures, the equity method is commonly applied or joint arrangements may follow specific accounting rules; IFRS 10 governs control-based consolidation, IFRS 11 covers joint arrangements, and proportionate consolidation is generally not allowed under IFRS for joint ventures, though some local GAAPs historically permitted it.

Presentation and content: Consolidated statements usually include the consolidated balance sheet, income statement, and cash flow statement, with a consolidated statement of changes in equity in many cases. Notes disclose accounting policies, significant judgments, and information about subsidiaries.

Significance: Consolidated financial statements are required for most groups under IFRS and many national GAAPs. They enable stakeholders to evaluate the group’s overall financial position, performance and risk exposure on a unified basis, facilitating comparability across entities and periods.