Скачать или смотреть How Does the Full Consolidation Method Work in Financial Modeling?

Imagine you own 80% of another company. How do you report that in your financial statements? That’s where the full consolidation method comes in.

Understanding this method is essential to ensure your financials don’t show inflated revenues, duplicate expenses, or misrepresent what your business actually owns or owes.

Here’s how to solve it:

Combine the parent’s and subsidiary’s income statements.
Remove intercompany transactions to avoid double-counting.
Account for the part you don’t own (like the 20%) as minority interest.
Adjust your balance sheet to reflect both companies as one, but separate out what belongs to minority shareholders.

This ensures your financial statements show the big picture—what you control, what you own, and what’s owed to others.

Want to see it in action? Watch the video for a full walkthrough.

👉 Timestamps:

0:00 – Introduction
0:11 – Ownership & Consolidated Financials
0:31 – Combine Income Statements
0:41 – Remove Intercompany Transactions
0:51 – Account for Minority Interest
1:06 – Adjust the Balance Sheet
1:41 – Challenges of Consolidation
2:11 – Share Your Thoughts

🎥 Watch now to master the full consolidation method!

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Let us know—what’s your biggest challenge with consolidation? Share in the comments!