Consolidated balance sheet: description and preparation procedure

A consolidated balance sheet is a type of financial statement that fills almost every business. Using this document, it becomes possible to summarize information about the property of the organization, to track changes in the dynamics. Based on the information received, current and strategic decisions are made during the management of the enterprise. What is the balance sheet, as well as the basic principles of its preparation will be discussed below.

Balance assignment

A consolidated balance sheet is a type of financial statements that an organization provides to the IFTS. The information collected in it allows you to analyze the current activities of the company, as well as make a forecast. The balance is drawn up for a certain period (most often a year). This allows you to track changes in the property status of the organization over time.

The consolidated balance sheet is as follows:

• The property status of the company.
• Reflection of the result of activity.
• The state of finance of the organization.
• Property structure.
• Reflection of changes in the value of the organization.

It is worthwhile to understand the balance as reporting, which characterizes the activities of the organization as a whole. Therefore, this form is the main, as well as universal. Other types of financial statements complement it. For this reason, the balance sheet is called Form No. 1. This is a kind of core around which data on the results of an enterprise’s work are grouped.

The consolidated balance sheet is determined at a specific date. Comparing data over time, you can track the dynamics of the property status of the organization. The users of information summarized in the balance sheet are:

• IFTS;
• owners of the organization;
• managers of different levels;
• employees of the financial and economic services;
• representatives of state statistics;
• lenders or investors;
• sponsors;
• counterparties, partners of the organization;
• representatives of the administration of the company.

Based on the current, a forecast balance is created. In this case, a standard form established by law is applied. It is considered by both internal and external users. But for the enterprise it may be necessary to generate reports not in a standard form. In this case, the data is presented in transformable form. This allows you to consider in detail the results of current activities. Based on the information received, managers can take appropriate decisions and specific measures to improve the organization. It is very important to know the procedure for the formation of a consolidated balance sheet.

Varieties of balance forms

In a standard, generally accepted form, a consolidated balance sheet is created. Accounting and reporting allow you to obtain the necessary information for both internal and external users. Official data is provided by the IFTS. For this, information is compiled and provided in the prescribed form.

For internal use, an organization may create a report of a modified type. But this does not mean that the information will be provided to the governing bodies in this form. A modified form of balance is needed exclusively for internal use. It varies depending on the purpose of reporting and may be as follows:

• Data is taken either on a specific date, which allows you to create a balance sheet, or turnover for a certain period (working balance).
• Source data can be inventory or accounting. The choice of generalization technique depends on the purpose of the report.
• Data may be decrypted in the form of regulatory articles. These include depreciation, margin and reserves. A report can be compiled without these articles.
• You can balance only one type of activity of the organization.
• The form may be full or abbreviated.
• Balance is an equality that can be drawn up between property and the sum of capital and liabilities. In some cases, only borrowed capital is taken into account. Own resources are not taken into account when preparing the report. In a standard form, both capital and liabilities of the company are taken into account.
• A report can be prepared both for one enterprise and for several organizations. How to draw up a consolidated balance sheet for a group of companies, there is a certain methodology. In this case, the scale of generalization will be larger.
• A balance can be created for a specific event. This can be a liquidation or opening statement, as well as a dividing or unifying balance sheet.
• In addition, the property reflection of the state of the company can be compiled for a preliminary assessment, development of a forecast. The balance may be intermediate or final.

Consolidated balance sheet is a summary report for several departments of one company or group of organizations. Approaches to filling out this form are retained regardless of the approach to reflecting summary information.

Abbreviations and Terms

When compiling a consolidated balance sheet of a group of companies, accountants take into account the recommendations presented in the order of the Ministry of Finance of the Russian Federation dated 02.07.10 No. 66n. The full form with the selected articles is approved here. They are recommended to be allocated if the company has relevant data. For those sections for which information is missing, articles are not highlighted. If required, additional data is reflected in the balance sheet, which increase the reliability of reporting.

In accounting, certain terms and abbreviations are often used. They need to know in order to understand what kind of information we are talking about. The most common abbreviations that are used in preparing the consolidated balance sheet of a bank or enterprise are:

One of the most important terms of the consolidated balance sheet that every accountant should know is the minority interest. Reporting can be created for several enterprises.

In the consolidated balance sheet, the minority interest represents part of the property of a subsidiary in the total capital of the organization. It is owned by minority shareholders. A group of these owners cannot influence the management of the company, as it is in the minority.

It is worth noting that the minority interest refers to the capital of those shareholders who invested their resources in a subsidiary not directly connected with the parent organization. Such funds are indicated in the consolidated balance sheet as an item of equity or liabilities with an indefinite period.

General Reporting Principles

The consolidated balance sheet of a group of enterprises or individual production units is compiled, first of all, in a standard form. She may have notes for each article. The company decides on its own whether this column is needed in the report. Most often it is used if there are deviations from the standard form approved by the Ministry of Finance.

In some cases, the balance sheet is drawn up in a simplified form. It is used by some legal entities that meet certain requirements. In this case, the information is provided in the appropriate form. The balance is divided into sections, and there is no comment column. However, in a simplified form, some articles are combined to consolidate indicators.

There are certain rules for filling out the balance sheet. They are presented in PBU 4/99. These rules are approved by the Ministry of Finance of the Russian Federation on July 6, 1999 No. 43n. The main ones in the preparation of the consolidated balance sheet are:

1. Accounting data serves as a source of information for the preparation of the report.
2. The information on the basis of which the balance is formed should be generated on the basis of the current PBU, as well as in accordance with the accounting policy of the enterprise.
3. Data must be complete and reliable.
4. The consolidated balance sheet of a group of enterprises and branches is compiled in a generalized form throughout the organization.
5. The information presented in the report should be comparable to previous periods.
6. Articles are distinguished by the principle of materiality.
7. The reporting period is equal to the calendar year.
8. Assets and liabilities are divided into short-term (up to 12 months) and long-term (exist for more than 12 months).
9. The offset between the articles of the liability and the asset is not done, unless otherwise provided by PBU.
10. Property is measured at its net worth at the balance sheet date. At the same time, the regulatory articles are subtracted.
11. In the annual report, the data must be confirmed by an inventory.

General filling rules

The consolidated consolidated balance sheet is filled out on the basis of data on the balance in the accounts of accounting at the date of its compilation. It is important to determine the exact purpose of such work. In accordance with this compiled a consolidated balance sheet.

Since accounts at enterprises are closed on a monthly basis, financial statements are prepared with the inclusion of all months of the current year. Most often, the data are given in thousands of rubles. If the enterprise is large, the balance sheet can be drawn up in millions of rubles.

The structure provides for the division of the report into information on property and capital, through which it was financed. The asset has two main sections. These are non-current (long-term) and current (short-term) assets.

The liability is divided into three main sections. These are long-term and short-term obligations, as well as equity of the organization.

Recommendations for filling

When filling out the form, you need to be guided by certain decryption:

• Data on the cost of intangible assets and fixed assets are shown net of depreciation.
• Information on tangible and intangible search assets, R&D is filled only if available. If they are, then their amount is shown net of depreciation.
• If the company has financial investments that can be represented by loans, deposits, contributions to the development of other organizations, securities are reflected in the balance sheet by their maturity dates. They should be presented in the long and short term sections of the asset, respectively. In this case, the reserves created in case of depreciation of financial investments should be deducted from the amount.
• The data on deferred tax payments presented in the lines of fixed assets and long-term liabilities are filled in only if PBU 18/02 is applied.
• Information on stocks, including the balances of materials from TZR, goods, WIP, finished products, RBP is reduced by the amount of reserves created for depreciation of goods and materials. You also need to deduct the amount of the trade margin, if it is included in the price.
• Accounts payable are shown in full. The amount of funds that the company owes to counterparties, suppliers, employees, funds, etc. should be shown net of allowance for doubtful debts. Also separately considered are financial investments.
• The amount of VAT on advance payments can be reflected in different ways. It depends on the accounting policies adopted by the enterprise.
• Cash is recorded in the total amount (currency, cash, non-cash). Deposits, which are reflected in the lines of financial investments, are deducted from it.
• If there is an amount of additional capital in accounting, it is divided into two lines. It is shared on the basis of whether it is related to the revaluation of property.
• Retained earnings (or uncovered loss) in the consolidated balance sheet is the total for the total number of years after the reformation or preparation of the first balance sheet. If the report is interim, you need to add up the result of previous years and the amount received for the current period. At the same time, this line may reflect a negative result.
• The data on borrowed funds are reflected in the consolidated balance sheet by the term remaining to maturity. On this basis, liabilities are reflected in different sections of the liability. Accrued interest is shown in short-term debt.
• The same principle reflects estimated liabilities for reserves for future expenses.
• The BPD includes information on earmarked funding.
• In all sections there is a line to reflect other assets or liabilities. It indicates data that was not reflected in other articles.

Simplified form

In preparing the consolidated balance sheet, a simplified form may be used. However, some articles are combined. New names are provided for them:

• The article “tangible fixed assets” shows the amount of fixed assets, unfinished capital investments. In the standard report, it is divided into “Material search assets”, “Intangible search assets”, “Profitable investments in tangible assets”, “Fixed assets”.
• The article “Intangible, financial and other fixed assets” combines the amount of R&D, intangible assets and pending investments in them, long-term financial investments, deferred tax payments.
• Amounts of short-term financial investments and VAT on purchased values, receivables are reflected in the article “Financial and other current assets”.
• The amount of the authorized, reserve, additional paid-in capital, repurchased shares of your organization, revaluation and retained earnings are reflected in the article “Capital and reserves”.
• “Other long-term liabilities contain data on deferred tax and long-term estimated liabilities.
• Information about DBS, short-term assessment circumstances is indicated in “Other short-term liabilities”.

Asset Completion Guide

To form a consolidated balance sheet, you need the data of the balance of accounts at the reporting date. This requires the following information:

• To fill out the Intangible Assets article, you need to add the balance of account 04, from which the amount of account 05 is deducted. The line “Research and development results” is not taken into account.
• For the article "Results of research and development" you need to take the data shown on account 04.
• Data on tangible and intangible search assets are shown on account 08. From this, the depreciation, which is recorded on account 05 and 02, respectively, is deducted.
• To fill in the line “Fixed assets”, you need to subtract from the amount of account 01 the funds of account 02. You also need to add to the result the cost of capital investments in accounts 07, 08.
• The line “Profitable investments in material assets” is filled on the basis of data on accounts 03, 02.
• For the article “Financial investments”, information on non-current assets with a maturity of more than 12 months is selected. For this, data are taken from accounts 55 (for deposits), 58, 73 (loans to employees). This amount should be reduced by reserves for long-term investments, which are reflected in account 59.
• To fill in the line “Deferred tax assets” you need to take the account balance data 10, 11, 15, 16, 20, 21, 28, 29, 41, 43-46, 97.
• “Value added tax on acquired values” is filled out from account 19.
• To fill out the article “Accounts receivable”, you need to take the balance of accounts 60, 62, 66-71, 73, 75, 76.
• “Financial investments (net of cash equivalents)” are filled in after the selection of the amounts in current assets in the account 55, 58, 73.
• The amount of the item “Cash and cash equivalents” is shown on accounts 50-52, 55 and 57.

Passive Fill Guide

To fill the liabilities of the consolidated balance sheet do the following:

• "Authorized capital" is reflected in account 80.
• The article “Own shares repurchased from shareholders” is formed from account 81.
• “Revaluation of fixed assets” is filled after the balance of account 83 is determined. These balances relate to intangible assets and fixed assets.
• To fill in the article “Additional paid-in capital”, you also need to take into account account balance 83 (except for balances on intangible assets, fixed assets).
• The article “Reserve capital” is filled out from account 82.
• To fill in “Retained earnings, you need to determine the balance of account 84. If intermediate reporting is generated, take the balance of accounts 84 and 99.
• To fill in the line “Borrowed funds” from the account balance 67 you need to select data on long-term debt (more than 12 months). , , .
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