GL Consolidation

GL Consolidation

Consolidation:
Consolidation is functionality in the General Ledger module that allows you to combine/consolidate Accounting/Financial results of multiple companies from multiple set of books (SOB), Currencies, Calendars & Accounting flexfield structures.
In other words, Consolidation is a period-end process of combining the financial results of separate subsidiaries with the parent organization to form a single, combined statement of financial results.
Consolidated data is required at the end of year usually when companies prepare their   balance sheets.

Overview of Consolidation:

• Consolidation of companies within a Set of Books
• Consolidation of companies across multiple Sets of Books in the same instance
• Consolidation of companies across multiple Sets of Books across multiple instances.
• Accounting for some companies is maintained in non-Oracle applications
• Same or Different Charts of Accounts
• Balances or Transactions
• Same or Different Calendar
• Same or Different Currency
• Balance Type
  • Actual/Translated
  • Budget
  • Statistical

Consolidation Steps:

• Create Consolidation mapping: parent and subsidiary sets of books
• Post all Journals in subsidiary set of books
• Revalue foreign currency balances in subsidiary sets of books
• Translate subsidiary balances to the functional currency of parent set of books
• Run and review trial balance report
• Transfer data from subsidiary to parent
• Run Journal import
• Post the consolidation journal in parent set of books
• Eliminate inter company balances
• Run trial balance and other financial reports

Consolidation Tools:

To consolidate financial information of the businesses two consolidation tools are there i.e.

• FSG (Financial Statement Generator)

FSG is used to consolidate financial information for businesses using single ledger as well as businesses using different ledgers that share the same Chart of Accounts & Calendar.

• GCS (Global Consolidation System)
  As name itself says, GCS is used to consolidate financial information for different Financial Systems & Geographical locations, multiple ledgers including both owned application & legacy application.

Example:

Below mentioned diagram is the example of Consolidation for Multiple countries i.e. U.S, Norway & India where Set of Books for multiple countries are consolidated.

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Bharti Patil