consolidated statement

A consolidated statement is a financial report that combines the assets, liabilities, equity, income, and cash flows of a parent company and its subsidiaries into a single entity. This approach provides a comprehensive view of the entire group's financial performance, as if it were one business.123

When a parent company owns a majority interest in another company, the acquired company becomes a subsidiary. Instead of listing its investments in subsidiaries as assets, the parent company includes the subsidiaries' assets and liabilities on its own balance sheet. If minority shareholders own a portion of a subsidiary, their equity is shown separately. Consolidated statements are crucial for investors and stakeholders to understand the overall financial health and operations of a corporate group.32