Generally accepted accounting principles requires a company to use consolidated accounting when it owns a controlling stake in another business.
In general, a controlling stake is one that involves ownership of more than 50 percent of a business.
However, when reporting financial information, the parent company is required to submit financial statements that combine their information with that of their subsidiaries.
These documents are called consolidated financial statements and allow the health of the group to be assessed as a whole, rather than piece-by-piece.
The bulk of the remaining new features consist of fine-tuning to the interface.
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In financial accounting, consolidated financial statements provide a comprehensive view of the financial position of both the parent company and its subsidiaries, rather than one company's stand-alone position.
In business, consolidation occurs when two or more businesses combine to form one new entity, with the expectation of increasing market share and profitability and the benefit of combining talent, industry expertise or technology.
The cumulative assets from the business, as well as any revenue or expenses, are recorded on the balance sheet of the parent company.For firms with multiple businesses under a single-umbrella company, there's a useful new consolidation feature that combines and summarizes financials (balance sheets, income statements, budgets and more.According to Sage 50 Peachtree's press materials, its Complete and Premium Accounting editions support companies with up to 50 employees.When one company owns a significant stake in another business -- generally defined as at least 20 percent -- it must account for that stake in its books using either consolidation or the equity method of accounting.Which method to use depends on how much it actually owns.While there are no new must-haves, Sage 50 HK Peachtree Premium Accounting comes with some useful new features.As mentioned earlier, company consolidation tools offer a competent means to combine and summarize business units.It's the software solution businesses can count on to gain the insight they need to succeed.The new Premium Accounting comes with even more reports than Pro Accounting, plus a module that tracks and analyzes employee compensation.The helpful employee compensation module tracks pay information, raises, withholding information and more to analyze labor expenses.New budgeting tools let businesses set up and maintain budgets for up to three years and compare actual performance against planned expenses.