What is multi-entity consolidation?
A multi-entity company or organization has multiple locations, subsidiaries, or operations, with each entity having its own chart of accounts. While you can view financial data at an entity level, it is often difficult to roll up results to the corporate level. This is because each entity more than likely has its own individual bank accounts, jurisdictions, and perhaps tax structures.
When you deal with disparate payables entities, risk and error goes up, while financial accuracy goes down. Hence, companies that reach upwards of 4 or more entities per year start looking for solutions that can reduce manual work, lessen lengthy close times, and increase data visibility across all entities.
For multi-entity organizations, it is important to have a centralized system with access to real-time information. Many companies that streamline their multi-entity consolidations no longer rely on manual, error-prone spreadsheets, nor disparate data. Instead, they have control and visibility into real-time reporting and analytics. By having continuous access into multiple entities within a single view, executives are empowered to make strategic, data-driving decisions to propel their business forward.