The process of creating financial statements for clients that combine data from multiple investments, accounts, and/or assets to provide a clear picture of the client’s overall financial position.
Consolidated reporting aggregates, cleanses, integrates, and tailors a client’s financial data to provide accurate reliable information for monitoring and decision-making. Compared to getting multiple account statements with different formats, metrics, and analyses, consolidated reporting allows a firm and its clients to track such portfolio metrics as liquidity, cash flow, rates of return, risk parameters, gaps in coverage, debt types and levels, net worth, and other factors related to the complexity of wealth and ownership.
The process of consolidated reporting (also sometimes called aggregated reporting) depends on back-office processes that gather data from external sources and seamlessly integrate information into customized reports for the client. This function may be as time-intensive as creating spreadsheets by hand or as sophisticated as using AI-enhanced technology to collect, integrate, and display data in whatever format the client requests. It may be a function performed internally by a client’s primary financial advisory firm or outsourced to a specialist service provider. Consolidated reporting also increasingly is designed to be available on demand in multiple digital formats.
See Also: Assets under administration and Assets under advisement
Investopedia. “Consolidated Financial Statements: Requirements and Examples.” Last modified August 30, 2024. https://www.investopedia.com/terms/c/consolidatedfinancialstatement.asp
Woodson, William I., and Edward V. Marshall. The Family Office: A Comprehensive Guide for Advisers, Practitioners, and Students. Columbia Business School: 2021
