What is proportional consolidation in SAP EC-CS - Consolidation?

SAP Term: proportional consolidation

• Component: EC-CS

• Component Name: Consolidation

• Description: An accounting technique of consolidation of investments. Proportional consolidation is used for the treatment of investments in joint venture companies. The reported financial data of proportionally consolidated companies is transferred to the consolidated financial statements of the parent only to the extent of that company's percentage of ownership.

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• Key Concepts: 
  Proportional consolidation is a method of consolidating financial statements in SAP EC-CS Consolidation. It is used to combine the financial statements of multiple companies into one consolidated statement. This method takes into account the ownership structure of the companies being consolidated, and adjusts the financial statements accordingly. 
  
  How to use it: 
  In SAP EC-CS Consolidation, proportional consolidation is used to combine the financial statements of multiple companies into one consolidated statement. This is done by adjusting the financial statements according to the ownership structure of the companies being consolidated. The adjustments are made based on the percentage of ownership each company has in the other companies. 
  
  Tips & Tricks: 
  When using proportional consolidation in SAP EC-CS Consolidation, it is important to ensure that all of the companies being consolidated have accurate and up-to-date financial statements. This will ensure that the consolidated statement is accurate and reflects the true ownership structure of the companies. 
  
  Related Information: 
  Proportional consolidation is just one of many methods used for consolidating financial statements in SAP EC-CS Consolidation. Other methods include full consolidation, partial consolidation, and elimination consolidation. Each method has its own advantages and disadvantages, so it is important to understand which method is best suited for your particular situation.