Monthly group reporting: a consolidation example

Estonia's Accounting Act requires a parent company to prepare a consolidated annual report, unless an exemption applies, but management needs group figures every month. Each month, map every company's accounts to shared report lines, translate foreign-currency amounts into euros, eliminate intercompany transactions and compare the result with the budget. A step-by-step example with three companies and two ledgers follows.

Statutory consolidation and management reporting

• Statutory. Consolidation means combining the financial statements of the companies in a group as if they were a single company (Accounting Act § 27(4)). The parent prepares the group's annual report for the financial year that has ended (§ 28(1)). Among those exempt are, for example, the parent of a small group in which no company is a public interest entity (§ 29(1) to (3)), and a subsidiary that is itself a parent (an intermediate parent) whose shares all belong to a group whose parent, registered in an EEA state, must prepare and disclose an audited consolidated annual report (§ 29(5)). The same applies when the group holds at least 90 per cent of the intermediate parent's votes and all the other shareholders have approved the exemption (§ 29(6)). A company whose own securities are admitted to trading on a regulated market in Estonia or another EEA state cannot use these last two exemptions (§ 29(7)).
• Management. Group figures every month, to see whether the group is on budget. The group agrees the content and rules of the monthly report itself: which report lines, which exchange rate, and when the month's figures are locked.
• The data is the same. Both rest on the same accounting data. The annual report, its estimates and the audit remain the work of the accountant and the auditor.

The sample group

Every number in this guide is invented and illustrative. The group has three companies: parent A and subsidiary B in Estonia, and subsidiary C in Sweden. A and C use Business Central, B uses Merit Aktiva. C keeps its books in Swedish kronor.

Five steps every month

1. Accounts to shared report lines

   Each company's chart of accounts is mapped to the group's report lines: revenue, cost of sales, operating costs and so on. When the companies use different ledgers, their charts of accounts usually differ too, but the report lines are shared. The mapping table is an agreement, not a technical detail: the CFO approves it.

2. One period and one currency

   Every company's figures are taken for the same month. Amounts in Swedish kronor are translated into euros at an agreed rate. Agree which rate (for example the monthly average) and which source it comes from, so the calculation is the same every month. The rate in the example is illustrative: 11 kronor to one euro.

3. Intercompany transactions

   When A invoices C, the invoice is revenue for A and a cost for C. For the group as a whole it is an intercompany transaction, so both sides are eliminated. Check that A's sales to C and C's purchases from A match. A difference usually means that one side has not booked the entry, or has booked it with another amount or in another month. Between A and C, the exchange rate can also cause a difference.

4. Reconciliation to the books

   Before the report, each company's figures in the model are compared with its trial balance. If revenue in the model does not equal revenue in the books, the error is in the mapping table or in the data, not in the business.

5. Report and budget comparison

   The group result is compared with the budget, and every difference is tied to a company and a cause. The data shows where the difference arose; the company's manager explains why.

Example: the elimination

A invoices C a group service charge of 40 thousand euros every month. Without the elimination, the group would show 40 thousand euros more revenue than it earned from outside the group. The elimination also lowers group gross profit by 40, because A books the charge as revenue with no cost of sales against it, and C books it as an operating cost. EBITDA does not change, because the same amount leaves both A's revenue and C's costs.

The companies' revenue adds up to 1,500 thousand euros. After the elimination, group revenue is 1,460 thousand euros.

What moved group EBITDA

The budget put group EBITDA at 240 thousand euros; the actual figure was 180. The bridge chart shows how much of the gap came from each company: A −40, B −15 and C −5 thousand euros.

The largest gap came from company A. The next question is why: did sales fall short of the budget, did costs rise, or was a cost a one-off? Our worked example shows how to analyse a gap line by line.

When the companies use different ledgers

Different accounting systems are common in a group: an acquired company often keeps its own system. In our approach, the data from each system is brought into one finance model in Microsoft Fabric, and the report lines are shared by all companies. The Business Central and Merit Aktiva pages describe how the data moves.

What the model does and what stays with the accountant

• The finance model holds the agreed mappings, rates and elimination rules, and recalculates the group figures at every data refresh.
• The accountant posts the entries, closes the month and makes the accounting estimates.
• The statutory consolidated annual report and the audit remain the work of the accountant and the auditor.

Our services start with the group management view. Currency translation and intercompany eliminations are agreed separately.

Frequently asked questions

Does the monthly group report replace the consolidated annual report?

No. The monthly report is for management. When the statutory annual report is submitted to the commercial register, the members of the management board confirm that its information is accurate and complete (§ 25(2)). In practice the report is usually prepared by the accountant and, where required, audited by an auditor.

Do all the companies need the same accounting system?

No. What matters is that each system's accounts are mapped to the same report lines and that the data can be accessed.

How often are the group figures updated?

On an agreed schedule, for example daily or after the month-end close. The month's figures are final only when every company has closed the month.

Next step

If your group's monthly report is put together by hand, we can start with a finance review: we look at your systems, charts of accounts and intercompany transactions.

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Sources

• Accounting Act, English translation on Riigi Teataja, § 17(2), § 25(2) and §§ 27 to 29, version in force from 20 July 2025 to 31 December 2026, checked 23 October 2026.
• Raamatupidamise seadus, the authentic Estonian text of the same version, checked 23 October 2026.
• Sample data: an invented sample group. Companies A and B are the same as in the example on our home page.