What is a Profit & Loss Consolidation Report for a Distribution Company?

Profit & loss (P&L) consolidation reports are considered important month-end analysis tools for multi-entity distribution companies and are used by the office of finance to provide executives with a side-by-side and consolidated view of their business units. Some of the main functionality in this type of report is that it dynamically lists subsidiaries across the columns with an aggregate total in the far right column. The user can run the report for any month and scenario (actual, budget or forecast). The rows show account level revenues, expenses and profit figures along with sub-totals. You find an example of this type of report below.

Purpose of Profit & Loss Consolidating Reports

Distribution businesses use Profit & Loss Consolidating Reports to help executives benchmark the financial results of their business units as well as analyze consolidated figures. When used as part of good business practices in Financial Planning & Analysis (FP&A) departments, a company can improve its corporate-level decisions and agility, and it can reduce the chances that individual subsidiary performance issues go unnoticed in corporate meetings or during self-service analysis.

Profit & Loss Consolidating Report Example

Here is an example of a Consolidating Profit & Loss Report.

Example of a Profit & Loss Consolidation Report for a Distribution Company

Example of a Profit & Loss Consolidation Report for a Distribution Company

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Who Uses This Type of Report?

The typical users of this type of report are: Boards, executive teams, CFOs and controllers.

Other Reports Often Used in Conjunction with Profit & Loss Consolidating Reports

Progressive Financial Planning & Analysis (FP&A) departments sometimes use several different Profit & Loss Consolidating Reports, along with  P&L trend reports, balance sheets and cash flow statements, financial KPI dashboards and other management and control tools.

Where Does the Data for Analysis Originate From?

The Actual (historical transactions) data typically comes from enterprise resource planning (ERP) systems like: Microsoft Dynamics 365 (D365) Finance, Microsoft Dynamics 365 Business Central (D365 BC), Microsoft Dynamics AX, Microsoft Dynamics NAV, Microsoft Dynamics GP, Microsoft Dynamics SL, Sage Intacct, Sage 100, Sage 300, Sage 500, Sage X3, SAP Business One, SAP ByDesign, Acumatica, Netsuite and others.

In analyses where budgets or forecasts are used, the planning data most often originates from in-house Excel spreadsheet models or from professional corporate performance management (CPM/EPM) solutions.

What Tools are Typically used for Reporting, Planning and Dashboards?

Examples of business software used with the data and ERPs mentioned above are:

  • Native ERP report writers and query tools
  • Spreadsheets (for example Microsoft Excel)
  • Corporate Performance Management (CPM) tools (for example Solver)
  • Dashboards (for example Microsoft Power BI and Tableau)

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