Consolidation frequently asked questions

Consolidation team answers

Any Luxembourg parent company (S.A., S.à r.l., SCA) controlling one or more subsidiaries must prepare consolidated financial statements under the Law of 19 December 2002, unless the group qualifies for a size-based exemption (combined balance sheet ≤ €20m, turnover ≤ €40m, ≤ 250 employees on a consolidated basis) or for a sub-consolidation exemption when included in a higher-level EEA consolidation.
Lux GAAP follows the prudence principle, historical cost, and reduced disclosures, with significant accounting policy options. IFRS uses fair value measurement, the control-based consolidation model under IFRS 10, mandatory ECL impairment under IFRS 9, and far more extensive disclosures. IFRS is preferred for cross-border financing, listed entities, and institutional investor reporting; Lux GAAP suits unlisted family-owned and industrial groups.
Consolidation as a Service (CaaS) is a recurring outsourced engagement in which Financial Services Luxembourg replaces or reinforces the internal consolidation function of a group. Deliverables include monthly, quarterly and year-end consolidated financial statements, intercompany reconciliation, reporting packages, audit liaison and continuous improvement of the consolidation manual, all on a fixed annual fee.
Yes. Consolidation outsourcing is permitted and frequently used by international groups, SOPARFI structures and private equity managers. The parent company retains accountability for the financial statements while we produce the consolidation, intercompany matrix, eliminations and disclosures.
A typical mid-size group with 5 to 15 entities can be consolidated in 3 to 6 weeks for a year-end closing once data is collected. A first-time IFRS consolidation including gap analysis, opening balance sheet adjustments and disclosure preparation takes between 8 and 14 weeks.
We work with SAP Financial Consolidation, Talentia CPM, LucaNet, Oracle HFM/FCCS, Tagetik, and Excel-based consolidation environments. We also assist clients with selection, implementation, parallel runs, and migration projects.
Yes. We prepare audit-ready consolidation files (audit trail, reconciliations, supporting documentation, disclosure notes) and act as the single point of contact with Big 4 and statutory auditors throughout the audit cycle, managing PBC lists and resolving audit queries.
Intercompany eliminations remove transactions and balances occurring between entities of the same consolidation scope: intercompany sales and purchases, internal margins on inventory, intercompany loans and accrued interest, intercompany dividends, and unrealised gains on intra-group asset transfers. They are required to present the group as a single economic entity.
Annual consolidation engagements at Financial Services Luxembourg start from €12,000 for compact SOPARFI structures and scale up to €180,000+ for IFRS multi-currency groups with 30+ entities. Fixed-fee, capped, and time-and-materials models are available.
IFRS 10 — Consolidated Financial Statements is the IFRS standard defining the control principle: an investor consolidates an investee when it has power, exposure to variable returns, and the ability to use its power to affect those returns. IFRS 10 replaced IAS 27 (consolidation aspects) and SIC-12 in 2013.
The equity method, governed by IAS 28, is used to account for investments in associates (significant influence, typically 20% to 50% voting rights) and joint ventures. The investment is initially recognised at cost and subsequently adjusted for the investor's share of post-acquisition profit or loss, dividends received and other comprehensive income movements.
Yes. SOPARFI groups represent a significant share of our consolidation portfolio. We handle Luxembourg holding consolidation under both Lux GAAP and IFRS, including the participation exemption disclosures, dividend elimination, and goodwill amortisation policy under Lux GAAP versus impairment testing under IFRS.
Yes. We support private equity managers, RAIF master-feeder structures, parallel funds, and SCSp partnerships with portfolio company consolidation, NAV reporting reconciliation, IFRS 10 investment entity assessment, fair value through profit or loss measurement under IFRS 9, and LP reporting packages.
An external consolidation department is an outsourced team performing the entire consolidation function on behalf of a group, including chart of accounts harmonisation, scope management, data collection from subsidiaries, intercompany reconciliation, consolidation entries, reporting and audit liaison. It removes the need to recruit and retain in-house consolidation specialists.
Yes. We provide interim consolidation managers and senior consolidation accountants for 4 to 16 week reinforcement assignments during year-end closing, audit season, IFRS transitions, M&A integrations, ERP migrations, and emergency staff replacements.
Yes. Multi-currency consolidation is a core competency. We apply IAS 21 foreign currency translation, including closing-rate method for assets and liabilities, average-rate method for income statement items, and recognition of currency translation differences in other comprehensive income.
Yes. We prepare IFRS 1 first-time adoption opening balance sheets, identify all required adjustments, document elections and exemptions, prepare the reconciliation between Lux GAAP and IFRS equity, and produce the disclosure narrative for the first IFRS financial statements.
Purchase price allocation under IFRS 3 is the process of allocating the consideration transferred in a business combination to the identifiable assets acquired and liabilities assumed at fair value, with any residual recognised as goodwill. PPA may require independent valuation of intangibles such as customer relationships, technology, and brands.
Financial Services Accountant Luxembourg S.à r.l.-S operates under Luxembourg Ministry of Economy authorisation 10077274/2 and 10077274/0, and is registered under RCS B213987. Our Managing Director Mickaël LOC holds the Luxembourg expert-comptable mémorialiste qualification.
Yes. We deliver consolidated financial statements and reporting packages and in English. Luxembourg statutory consolidated accounts may be filed in any of the three official languages: French or English.
A reporting package is the structured set of financial and non-financial data submitted by each subsidiary to the group's consolidation team. It typically includes trial balance, intercompany positions, segment information, taxation data, off-balance-sheet commitments, and notes-related information. We design reporting packages tailored to each group's accounting policies and reporting cycle.
Yes. We compute deferred tax assets and liabilities under IAS 12 across the consolidation scope, including temporary differences from PPA adjustments, tax loss carry-forwards (with recoverability assessment), recognition of deferred tax on undistributed earnings of subsidiaries, and movement explanations for the tax reconciliation.
Yes. We perform Excel-to-tool migrations to SAP FC, Talentia CPM or LucaNet, including scope modelling, chart of accounts harmonisation, intercompany matrix design, automated controls implementation, parallel run validation, and final cutover with audit trail documentation.
Yes. We perform Excel-to-tool migrations to SAP FC, Talentia CPM or LucaNet, including scope modelling, chart of accounts harmonisation, intercompany matrix design, automated controls implementation, parallel run validation, and final cutover with audit trail documentation.
We work across SOPARFI holdings, private equity and venture capital, real estate (RAIF, FCP-RAIF, SCSp), industrial groups (manufacturing, automotive, aluminium), construction, technology, family offices, and international SMEs. Our consolidation specialists rotate across at least 12 sectors annually.
We act as a single contact point with the réviseur d'entreprises agréé and Big 4 audit teams. We manage the PBC list, deliver audit working papers in the auditor's format, document accounting positions, defend technical conclusions, and resolve audit findings before issuance of the audit report.