What are the differences between the two Consolidation Methods?
There are two methods to consolidate files in Working Papers.
- Real-time Consolidation (Internal)
- Batch Consolidation (External)
Both consolidation methods have its advantages and disadvantages, and the choice depends on how you wish the data from your subsidiaries and divisions to be consolidated into your parent company.
Real-time Consolidation (internal)
Consolidation can be done within a file at multiple levels and updated in real-time.
Advantages
| Disadvantages
|
- Allows entry of general ledger detail
| - The user must sign out/check out to work on an entity (copies whole file)
|
- Facilities monthly and quarterly statements since all other entry details are maintained
| - For very large internal consolidation files, there is a greater risk of running into the general limitation of 2GB for any of the files that make up the client file (e.g. .dbf, .fpt, .cdx)
|
- Only one file needs to be maintained
| - Where sub entities require their own separate work papers (i.e. separate engagements), the document manager of the internal consolidated file can become unwieldy
|
Batch consolidation (external)
Working Papers also allows consolidation to be made from external subsidiary files.
Advantages
| Disadvantages
|
- Facilitates remote use of individual entities by allowing users to work on an entity out in the field or different location
| - Many client files need to be maintained and kept track of
|
- Audit planning process and working papers:
- Audit plans and documentation for a group of related entities can be placed in a single consolidated file
- each external entity maintaining its own audit plans and work papers
| - Sign out may require the user to reconnect the file paths to all of the external files
|
- Easier to maintain if separate reporting is required for each entity
| - Detailed general ledger transactions are not maintained in the consolidated file; they can only be viewed from the externalclient file
|
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