Blog · Data quality and reconciliation
How a company with several legal entities and currencies builds one commercial roll-up that still reconciles: the entity as a level above region, one reporting currency at stated rates per period, the rule that conversion happens once at the entity ledger and never in the report, constant-currency comparisons beside reported ones, intercompany revenue excluded by rule, and the identity that the sum of entities in reporting currency equals the consolidated figure.
A group with entities in three countries has three ledgers, three currencies and one board asking for one number. The number exists, and it reconciles, if the entity is a level in the hierarchy, the conversion happens once at stated rates, intercompany is excluded by rule, and growth is shown two ways. This guide sets out the roll-up and the identity.
Group → entity → region → team → person → account
Every account belongs to one entity. A customer served by two entities is two accounts, mapped to one group customer for concentration, and the mapping is dated.
Per entity, per period:
Reporting-currency revenue = local revenue × the period rate finance uses
On the export, with the rate recorded. The report never converts.
| Customer flag | Treatment |
|---|---|
| Affiliate of the group | Excluded from the commercial roll-up; listed |
| Third party | Included |
The entity's local total, less intercompany, in reporting currency, is its contribution to the group.
Σ entities' third-party revenue in reporting currency = consolidated revenue, within stated rounding every account in exactly one entity; every group customer's accounts mapped once
| Entity | Local revenue, this year | Last year | Local growth | Reported (period rates) | Constant currency (fixed rate) |
|---|---|---|---|---|---|
| US | $18.0m | $16.5m | +9% | +9% | +9% |
| UK | £9.2m | £9.0m | +2% | −4% | +2% |
| EU | €7.1m | €6.4m | +11% | +14% | +11% |
| Group | +6% | +7% |
The UK sold two percent more and reported four percent less. Constant currency says what sales did; reported says what the group booked. Both on the page, the rates in the footer.
| Line | Amount |
|---|---|
| Σ entities' local revenue converted | $41.8m |
| Less intercompany, listed: 14 affiliate accounts | ($1.6m) |
| Commercial roll-up | $40.2m |
| Consolidated revenue, finance | $40.2m |
| Difference | $0, within rounding |
Conversion in the report. The total changes with the day.
Intercompany included. The group's revenue exceeds what it sold to anyone.
Reported growth only. The UK team is blamed for the pound.
A customer in two entities counted twice for concentration. Top-ten share understated.
Mapped once, each entity's ledger export with its rate, the affiliate flags and the group customer mapping produce the roll-up, both growth figures and the reconciliation to the consolidated figure every period. Covirage builds this from the exports as they are. The board reporting solution describes the setup, and the account hierarchy guide covers the group customer mapping that concentration depends on.
Once, at the entity ledger, at the rate finance uses for the period, recorded on the export. Never in the report, and never at a spot rate someone looked up. A report that converts on the fly produces a total that changes with the day it is run.
Sales from one entity of the group to another. It is real revenue in the selling entity's ledger and not revenue to the group. It is excluded from the commercial roll-up by a flag on the customer, the entity's own affiliates, and the exclusion is listed so the entity's local total can be bridged to its contribution.
Because a European entity that sold exactly as much in euros can show ten percent growth or decline in dollars from the rate alone. Constant currency, at a stated fixed rate, shows the sales result; reported shows what the group booked. Both, side by side, with the rate stated.