The management consolidation process, especially along the economic axis, allows for aggregated business views that are often more important than those made on the single legal entity. Consolidated views on the cost of products or services, for example, are indicative of potential issues or opportunities for the group.
As well as the analysis of the Net Working Capital by BU, they could raise problems related to the financial structure that would otherwise be difficult to identify from a civil law point of view. The effectiveness and significance of the management data is, however, greater if the results are in line with the data deriving from the statutory consolidation.
For this reason, it is important to always keep an eye on the periodic reconciliation between the two views with tools/processes capable of justifying any deviations.