Difference between Balance Sheet and Consolidated Balance Sheet

The balance sheet and consolidated balance sheet both represent the financial statements of the company. The consolidated balance sheet is an extension of the balance sheet. All companies prepare financial statements to know about various aspects of the business. Preparing the balance sheet is easy as compared to a consolidated balance sheet. These financial statements include information such as assets, liabilities, equity of stakeholders, and subsidiaries.

What is a Balance Sheet?

A balance sheet is defined as a financial statement that includes the assets, liabilities, and equity of the company. Balance Sheet is used as a metric that helps to evaluate the previous and present progress of the company. Mostly this balance sheet is prepared at the end of the accounting period which is 31st of March. It shows the financial position of the business in a systematic and standard form. Along with financial statements such as income statements, and statements of cash flow, the balance sheet is an important document to prepare. Balance Sheet helps to take rational decisions for the users of the statements.

What is a Consolidated Balance Sheet?

A consolidated balance sheet consists of all the assets, liabilities, equity, and ownership of holding companies and subsidiaries into a single combined document. The consolidated balance sheet is more complex and detailed as compared to the balance sheet. It consists of the details of the holding of a parent company as well as of all the subsidiaries. For the preparation of the consolidated balance sheet, the previous year’s data is not included. This consolidated balance sheet is used by agencies, internal and external stakeholders, and investors. Consolidated balance sheets are considered mandatory for big companies and companies that have their subsidiaries.

Difference between Balance Sheet and Consolidated Balance Sheet

The balance sheet and consolidated balance sheet both consist of financial statements regarding the company. Whereas the consolidated balance sheet is an extension of the balance sheet. Both differ with respect to various parameters such as purpose, scope, complexity, analysis comparative, valuation, etc. Below is the difference table showing the difference between the balance sheet and the consolidated balance sheet.

Basis	Balance Sheet	Consolidated Balance Sheet
Definition	A balance sheet is defined as a financial statement that includes the assets, liabilities, and equity of the company.	The consolidated balance sheet is defined as a financial statement that consists of all the assets, liabilities, equity, and ownership of holding companies and subsidiaries into a single combined document.
Purpose	The Balance Sheet is used to show the financial statement of a single company.	Consolidated Balance Sheet is used to show a financial statement of multiple companies such as the parent company and its subsidiaries.
Scope	As the balance sheet includes details of only one individual company it is a narrow concept.	As the consolidated balance sheet includes details of the parent company and its subsidiaries it is a wider concept.
Prepared by	The balance sheet is prepared by the individual company on its own.	The consolidated balance sheet is prepared by the parent company.
Complexity	The balance sheet is less complex than a consolidated balance sheet.	The consolidated balance sheet is more complex as it consists of details of multiple companies.
Used by	The balance sheet is used by the management, stakeholders, and investors of the company.	The consolidated balance sheet is used by agencies, internal and external stakeholders, and investors.
Analysis	Analysis of the balance sheet is easy and does not require more technical knowledge.	Analysis of the consolidated balance sheet is difficult and requires technical knowledge regarding it.
Comparatives	With the help of the previous year’s data, the comparative data is prepared in the balance sheet	While preparing a consolidated balance sheet there is no requirement of the previous year’s data.
Consolidated adjustments	In the balance sheet, there is no requirement for consolidated adjustments.	In the consolidated balance sheet, the consolidated adjustments such as transactions of intra company are eliminated
Valuation of assets	The assets present in the balance sheet are valued according to historical cost or current market value.	For the valuation of assets in the consolidated balance sheet adjustments of intra-group and fair value adjustments are required
Relevance	The balance sheet is more reliable for tax-related and legal compliance.	The consolidated balance sheet is more reliable for investors while taking investment-related decisions.