[USCPA Career] How is it useful in consolidated accounting for global companies? A thorough explanation of the differences from standalone accounting
Among those interested in accounting at foreign-affiliated or global companies, many may still only have a vague image of what the job of "consolidated accounting" entails.
In this article, I will explain in an easy-to-understand manner:
"What is the difference between standalone accounting and consolidated accounting?"
"Why is a USCPA strongly sought after for consolidated accounting positions?"
The decisive difference between standalone accounting and consolidated accounting
While standalone accounting is
"the job of recording transactions that occurred within the company and preparing the company's own financial statements,"
consolidated accounting is
"the job of collecting and verifying figures and information from each subsidiary by the deadline, and consolidating the entire group."
It is not just about collecting the figures that come up.
Work arises to verify whether the data submitted by subsidiaries (such as TBs and intercompany transaction data) is correct, and
whether the reconciliation of accounting standards has been done correctly.
is the work that occurs.
Furthermore, since there is a responsibility to explain to management "why the figures fluctuated" after finally creating the consolidated financial statements, it is necessary to have a firm grasp of the background of the figures.
Three reasons why the strengths of a USCPA are demonstrated in consolidated accounting
USCPAs are highly valued, especially in the "overseas subsidiary management" roles of Japanese global companies. The reasons are mainly the following three.
1. Accounting communication in English
Data submitted by overseas subsidiaries is in English, and it is necessary to conduct all questions, confirmations, and sometimes even guidance on accounting treatments with local staff in English.
Since it requires not just the ability to speak English, but the "ability to understand and communicate accounting content in English," the learning experience of a USCPA is directly applicable.
2. Understanding diverse accounting standards
Since overseas subsidiaries often prepare their books using local accounting standards, the task of converting them into the standards adopted by the group, such as IFRS or US GAAP, occurs on a daily basis.
The sense for non-Japanese accounting standards gained through USCPA studies is directly applicable.
3. Verification and analytical skills cultivated in AUD (Auditing)
Auditing sensibilities learned in the USCPA AUD (Auditing) subject, such as
"having a sense of discomfort with numbers,"
"asking questions to confirm the background,"
"and checking if explanations and numbers are logically connected,"
are extremely powerful weapons for checking figures across a wide variety of standards and ensuring the validity of the group's overall numbers.
The "next step" career opened up by experience in consolidated financial statements
By gaining a perspective from the "preparer" side to the "consolidator" side through consolidated financial statements, your ability to view the group's overall numbers will deepen dramatically.
This experience will be highly useful when stepping up to positions deeply involved in management decision-making, such as FP&A (Financial Planning & Analysis) or CFO (Chief Financial Officer) at foreign-affiliated companies in the future.
For those who want to know more!
The content of this article is discussed in more detail, including realistic behind-the-scenes stories, in the video on the YouTube channel "USCPA Doko Channel".
Also, for those who want to review carefully with text, we have prepared a blog post on the "USCPA Doko Blog".
Please be sure to check it out from the link below!
Watch on YouTube
Read in detail on the blog post
I would be happy if you could also refer to my book, "The Book to Read If You Want to Become a USCPA"!