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It will also report all of the liabilities of the economic entity.

(Amounts owed and receivable between NEP and MGC are eliminated in the consolidated balance sheet.) This is a very brief overview of consolidated financial statements.

When it comes time to report results, consolidated financial statements and stand-alone statements provide two ways of looking at the companies' performance.

A consolidated financial statement covers the activities of the parent company and its subsidiaries in a single report, as if they were all a single company operating under one roof.

For investors, a company's financial statements offers insight into the health of the company.(Since the sales of electricity from NEP to MGC and the sales of gas from MGC to NEP are not earned outside of the economic entity they are eliminated.) The consolidated income statement will also report all of the expenses that were incurred outside of the economic entity.(Since the purchases of electricity by MGC from NEP and the purchases of gas by NEP from MGC did not occur outside of the economic entity they are also eliminated.) The .It's common for companies to do business with their subsidiaries -- and subsidiaries to do business with each other -- as if they were unrelated.An automaker, for example, might own the company that makes its transmissions, but it still pays that company for the transmissions it provides.




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