Look-through consolidation
look-through
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Consolidation of wealth across several structural levels, pro rata according to the shareholding percentages.
If a family holds 60 percent of a holding company that in turn holds 50 percent of a real estate company, 30 percent of the property is included in the family's wealth.
In practice
In practice, look-through consolidation rarely fails because of the calculation but because of the data: different reporting dates, currencies and valuation methods in the individual companies. A common valuation date, a base currency with documented exchange rates and showing illiquid assets with their own valuation date have proven useful. Intra-group loans and participations are eliminated, so that the family's wealth is not counted twice.
Distinctions and common mistakes
Look-through consolidation is a management view, not a consolidation under accounting standards. A common mistake is to count both the value of the holding company and the assets it holds, which inflates the family's wealth.
Relevant in: EU-wide
Related terms
- Consolidated wealth
- The overall view of a family's wealth across all banks, structures and currencies in one reporting currency.
Mentioned in these guides
- Family office software for SwitzerlandWhat Swiss family offices need from software: structures across jurisdictions, AML due diligence, automatic exchange of information and Swiss data storage.
- Look-through consolidation: seeing wealth through structuresHow look-through consolidation allocates assets through holdings, foundations and trusts pro rata – the method, pitfalls and what it means for reporting.
- The family foundation in Switzerland: purpose, limits, administrationWhat a Swiss family foundation may and may not do: permitted purposes under Art. 335 ZGB, maintenance foundations, register duty, reform status and taxation.