Wealth & reporting
Look-through consolidation: seeing wealth through structures
Updated: · Leutrim Miftaraj, FLIORE · Editorial standards · Deutsche Fassung
Short answer
Look-through consolidation allocates the assets of holdings, foundations and trusts pro rata to the persons or family branches behind them. Instead of "60 per cent of Holding AG", the report shows the actual shares, properties and accounts, weighted by the ownership percentage. This makes allocation, risks and currencies visible across all levels – without double counting.
The problem without look-through
Typical family wealth sits on several levels: private accounts, a holding, the holding's investments, a family foundation with its own custody accounts. Looking only at the level of family members shows investments as a single position with a book or estimated value. How much of it is in equities, property or cash, and in which currency, stays hidden. Adding every level in full, on the other hand, double counts.
How the method works
- Record the structure with all ownership percentages, level by level.
- Value the assets and liabilities of each unit at current values.
- Replace holdings in units within the structure with their pro-rata assets.
- Multiply percentages across levels (60 per cent of a holding that owns 50 per cent equals 30 per cent).
- Combine the result per person, family branch or whole family in the reporting currency.
An example
The family owns 100 per cent of a holding with securities of 20 million and 70 per cent of a property company. The latter owns properties worth 30 million with mortgages of 12 million. Without look-through, two investments appear. With look-through, the report shows 20 million in securities, 21 million in property and 8.4 million of mortgage debt – and therefore a realistic allocation and leverage.
Pitfalls
- Foundations and discretionary trusts: to whom are assets allocated? They are often shown as a separate part of family wealth rather than attributed to individuals.
- Minority holdings without detailed data: these remain a position, clearly flagged.
- Different reporting dates and valuation methods in the units.
- Loans between units within the structure, which must net out.
- Deferred taxes that would arise if the structure were dissolved.
What look-through is for
It reveals concentration risks that only arise across levels, such as the same share in the holding and in a private account. It shows the true currency exposure, supports succession planning with values per family branch and provides the basis for the family balance sheet.
In FLIORE
FLIORE links mandates through holdings with percentages and consolidates assets, liabilities and accounts pro rata through the structures – in several currencies and with a selectable reporting currency. The structure graph shows where each figure comes from.
At a glance
| Principle | Pro-rata allocation of assets across all levels |
|---|---|
| Calculation rule | Percentages are multiplied across levels |
| Benefit | True allocation, concentration risks, currency exposure, no double counting |
Frequently asked questions
Is look-through the same as group consolidation?
No. Statutory consolidation follows control and accounting standards. Look-through in a family office is an economic view for decisions and allocates pro rata, including minority holdings.
How are foundations treated?
Since a foundation owns itself, its assets are usually shown as a separate part of family wealth. Attribution to individual beneficiaries only makes sense where entitlements are fixed.
Does look-through need current valuations of all units?
The more current, the more meaningful. Where only annual values exist, the reporting date should be visible so that readers can judge how current the figures are.
Does look-through work in a spreadsheet?
With two levels and few positions, yes. As the structure grows, formulas become error-prone because every change of a percentage affects all dependent calculations.
Sources
- Global Investment Performance Standards (GIPS) – CFA Institute
- CFA Institute – Performance measurement
- IFRS Foundation – IFRS 10 Consolidated financial statements (distinction from consolidation)
This page provides orientation and does not replace legal or tax advice. The cited legal sources in their applicable version are authoritative.
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