連結

• Reading: れんけつ
• Romaji: renketsu
• Kanji breakdown: 連 (ren) — connect, link; 結 (ketsu) — tie, bind, unite
• Pronunciation: /ɾeŋketsɯ/

Meaning

Consolidation; linking; coupling — in accounting, the aggregation of a parent and subsidiaries into one financial statement.

In corporate accounting, 連結決算 (consolidated financial statement) aggregates the financials of a parent company and all its subsidiaries into a single report, eliminating intra-group transactions. 連結子会社 (consolidated subsidiary) is a company fully included in a parent's consolidated accounts. 連結ベース (on a consolidated basis) vs 単体ベース (on a standalone basis) is a key reporting distinction.

Examples

1. 当社グループの連結売上高は前年比十二パーセント増を達成した。 Our group achieved a twelve percent year-on-year increase in consolidated net sales.
2. 連結決算では、グループ内取引を相殺して純粋な対外業績を示す。 Consolidated financial statements eliminate intra-group transactions to present the true external performance.
3. 新たに取得した子会社は来期から連結の範囲に含まれる予定だ。 The newly acquired subsidiary is scheduled to be included within the scope of consolidation from the next fiscal year.

Usage Guide

Context: accounting, corporate finance, logistics, corporate governance

Tone: neutral

Origin & History

Compound of 連 (connect, link — as in 連続, continuous) and 結 (tie, bind — as in 結合, bond). Together they mean 'to link and bind together.' The accounting usage was formalised during post-war corporate governance reforms.

Cultural Context

Era: Modern

Generation: Adults

Social background: Business