For accountants who have clients with multiple entities, one of the biggest bottlenecks occurs in multi-entity consolidation. This challenge is especially pronounced in one sector in particular: family offices. Why is that, and how can you, as their trusted advisor, help combat the issue?

The Rise of Multi-Entity Organizations

To begin with, too many organizations wrestle with the issue of outdated software. Combine that with the fact that in today’s increasingly distributed world, organizations are frequently composed of multiple business entities. This may happen through acquisitions, expansions into different regions, or simply because the business model requires it. 

Each of these entities must maintain separate books, manage multiple bank accounts, file taxes appropriately, and track their own unique transactions. Yet at the same time, everyone—management, investors, and other stakeholders—needs a consolidated view of the organization’s overall financial health.

The question, of course, is how to get the big picture without losing the necessary granularity. In many legacy accounting systems, performing multi-entity consolidation is time-consuming, error-prone, and expensive. Many systems require manual data extracts into spreadsheets or unwieldy modules that are only partially integrated. In other words, you end up duplicating effort, with teams spending hours or days just to reconcile intercompany transactions and produce consolidated financial statements.

Why Family Offices Are Especially Affected

Family office clients, particularly single-family, are a prime example of why multi-entity accounting can become so burdensome. A single-family office is usually set up to manage the wealth, investments, and personal assets of a high-net-worth family. 

The complexity arises due to a variety of factors. First, family offices hold multiple properties, invest in a variety of traditional financial instruments, hold alternative investments (e.g. Bitcoin, artwork, wine, gold), manage trusts, own operating businesses, and perhaps even have philanthropic vehicles. This structure generally requires separate legal entities to reduce liability, improve reporting clarity, or meet regulatory requirements.

Although the scope of responsibility is significant, family offices typically operate with small, tight-knit teams. There might be an internal CFO, a few accountants, and some operational personnel. They are often stretched thin, managing everything from personal expenses to complex partnership structures.

Further, due to the variable nature of investment strategies and financial positions, family offices often need near real-time access to financial data. They want to see how each business entity contributes to the overall portfolio performance and have the ability to pivot quickly if needed.

Perhaps most importantly, family office staff value hands-on control and independence. They don’t want to rely on external consultants or overly complicated implementations for every single system tweak or entity change. By deploying modern software that is intuitive to configure, with built-in consolidation features, it allows them to manage day-to-day operations without ballooning consulting bills.

The Problem with Legacy Systems

In speaking with accounting teams in family offices, I frequently hear the same complaints. 

• Their current solutions provide a poor user experience
• They rely on manual data entry
• They come with a hefty price tag
• They lack the ability to handle alternative investments.  

In fact, this last item, the inability to handle all investment types, has been coming with increasing frequency. For younger generations, these alternative investments are largely weighted toward Bitcoin and other digital assets, but crypto isn’t the only area requiring purpose-built functionality. Many enterprising families now hold a significant portion of their wealth in artwork, wine, and private company investments. 
That investment purview is broad enough that families too often end up choosing an ERP designed for an institutional investment firm, or worse. Sometimes, to avoid the hefty price tag associated with an ERP, they create a hodgepodge of outdated systems and manual processes that hamper their ability to get timely, accurate insights.

Cost Savings and Efficiency Gains

For many family offices, the jump to a specialized multi-entity platform can be a turning point. Not only does it reduce manual work and the need for outside consultants, but it can also help prevent costly errors that arise from manual intercompany reconciliation. 

Over time, these efficiencies add up: instead of devoting resources to repetitive data entry, your staff can focus on higher-level tasks such as strategic planning, risk management, and scenario forecasting. In some cases, switching to a modern system can trim days or even weeks off the close process. 

This not only translates to lower labor costs but also means your family office can pivot more quickly when new investment opportunities arise. You’ll have a clear, consolidated view of your liquidity position, cash flow forecasts, and real asset valuation at a moment’s notice—capabilities that were previously only possible with a significantly larger staff or a suite of consultants.

A Path Forward for Family Offices

Family offices represent a growing segment of multi-entity organizations that are smart, nimble, and often eager for technology that can keep up with their complexity. Yet, despite strong demand, their accounting software options have historically been limited. 

They either had to hire expensive external accountants who specialized in consolidation or invest in large-scale ERP systems that were overkill for their small teams. As an industry, we’re finally seeing momentum toward cloud-based, API-driven accounting platforms that can handle everything from intercompany eliminations to automated real-time reporting. In my view, that’s not just a convenience—it’s a necessity. 

Organizations, including family offices, can no longer afford to wait until the end of the month to view their financial position and performance. They need the data as soon as possible, and they want it consolidated correctly, without a mountain of manual fixes.

Final Thoughts

Family offices are just one example of an entire wave of multi-entity organizations that depend on real-time data, integrated workflows, and accurate consolidations. My hope is that, by focusing on multi-entity functionality and by constantly innovating, we can equip these teams with the tools they deserve.

If you have family office or any multi-entity business clients, I encourage you to help re-examine the systems they rely on. Are they empowering teams with clarity and efficiency? Do they let them make strategic decisions quickly? Or are they stuck waiting on a laborious close process and endless intercompany reconciliations? If it’s the latter, there are solutions out there—and they’re built for the modern era.