Accounting for networks - the consolidated network approach

In the network economy a profitability analysis based on the figures of one company is not sufficient to obtain an insight into the competitiveness of the whole network. In this paper, the applicability of the consolidated financial statement as a tool for managing network profitability is analyzed. The idea of the consolidated network is presented on the basis of a conceptual analysis, derived from an action research in two company networks. Despite the fact that there are a number of barriers on the way of the consolidated network, the idea of a consolidated view on business has received a positive feedback. The recognized benefits include value creation, profit calculation and profit sharing, and some other ways to improve performance within the network. Using the consolidated network as a metaphor is a way to communicate in supply chains.