As a holder advocate, one of the most frequent questions we receive is whether a company with multiple subsidiaries and entities under its corporate umbrella can file consolidated unclaimed property reports. The unclaimed property compliance environment is complex, frustrating, and demanding for corporate America, and complex organizational structures don’t make it any easier to navigate. Conducting unclaimed property filings on a consolidated basis can create efficiencies for many holders. However, a number of factors should be considered when determining the right approach for your particular organization.
Consolidated unclaimed property filings are similar to other consolidated financial filings such as income tax filings and financial statements. Consolidated unclaimed property filings consist of one report sent to each state or filing jurisdiction, usually by a parent company, on behalf of multiple subsidiaries. This single report contains all property that would have been reported if separate reports had been prepared for each individual entity.
Consolidated reporting simplifies and streamlines the reporting process and tends to be more cost effective regardless of whether the filing process is managed internally or outsourced. It is particularly beneficial for companies with a substantial number of subsidiaries that would otherwise consistently file zero or negative reports due to limited or no unclaimed property activity. It may also be the simplest approach for companies who already consolidate financials or are running a common paymaster across its various entities.
While there are benefits of a simplified process, there are several factors to consider before deciding to file consolidated unclaimed property reports.