The purpose of the consolidated financial statements, which are used primarily to shareholders and creditors of parent company, is to present the results of operations and financial position of the parent company and subsidiaries in a way as a group of one company. It is assumed that the consolidated financial statements are significant then individual reports and they are usually necessary to create a real and objective view of business operations in case one of the companies in the group, either directly or indirectly, has a controlling financial interest in other companies. Due that attention from users of the financial statements of an entity is focused on the accounting, legal separation between the two corporations that are actually one economic unit (subject) is more considered the question of form, rather than core, so that their legal separation is ignored for the purposes of accounting reporting. Transactions between related parties are left out from the consolidated financial statements because parties are not independent parties in terms of the economic entity. The consolidated financial statements should reflect only the business transactions between the accounting entity and unrelated outsiders, otherwise users might get the wrong impression, thinking that transactions between related companies are actually events occurring with the others and becouse that they will made inappropriate conclusions regarding sales revenues and earned income.