Caveat Relating to Consolidated Entities

EP can always be calculated using a consolidated figures from the income statement and balance sheet. This is the only proper method of tracking EP for a "functional" organization, whereby units below the consolidated level represent functions that do not stand alone as business units.

However, the company significantly benefits from each manager having a clearer line of sight to an EP they can more directly manage, and for which they are accountable. If the consolidated company consists of several stand-alone business units that would qualify as viable EP centers, then it would be far preferable to track consolidated EP as the sum of the EPs of the constituent business units, less any unallocated corporate costs or capital charges.