Changing Ownership Allocations for Existing Joint Ventures
You must define and run a mass transaction to change the ownership allocation of assets in an existing joint venture. The Joint Venture Allocation table affects only newly added assets, which means that changes made to the allocation table do not affect existing joint venture assets.
Additions and deletions of participants and reallocations of equity percentages are recorded as sales transactions. This results in either a gain or a loss on the part of the selling participant. The value of the sale proceeds for the selling participants is recorded as the capital cost incurred by the buying participants.
PeopleSoft Asset Management processes these changes by retiring some portion of the equity percentage from the selling participant (to calculate gain/loss) and then transferring percentages between business units until the desired ownership ratio is achieved. The mass transaction transfers an established amount of the asset cost and quantity from one business unit to another (a one-to-one transfer). Because of this, you may need to run the mass transaction multiple times (up to the number of participating business units minus 1) to effect the desired change. For instance, if you have three original participants and want to add another, you might run the mass transaction three times: between business units 1 and 4, 2 and 4, and 3 and 4.
To change the ownership allocation of assets in an existing joint venture, PeopleSoft Asset Management is delivered with these joint venture mass transactions:
|
Mass Transaction |
Description |
|---|---|
|
JVA-Joint Venture BU Addition |
Adds a joint venture participant. |
|
JVP-Joint Vent BU Add (w/Prof) |
Adds a joint venture participant using book values from the new business unit's profile ID. |
|
JVR-Joint Venture BU Removal |
Removes a joint venture participant. |
|
JVT-JV Allocation Change |
Transfers the allocation percentages for a joint venture from one business unit to another. |
Note: After you run these changes, it is a good idea to update the allocation table to reflect the new equity percentages. Joint venture mass transactions do not affect Joint Venture Allocation tables, and you must change these tables to reflect the updated joint ventures.
In addition to selecting the appropriate mass transaction, make other selections that are specific to joint venture processing. PeopleSoft Asset Management requires a Transaction Date and an Accounting Date.
Depending on the joint venture mass transaction you select, you may also need to select a set of default values for some or all of these fields:
Field or Control |
Description |
|---|---|
Joint Venture Business Unit to Add to |
Value is inserted into INTFC_FIN table. |
Percentage of Cost |
Enter a decimal value—for example, enter 0.50 for 50 percent. |
Disposal Code |
Choose a disposal code from the available options. Disposal codes are fully described in Retiring Assets. |
Total Proceeds |
Enter 0 if there are none. |
Percentage of Quantity |
Enter a decimal value—for example, enter 0.50 for 50 percent. |
Total Removal Cost |
Enter 0 if there is none. |
Retirement Type |
Enter either Extraordinary or Ordinary to indicate how the gain or loss that results from a retirement should be reported. This is for information only. |
Retirement Convention |
Select a retirement convention. This indicates how depreciation will be calculated through retirement. |
Voluntary/Involuntary |
Enter either Voluntary or Involuntary to indicate the reason for a retirement. This is for information only. |
See Understanding Mass Transaction Manager.
Adding a Joint Venture Participant
The Mass Transaction application engine program adds a joint venture participant business unit to an existing joint venture and performs these additional functions:
Retires an established percentage of cost and quantity from one business unit and its books by using the defaults you specify for the retirement.
Adds the same percentage of cost and quantity to the new business unit and its books by using the proceeds you specify for the retirement.
Use the mass transaction JVA-Joint Venture BU Addition to add a joint venture participant. If you want to use book values from the profile ID of the new participant business unit, use the JVP-Joint Vent BU Add (w/Prof) mass transaction.
Note: Before adding a business unit to an existing joint venture, that business unit must be fully established.
Removing a Joint Venture Participant
When Mass Transaction removes a joint venture participant business unit from an existing joint venture, it also performs these functions:
Retires the total cost and quantity from one business unit and its books, using the defaults you specify for the retirement.
Adds that cost and quantity to another business unit and its books, using the proceeds you specify for the retirement.
Use the mass transaction JVA-Joint Venture BU Removal to remove a joint venture participant.
Changing Joint Venture Ownership Allocations
When the Mass Transaction process changes ownership allocations for an existing joint venture, it also performs these functions:
Retires a percentage of the cost and quantity from one business unit and its books, using the defaults specified for the retirement.
Adds that same percentage of cost and quantity to another business unit and its books, using the proceeds specified for the retirement.
Use the mass transaction JVT-JV Allocation Change to change joint venture ownership allocations.
After you run a joint venture mass transaction, use the Transaction Loader to load results of the mass transaction into the PeopleSoft Asset Management tables.