Example of Performing a Mass Reversal of Distributions

In this example, the partners in a joint venture dispute the charges for a particular set of costs that they were billed in the 1st quarter of the calendar year. They maintain that the costs were not part of the joint operating agreement.

The joint venture accountant researches the joint venture setup and discovers that an account shouldn’t be included in the account set for identifying distributable accounts for the joint venture. The accountant corrects the setup issue so that no further transactions with the account information are distributed. The following image shows how the accountant corrected the issue in the account. The accountant added a second filter to exclude the account that isn’t distributable.

This image shows a filter set with two filters, the purpose which is described in the surrounding text.

The image shows that in segment HEPPAccount, all accounts with values between 40000 and 49999, except for account value 44100, are set as distributable for the joint venture.

Next, the joint venture accountant runs the adjustments process to reverse the distributions that were billed in error. In the “Process Joint Venture Adjustments” process, the accountant completes the following parameters to identify the transactions whose distributions need to be reversed:

Parameter	Value
Processing Mode	Create Joint Venture Distribution Reversals
Reversal Source	Distributions for selected transactions
Joint Venture	Alberta
Transaction from Date	01/01/2022
Transaction to Date	03/31/2022
Account	02-100-1420-44100
Transaction Status After Reversal	Reversed
Transaction Reversal Reason	Setup issue

The following image shows the completed parameters in the adjustments process:

This image shows the Process Joint Venture Adjustments process. The parameters in the image that pertain to the example are described in the surrounding text.

The adjustments process performs these actions on the distributions associated with the transactions identified by the process:

Marks the invoiced distributions as Canceled in the Distribution Line Type column.
Creates a reversed distribution for each canceled distribution to cancel out the original distribution amount.

Reversed distributions include the reason for the reversal, which is derived from the reason that the accountant selected in the adjustments process—"Setup issue.”
For the transactions whose distributions were reversed, it updates the transaction status to Reversed so that the transactions can’t be distributed again.

The accountant then runs the processes to complete the accounting of the reversed distributions.