1. Implementing Joint Venture Management
  2. Overview of Ownership Definition Assignment Rules

Overview of Ownership Definition Assignment Rules

Ownership definition assignment rules provide the ability to assign an ownership definition or direct billed stakeholder to transactions in a specific account or set of accounts identified as distributable for a joint venture.

Assignment rules enable you to automatically process joint venture transactions according to the various stipulations for splitting revenue and expenses in a joint operating agreement. They enable you to assign different ownership definitions or direct billed stakeholders to different types of transactions in a joint venture. Here are some possible scenarios you can address with assignment rules:

  • The revenue split is different than the split of expenses for a joint venture.

    As the managing partner, you might retain a larger share of revenue for a certain period of time in order to recoup extra costs incurred during the start-up phase of a joint venture.

  • Only one partner or a subgroup of partners participate in a particular business activity of a joint venture, therefore only those partners partake in the sharing of revenue and expenses for the activity.
  • One or more partners aren't responsible for the expenses related to a particular project in a joint venture.

  • A single partner is responsible for all costs for a certain type of expense.

You can create additional assignment rules as needed throughout the life cycle of a joint venture. This enables you to adjust to the revisions in a joint operating agreement, such as when a new partner joins a joint venture, when there are changes to partner ownership percentages, and so forth.

An assignment rule contains the following details:

  • The joint venture that you're creating the assignment rule for.
  • Account information to identify the joint venture transactions to which you want to apply the assignment rule.
  • If a joint venture has project-related transactions, you can include project information in an assignment rule to identify these transactions. This applies only if you're using Oracle Joint Venture Management with Oracle Project Costing.
  • An effective date range, which is used by the process for applying assignment rules to determine whether to process the assignment rule. The process compares the effective date to the period selected for running the process. Only assignment rules with effective dates that coincide with the selected period are processed.
  • A sequence number to determine the order in which assignment rules set up for the same period of time are processed.
  • An ownership definition or direct billed stakeholder to assign to transactions.

After you set up assignment rules, see Apply Ownership Definition Assignment Rules to Joint Venture Transactions for instructions on how to process assignment rules.

Using Assignment Rules with a Default Ownership Definition

Joint Venture Management gives you flexibility when implementing ownership definition assignment rules. You can set up assignment rules for all the transactions in a joint venture. Or you can use assignment rules for only certain transactions, and use a default ownership definition in the joint venture definition to apply to the remaining transactions.