Use Subledger Accounting Rules to Derive the Cutback Account for Carried Interest Cost Amounts

This topic provides examples of how to use subledger accounting rules to override the following accounts with a different account:

• The account on the source transaction originating from subledger accounting, the general ledger, and manual joint venture source transactions
• The account on joint venture overhead transactions

Example of Subledger Accounting Rules to Override the Account from Subledger Accounting, General Ledger, and Manual Joint Venture Source Transactions

For this setup, use your copy of the provided Carried Interest Cost journal entry rule set to set up subledger accounting rules to override the account from the source transaction. You can override any segment in the account such as the natural account segment or the cost center segment.

Here are the tasks that you need to perform, followed by an example of a mapping set for mapping costs in carried interest journals to cost cutback accounts:

1. Identify cost cutback accounts.
2. Create a mapping set to map the following distribution types from carried interest journals to the cutback accounts:
   • A - Assets
   • B - Billable Assets
   • E – Expenses
   • S – Manual cost joint venture source transactions created in Joint Venture Management
3. Create an account rule for the mapping set.

4. Add the account rule to your copy of the provided Carried Interest Cost journal entry rule set.

   Make sure to add the account rule to the column representing the natural account segment of the chart of accounts.

5. Assign the journal entry rule set to the accounting method in the primary ledger of the joint venture.

   When you add a row for assigning the journal entry rule set, make sure to select Carried Interest Cost for the event class and All for the event type.

6. To complete the setup, you must run the Update Subledger Application Options program before creating any events for the primary ledger and Joint Ventures application.

The following image shows an example of a mapping set for overriding the account from subledger accounting, general ledger, and manual transactions. The purpose of the mapping set is to replace the natural account segment in the account from the transaction.

As shown in the example, make sure to specify these values in your mapping set:

• Output Type. Select Segment.

  Note: When you access Create Mapping Sets from the Joint Venture Management functional area, Joint Ventures is selected by default for the subledger application. You can’t change this value.
• Input Source. Search for and select Distribution Type, the one that’s associated with the Cost Transfer event class.
• Chart of Accounts. Select the chart of accounts associated with the primary ledger of the joint venture, which is HEPPLedger in this example.

• Mappings. Add mappings for each distribution type. The example shows the mapping for each type of distribution:

  • Distribution type A (Asset) to cutback account 17999 (JV Capital Cutback)
  • Distribution type B (Billable Asset) to cutback account 17999 (JV Capital Cutback)
  • Distribution type E (Expense) to cutback account 59999 (JV Expense Cutback)

  In this example, carried interest distributions with a value of A will output a value of 17999 for the HEPPAccount segment. Likewise, carried interest distributions with a value of B will output 17999 and distributions with a value of E will output 59999. Also, if you’re using manual costs, you’ll need to add a row for the cutback account for manual costs, which is distribution type S.

Example of a Mapping Set to Override the Account from Joint Venture Overhead Transactions

For carried interest journals with overhead charges, instead of a cutback account, you need to account for overhead amounts in a separate cost recovery or revenue account, depending upon your business needs.

To derive the accounts, perform the same tasks that you would to derive a cutback account. When you set up a mapping set, map the following carried interest distribution types from carried interest journals to the cost recovery or revenue account:

• Carried interest distribution type F (Fees and other charges)
• Carried interest distribution type H (Overhead)