Example of Reversing Distributions to Correct Ownership Details

This example illustrates how to reverse joint venture distributions and redistribute associated transactions when ownership percentages in an active ownership definition were entered incorrectly. Unlike a retroactive ownership change, the ownership structure itself didn’t change over time. Instead, the ownership definition contained incorrect ownership percentages when it was created.

Consider a $1,000 transaction distributed using the following ownership percentages:

Stakeholder	Ownership Percentage	Distribution
Stakeholder 1	60	600
Stakeholder 2	40	400

Later, the joint venture accountant discovers that the ownership percentages were entered incorrectly and should have been 50% each.

To correct the error, the joint venture accountant updates the ownership definition and then runs the adjustments process to reverse the distributions and redistribute the transaction using the corrected ownership percentages.

The process cancels the original distributions and creates corresponding reversed distributions as illustrated in the following table:

Stakeholder	Distribution	Distribution Line Type
Stakeholder 1	600	Canceled
Stakeholder 1	-600	Reversed
Stakeholder 2	400	Canceled
Stakeholder 2	-400	Reversed

The process also redistributes the transaction using the corrected ownership percentages as illustrated in the following table:

Stakeholder	Distribution	Ownership Percentage	Distribution
Stakeholder 1	500	50	Redistributed
Stakeholder 2	500	50	Redistributed

If the original distributions were invoiced, the reversed distributions must be processed to create credit memos in Receivables.