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OPERATED VENTURE
The Cash Call can be raised in any of the funding currencies, maintained in the venture
masters. Cash calls for blocks operated in India to be preferably raised in funding
currency INR to maintain uniformity.The accounting entry in the Operated Venture is:
Scenario: An Operated Venture with JV-OIL (Operator) share 70% & JV-RIL(Non-
Operator) share 30% & Cash Call raised for 3,000,000 INR. The system converts the INR
cash call into the USD currency using the conversion rates maintained in SAP.
The following entry will be booked in each of the cost objects wherein the costs have
been booked.
Accounts Account Description Amount INR
786000 Main Office Expenditure 80,000
786001 Main Office Expenditure- -80,000
offset
A/C
Scenario: Actual allowable expense (GL A/c 730000-Cont-2D Seis. Process) of
200,000,000 INR (4,000,000 USD) was incurred during the period. Hence PCO (80,000
INR) is calculated as 2% (approved rate for theyear) of the cost.
5. Cutback
Once all the FI& CO process are completed, the Cutback process need to be executed, by
using the partners, in the ratio, specified in the JOA.
The following 2 entries are passed in the Operated Venture books:
Account Account Description Customer Amount INR
739985 Cont-Shadow GL -200,000,000
560200 JV Customer JV-OIL 140,000,000
560200 JV Customer JV-RIL 60,000,000
By this the total expenses are distributed in the ratio 70% JV-OIL & 30% JV-RIL and the
Operated Venture books are nullified.
OIL share of the expenses is transferred to the Non-Operated Venture books. The system
entry passed for the same is as follows:
Account Account Description Vendor Amount INR
739985 Contract Costs - JV-OIL 140,000,000
Shadow Account
Users are requested to carefully check the entries flowing as shown while doing the
Cutback in the test run first. Then only the update/final run is to be executed.
NON-OPERATED VENTURE
1. Cash Call Request
For each Non-Operated Venture, a Cash Call Request received from the Operator, needs
to be accounted in the books by using the transaction codes:
GJ05(Cash Call at the Venture level)
The accounting entry in the Non-Operated Venture is:
Account Account Description Vendor Amount INR
203501 Cash Call Request JV-OIL(Operator) 2,000,000
203502 Cash Call Offset JV-OIL(Operator) -2,000,000
Scenario: Non Operated Venture with shares JV-OIL(Non Operator) 20% & JV-
OIL(Operator) 30% & Cash Call request received for 2,000,000(OIL Share).