Purpose
If a company purchases another company, the company that was purchasedbecomes an affiliated or participating company.
Accounting principles in various countries require that receivables andpayables from affiliated, participating, and external companies have tobe displayed separately in the financial statements.
If an equity holding is changed retroactively, then it can be assumedthat postings, which were made after the date the change takes effect,but before the change was entered in the system, are not posted with thecorrect company ID (VBUND).
This report analyzes the postings of the affected business partners forthis time period, and determines the amounts and the account assignmentsfor the required adjustment postings.

Integration
As part of closing preparation, corrections related to the VBUND fieldare also integrated in the following reports: foreign currency valuation(FPW1), reclassification, and the open item list (FPO1P, Open Items atKey Date).
We recommend that you run the current report before you run the foreigncurrency valuation and reclassification reports.

Features
The report determines the adjustment requirement related to the changeto the equity holdings in the partner company or related to a change ofthe status of a business partner in relation to an affiliated company.
You use different reconciliation accounts for affiliated companies,non-affiliated companies and participating companies. The number of thetrading partner is entered in the contract accounts of the businesspartner, and the system transfers this number to the documents duringposting. You can determine the G/L accounts in a customer-specificaccount determination using the VBUND field.
Note for the industry component Insurance
Sometimes companies are required to report revenues for premiums,commissions, reserves, and claims separately for affiliated andparticipating companies. If this is the case, you can use accounts tocontrol the assignment of these amounts. In doing so, you also must usethe VBUND field in the G/L account determination for revenue and expenseaccounts.
Reserves, that is payables where the usage is known but not the amountand due date, also have to be displayed separately.
The report determines the adjustment requirement separately for:

• Receivables and payables


• Revenues and expenses


• Reserve postings for the industry component Insurance

The report views the reserves, receivables, and payables for a key date,revenues and expenses for a period.
The report can also post the adjustments needed, if necessary bybusiness partner and/or company code. For test purposes, you can alsoselect by segment and business area.
For receivables and payables, the adjustment is made using separateadjustment accounts that the system determines for each reconciliationaccount using posting area 1350. (See Customizing for Contract AccountsReceivable and Payable under Closing Operations -> Reclassifications-> Define Adjustment Accounts). The posting is performed for the keydate in local currency. The inverse posting is for the key date plus 1.
For revenues, expenses, and reserve postings, the adjustment is madedirectly to the general ledger accounts.
If you use customer-specific account determination for the revenueaccounts, in the industry component Insurance, you can implement anaccount determination at event V040.

Output
The report displays the adjustments.