JVA – Joint Venture Accounting
The following blog aims to introduce Joint Venture Accounting commonly known as JVA
in SAP Oil & Gas industry. In this blog we will briefly cover some
functional & technical aspects of JVA. It will help to form a strong base
foundation for beginners like me who are intending to work on the JVA.
What is JVA?
Well as said earlier JVA is also known as Joint Venture Accounting. In the upstream business
of Oil & Gas industry that engages itself in the discovery &
exploration of Oil & Gas requires considerable amount of financial
viability and risk mitigation & that’s why big companies choose to engage
in JVs to reach equilibrium in terms of money and risk.
What is Joint Operating Agreement
A Joint Operating Agreement groups a no. of Joint Ventures. A Joint Operating agreement
is always attached to a single company code. The R/3 transaction to create JOA
is GJAA. The R/3 table for JOA is T8JU.
A company code can have multiple JOA’s assigned to it but a JOA is always
linked to only one company code. A JOA can contain more than one Joint Venture.
Please see the below screen-shots.
What is a Joint Venture?
A Joint Venture is summarization of cost objects whose costs are split among the
partners. The R/3 transaction to create JOA is GJVV. The R/3 table for JV is T8JV. A Joint Venture
is always linked to a single company code & a single Joint Operating
Agreement; the same can’t be part of 2 different JOA’s. Please see the
What is Equity Type/Equity Group?
As per Figure (4); there is a field called Equity Type, an Equity Type indicates the
phase of the project. Let us a take an example, the Equity Type E01 might
represent the ‘Design Phase’ of the project. An Equity Type is linked to Equity
Group. Equity Group represents the group of partners who are participating in
that phase. Let us take an example here, the Equity group Z00 involves 4
participating partners with their individual equity share. Please see the
One of the common business processes in the JVA is change of ownership, where there is a
selling partner who sells its own shares to other business partners. The
process is handled in the standard SAP by creation of new Equity Groups and
transfer of the Equity share from the selling partner to the buying partners.
SAP has provided some BAPIs to achieve the same. The following are the list of
BAPIs that are useful in this context.
There are also some useful BAPIs in context to JOA & JV.