Joint Venture Accounting
- Thread starter Gene
- Start date
- Joined
- Sep 14, 2007
- Messages
- 40
Joint ventures are temporary partnerships. In terms of real estate, your Joint venture partnership should be binded by a JV agreement drafted by a lawyer. The partnership can end when you sell the property or if the other party wants to cash out early. All important situations should be outlined in a JV agreement to protect both of your interests. Anyways, if anyone else can clear up or add anymore JV details please do.
Remember, the most important thing is to consult a lawyer and an accountant for JV`s so your fully protected. You should look into Russel and Don`s new program, "joint venture secrets".
Remember, the most important thing is to consult a lawyer and an accountant for JV`s so your fully protected. You should look into Russel and Don`s new program, "joint venture secrets".
- Joined
- Dec 16, 2008
- Messages
- 1,005
QUOTE (Gene @ Sep 21 2007, 06:33 PM) How does two different company`s do a Joint Venture with out forming a new company for the Joint Venture? How would the reporting of the paper work on the accounting side look like.
As always, consult your accountant. What we do is have each property in a separate bank account and set up the property in quick books. You can use excel or another program. We then track the source and use of funds, cash flows and expenses. On the T776 report which is created by your accountant at each year end, the report is created and indicates the share of profits and losses.
As always, consult your accountant. What we do is have each property in a separate bank account and set up the property in quick books. You can use excel or another program. We then track the source and use of funds, cash flows and expenses. On the T776 report which is created by your accountant at each year end, the report is created and indicates the share of profits and losses.
- Joined
- Sep 29, 2007
- Messages
- 130
Good afternoon Gene,
If I can quickly add my two cents, I agree with asking your accountant. They may prefer/suggest a particular methodology that fits best with your particular situation. Your accountant may also be reflecting the JV in a couple of different manners on your financial statements.
Considerations will be given to the nature of the JV. In many cases the JV`s can be more accurately described as partnerships. However, in certain cases your accountant and lawyer may shriek in horror where this is the case. There are pros and cons to each, and a few different rules for each, thus you will want to determine which set of rules to follow.
The reporting and tax filing requirements will differ if we are speaking of what I will call for the lack of a better word a "true joint-venture" as compared to a partnership. If this is a true JV, your reporting needs/procedures should in my opinion consider the fiscal year-end of others involved with the JV.
Warm regards...
George
If I can quickly add my two cents, I agree with asking your accountant. They may prefer/suggest a particular methodology that fits best with your particular situation. Your accountant may also be reflecting the JV in a couple of different manners on your financial statements.
Considerations will be given to the nature of the JV. In many cases the JV`s can be more accurately described as partnerships. However, in certain cases your accountant and lawyer may shriek in horror where this is the case. There are pros and cons to each, and a few different rules for each, thus you will want to determine which set of rules to follow.
The reporting and tax filing requirements will differ if we are speaking of what I will call for the lack of a better word a "true joint-venture" as compared to a partnership. If this is a true JV, your reporting needs/procedures should in my opinion consider the fiscal year-end of others involved with the JV.
Warm regards...
George