Example using the Proportional Method

In the following example, company A is owned by 100% and company B is owned by 70% and consolidated with the Proportional Method. A has reported a receivable from B of 200 and B has reported a payable to A of 200. The reconciliation report with the Proportional Method option will show the following values:

Table 1. Example, values reported using the proportional consolidation method
Company	Receivable	Payable	Difference
Company A Company B	200	140
External Share	-60
Total	140	140	0

The external share of company A's receivable is calculated as: (IC amount * owned percent) * (100 - owned percent of counter company) = (200*100%)*(100%-70%) = (200*30%) = 60

In the following example, A has reported a receivable from B of 250 and B has reported a payable to A of 200. The reconciliation report with the Proportional Method option will show the following values:

Table 2. Second example, values reported using the proportional consolidation method
Company	Receivable	Payable	Difference
Company A Company B	250	140
External Share	-75
Total	175	140	35