Rounding can make a creditor distribution promise exceed its cash pool

The percentage looks affordable but the total differs

The proposal model starts with a fixed amount of cash and calculates an estimated payment for each creditor. After figures are rounded for presentation, the displayed payments no longer add to the stated pool. Resolve that difference before circulating the schedule. Creditors should not have to guess which of two conflicting totals represents the proposed offer.

Keep the calculation separate from the display

Retain the underlying amounts and formulas in the working model. Identify where the model rounds percentages, individual payments or totals. A displayed percentage with few decimal places may not reproduce the actual calculation. Ask the accountant to explain the method, especially if the schedule will be used to prepare proposed payment amounts later.

Start from a checked creditor list

Business.gov.au's record-keeping guidance includes invoices and payment records. Use the reconciled claim information supplied to the adviser rather than typing a second unverified list for the presentation. Record disputed and unresolved amounts as directed. Arithmetic checks cannot establish which claims are admitted or how legal priorities should apply under a particular process.

Source: business.gov.au: Record keeping

Test a small hypothetical difference

Imagine a model allocates a fixed pool across many claims, then rounds each displayed result upward. Even small changes can make the total exceed the original allocation. Compare the sum of the displayed amounts with the available pool and investigate the difference. Do not quietly reduce the last creditor's figure simply to make the spreadsheet balance.

Have the treatment settled before distribution

Ask the adviser and accountant how residual cents, changed claims and final calculations should be addressed in the proposal documents. Check that examples are labelled as estimates where appropriate. A clear method is more useful than an unexplained balancing line, and it avoids presenting a model output as a guaranteed payment entitlement.

Reperform the arithmetic after amendments

When a claim or funding amount changes, refresh the whole schedule and repeat the comparison. Keep the checked model version with the issued proposal. The review should show the available pool, the total illustrated payments and the explained difference, if any. A credible offer needs consistent numbers as well as a persuasive account of how it will be funded.