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Junior Member
Group: Forum Members
Last Login: 8/09/2011 4:19:34 AM
Posts: 2,
Visits: 18
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| 1. purchase 920 units @ $5.41 each + $31.90 brokerage (29 + 2.9) 2. $0.23 per unit capital repayment processed 3. $0.15 per unit capital repayment processed 4. Sold all units for a profit; 0 units remain, however asset account shows a residual value of $211.74
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MySF Administrator
Group: Administrators
Last Login: 4/11/2010 3:24:01 PM
Posts: 464,
Visits: 633
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Hi,
We have tested this process with the figures provided and have found no residual balance.
The most common cause of the residual balance is an incorrect manual opening balance transaction for the asset. If this asset was added as a historical purchase then the opening balance should have been its cost base of $5,009.10. From the figures provided it looks like the opening balance loaded was actually $5,220.84 which may have been the market value at the start of the period.
When loading historical purchases please make sure that you enter them at their cost base, not the market value. The cumulative increase / decrease in the value of the asset since its purchase should be loaded into the "Increase in Market Value" account.
To check what transactions have been posted to a given account please select the account in the System Setup > General Ledger Accounts screen and double click on it. This will open up the ledger window and you will be able to view any opening balances or other postings that may have been incorrect.
Regards,
MySF
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Junior Member
Group: Forum Members
Last Login: 8/09/2011 4:19:34 AM
Posts: 2,
Visits: 18
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I've double clicked the asset and retrieved the transactions. May be the reversals performed from transaction reporter editor have caused the issue. I've attached the transactions to this message. While the asset was disposed proportionally as a sale and a scrip for scrip rollover (to cater for the cash portion of the takeover), I did test just processing a sale for the entire amount to ensure the issue wasn't due to selling fractional units
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MySF Administrator
Group: Administrators
Last Login: 4/11/2010 3:24:01 PM
Posts: 464,
Visits: 633
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Hi,
There is a residual balance of $211.74. This is not what is shown at the bottom of the ledger report attached above because the opening balances posted at the start of each period are also included and distort the total.
The residual balance is most likely cause by the reversal of the capital repayment through the transaction reporter. When you process a capital repayment for an asset the cost base is reduced. However, reversing the transaction through the transaction reporter does not increase the cost base of the asset back to what it was. In this case there were two capital returns processed, one of which was reversed. The residual balance is the total of the two reversed capital repayments.
To fix the existing problem please transfer these amounts to capital gains taxable and non taxable accounts by processing a general journal:
DR Capital Gain Taxable $x
DR Capital Gain Non-Taxable $y
CR 1151 - AA0015 PMN... $x + $y
..where $x + $y = $211.74
We will check what modifications are needed for the reversal of transactions to ensure that cost bases are adjusted back in future.
Regards,
MySF
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