Basis in Advanced Portfolio

[David Carlson]

On 4/12/2013 1:40 PM, David Carlson wrote:
> On 4/12/2013 12:19 PM, Bill Michaelson wrote:
>> On 04/12/2013 01:05 PM, John Ralls wrote:
>>> On Apr 12, 2013, at 9:48 AM, "Bill Michaelson, Developer"
>>> <bill at cosi.com> wrote:
>>>
>>>> I see clues about that I can change the method used for basis
>>>> calculation (FIFO, average, LIFO).  But I can't seem to find the
>>>> choice in the user interface to try setting it.  Seems like a dumb
>>>> question, but well, there you have it.
>>>>
>>>> Advice, anyone?
>>> There are hooks in place for other basis calculation methods, but
>>> only FIFO is implemented.
>>>
>>> Regards,
>>> John Ralls
>>>
>>>
>> Thanks for your reply John.  I'm disappointed because I thought I
>> needed to change to FIFO to solve a problem.  I suspected I was
>> getting average basis method.  I have a case where I record a spinoff
>> by entering a split.  Prior to entering the transaction, the Advanced
>> Portfolio report shows a basis that I expect - for the original
>> purchase price of the share lots.  The split contains:
>>
>>  * a complete "sale" of all shares in the original company at the basis
>>    price
>>  * a repurchase of the same number of shares at the new basis value
>>  * a purchase of shares in the spinoff company for cash equal to the
>>    difference in basis
>>
>> Thus, I intend to have the same basis spread over both sets of stock
>> positions.
>>
>> BUT
>>
>> I find that the Advanced Portfolio report instead now shows a basis
>> for the original company as halfway between the old and the new
>> basis.  I can't imagine why.  I suspected it was some kind of
>> averaging at play.  Now I don't know what to think.  I will have to
>> keep a record of basis outside of GC, I suppose.  Can anyone explain
>> what is happening?  Is it a bug or am I missing a key point?
>>
>>
>>
>>
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> This is interesting.  My wife has been participating in an employer
> 401(k) for many years but she recently was 'spun-off' with a lot of
> co-workers to a new company with a new 401(k).  The documentation that
> the two 401(k)s provided suggests that they may have done a hybrid of
> reporting some transfers as you have done using the 'book' value for
> the basis, and for some securities using the market value.  They even
> complicated it by splitting the original company shares in the old
> 401(k) then transferring shares of both companies (and their January
> dividends and re-investments) to the new 401(K) at slightly different
> values.
>
> I am still trying to sort that out.
>
> Now it looks like I will have more fun when I try to run that report.
>
> David C
I forgot one thing.  It seems that GnuCash does not account for
commissions and costs in realized gain calculations if they are tracked
separately instead of being buried in the cost amount of the security
and sale proceeds amount for that security.  Thus you may want to track
CG separately, anyway.

David C