The trouble with double-entry...

[Rod Engelsman]

Mark H. Wood wrote:

>
>I suspect that at least part of the problem is the dearth of books on
>bookkeeping and accounting from a personal perspective.  I trawled through
>the local big chain bookstore recently and found lots of books that teach
>you how to account for salaries and inventory and a bunch of other stuff
>that I don't have.  The only books with a personal orientation were
>"personal finance", which is mainly a codeword for "how to choose an
>online broker."
>  
>
It's more than that. For instance, Quicken and their ilk use the concept 
of income and expense categories, while Gnucash insists on calling them 
accounts. Ok. Internally, in terms of the data representation, the 
Quicken categories are the same as the Gnucash accounts. And I 
understand that the term "account" is proper from the perspective of a 
professional accountant. But a real account -- bank account, credit 
card, brokerage, bar tab... whatever -- is fundamentally different from 
things like groceries, rent, or movies. The term "category" just seems 
more in tune with the way people think about those things. The asset and 
liability accounts have a higher level of reality -- if that's not too 
metaphysical -- than the expense and income accounts if only because 
there's another party that's involved and with whom you must agree.


>  
>
>>What I'm looking for here is a tool which actually *helps* you deal with
>>the dual perspectives of solvency and liquidity -- net worth and cash
>>flow -- in a relatively straight-forward manner. This tool should not
>>only accurately track accounts, but include the budget planning tools of
>>a spreadsheet.
>>    
>>
>
>I object.  I think that accounting and budgeting should be *two* tools
>sitting atop a common data store.  The reporting engine sits next to them.
>  
>
I don't disagree with what you just said. What I would like to see is 
something like a report that would break down all my income and spending 
by month or week for a period of time and then at least give you the 
option of exporting to a spreadsheet format. Even csv would be better 
than nothing.


>  
>
>
>I have to agree with some of this.  Assets have two values:  what you paid
>(less depreciation), which is real and verifiable and should probably be
>the basis for most of your calculations, and what you could probably get
>for it today, which is conjectural and useful only for deciding whether to
>sell it.  Maybe that should be yet another tool, to keep the accounting
>interface from becoming cluttered.  Having 69 different kinds of registers
>with different sets and numbers of columns is going to be confusing and
>hard to maintain.
>  
>
I was thinking of two more columns in the registers for investment type 
assets -- current price and current valuation. I'm not sure where you're 
getting the "69 different kinds of registers" idea from. That's sounds 
like dismissive hyperbole to me.

>  
>
>>Finally, another thing I would like to see is the ability to have the
>>components of a split transactions have different dates associated with
>>them. The date you wrote the check, the date it posted to the credit
>>card account, and finally the date it cleared your bank. It would make
>>reconciling statements easier.
>>    
>>
>
>Uh?  The clearing date would be useful for a check.  The date your payment
>was posted to your card account is relevant only to that account.
>
>Actually, now that I think of it, the date a check was written has very
>little meaning either in the accounting system or even in the checkbook.
>The only reason we care at all is probably that we know it immediately and
>can jot it down in the register, while we have to wait on average 15 days
>to learn the clearing date (which is the only date with actual
>consequences for the account).
>  
>
Yeah. And the way it stands we're left with -- as you put it -- only the 
one date that has "very little meaning".  Unless you change that date to 
match your bank statement when you reconcile.

Rod