Close Book?

[Peter Randall]

Derek,
Very many thanks for a clear and straightforward answer. The Balance sheet
idea is perfect.

Thanks also for adding a new word to my vocabulary - 'conflate' (to mix -
according to my Concise Oxford Dictionary). I think in England we would tend
to write "you are 'confusing' your Equity Account with your Instantaneous
Equity" or " you are mistaking your Equity Account for your Instantaneous
Equity. But I also like conflate.

Thanks again
Peter Randall

On Tue, Dec 2, 2008 at 11:30 PM, Derek Atkins <warlord at mit.edu> wrote:

> Hi,
>
>
> Quoting Peter Randall <peter.randall1 at googlemail.com>:
>
>  I am trying to build my first GNUcash file for personal accounting. So far
>> I
>> have built and populated a fairly conventional structure with the usual
>> suspects. However I am struggling to make Equity respond to changes in the
>> other main accounts. For instance if I add an income item to the Current
>> (Checking) account this shows, as you might expect, as an increase in the
>> main Assets account, but it does not produce any change in the Equity
>> account.
>> I believe this might have something to do with the Close Book function
>> found
>> under the Tools drop-down menu which on one occasion did make the
>> Equity+Liability=Assets equation balance. But but now it stubbornly
>> refuses
>> to have any effect on Equity. I cannot find any reference to the 'Close
>> book' function in the Tutorial & Concepts Guide.
>>
>> Any help would be much appreciated.
>>
>
> You're conflating Equity Accounts with your Instantaneous Equity.
> Remember that the accounting equation isn't just that Eq = A - L
> but really it's Eq = A - L + In - Ex.  What this means is that Income
> and Expense count towards your Instantaneous Equity.  Some of this
> is in the FAQ:
>
> http://wiki.gnucash.org/wiki/FAQ#Q:_What_are_debits_and_credits.3F
>
> You can compute your Instantaneous Equity by running a Balance Sheet
> Report.  This is the recommended method to see your equity at any
> point in time.
>
> The Close Books functionality is new enough so it's not documented.
> However it is referenced in the FAQ:
>
> http://wiki.gnucash.org/wiki/FAQ#Q:_Is_there_book-closing_support.2C_yet.3F
>
> However you should only run this when you really want to close the books,
> like at the end of an Accounting Period (like once a year).
>
> I hope this helps.  I'm sure you'll get other replies too.
>
>  Please remember to CC this list on all your replies.
>> You can do this by using Reply-To-List or Reply-All.
>>
>
> -derek
>
> --
>      Derek Atkins, SB '93 MIT EE, SM '95 MIT Media Laboratory
>      Member, MIT Student Information Processing Board  (SIPB)
>      URL: http://web.mit.edu/warlord/    PP-ASEL-IA     N1NWH
>      warlord at MIT.EDU                        PGP key available
>
>