Importing from Quicken

[Steve]

---- Charles Day <cedayiv at gmail.com> wrote: 
> On Sun, Mar 2, 2008 at 6:05 PM, Ian Lewis <ianmlewis at gmail.com> wrote:
> 
> > Steve,
> >
> > What I think Charles was trying to say is, If there is a standard practice
> > where you can record stock shorting using standard double-entry bookkeeping
> > then yes. If not then no.
> >
> 
> Yes, that's what I meant. Am I right in assuming that there isn't a GnuCash
> druid which guides the user in recording shorts and covers?
> 
> I'm not an expert so I'm not sure how you might do it, but my hunch is that
> > you can record these using standard double entry accounting. If someone
> > knows how to do this the or has a good way of recording shorted stocks then
> > please chime so we can update the wiki and/or documentation.
> >
> 
> I'll take another crack at this... When you short a stock, you are selling
> borrowed stock. So you have an asset (the sale proceeds) paired with a
> liability (the shares you owe to your broker). Whether you actually receive
> the cash right away doesn't matter. Your broker owes you the proceeds of the
> sale (that's your asset, much like A/R), and you owe your broker the shares
> (that's your liability).  When you later do the cover, you buy the shares
> using the asset account and deposit them into the liability account. The
> difference is your profit, which is a transfer from an income account
> ("Realized shorts", perhaps).
> 
> How does that sound?

OK. I think I've got it and yhis is what I tried to do to start with but I screwed it up somehow. I have 3 accounts: (A = Assets, E = Expense)

A:Brokerage Account
A:Brokerage Account:ABC stock
E Account:Brokerage Account:Commisions

In the brokerage account I put this transaction:

Description____________________________|_Deposit_|_Withdrawal
Short_Sell_100_ABC____________________|________|___________
_______________A:Brokerage_Account_____|_4990.0_|___________
_______________E:Commision____________|___10.0_|___________
_______________A:Brokerage_Account:ABC_|________|_5000.0_

and the corresponding ABC account looks like this:

Description____________________|_Shares_|_____|__Buy___|__Sell_|_Bal_
Short_Sell_100_ABC____________|_-100___|_____|________|__100_|_-100
_______A:Brokerage_Account_____|_______|_____|_4990.0 _|______|_____
_______E:Commision____________|_______|_____|___10.0_|______|_____
_______A:Brokerage_Account:ABC_|_-100__|_50.0_|_______|_5000.0_|___

Now to cover the short I put this transaction in the Brokerage account:

Description____________________________|_Deposit_|_Withdrawal
Buy to cover 100 ABC___________________|________|__________
______________A:Brokerage_Account_____|_4490.0_|__________
______________E:Commision____________|___10.0_|__________
______________A:Brokerage_Account:ABC_|________|__4500.0__

and the corresponding ABC account ends up like this

Description____________________|_Shares_|_____|__Buy__|___Sell__|_Bal_
Short_Sell_100_ABC____________|__100__|_____|___100_|________|___0
______A:Brokerage Account______|_______|_____|_______|_4490.0 _|___
______E:Commision____________|_______|_____|___10.0_|________|___
______A:Brokerage_Account:ABC_|__100__|_45.0_|_4500.0_|________|___

So I sold short 100 shares of ABC stock at 50.0/share with a commision of 10.0 which deposited (100 * 50.0) - 10.0 = 4990.0 into my brokerage account leaving -100 shares in the ABC account.
I then covered the short at 45.0/share with a commission of 10.0 which removes (100 * 45.0) + 10 = 4510.0. from the brokerage account and leaves a balance of 0 in the ABC account.
This gives me a realized gain of 4990.0 - 4510.0 = 480.0.

Does that look OK?

I hope you can read this OK

Steve..
> 
> -Charles
> 
> 
> > Ian
> >
> > 2008/3/3, Steve <zephod at cfl.rr.com>:
> > >
> > >
> > > ---- Charles Day <cedayiv at gmail.com> wrote:
> > >
> > > > On Sun, Mar 2, 2008 at 2:08 PM, Richard Ullger <rullger at ntlworld.com>
> > > wrote:
> > > >
> > > > >
> > > > >
> > > > > Charles Day wrote:
> > > > > >
> > > > > > That is a good question. I have not tried to enter shorts or
> > > covers in
> > > > > > GnuCash. Off the top of my head, it seems like you would need a
> > > > > "Borrowed
> > > > > > Shares:Security Name" liability account for which the underlying
> > > > > "commodity"
> > > > > > (GnuCash term) is the security being sold short. Transfer shares
> > > from
> > > > > that
> > > > > > account into your portfolio and immediately sell them. That would
> > > be the
> > > > > > short, leaving you with the cash you got from the sale plus a
> > > liability
> > > > > of
> > > > > > the borrowed shares.  For the cover, buy shares for the liability
> > > > > account.
> > > > > >
> > > > >
> > > > > When you short shares, your broker borrows the shares on your behalf
> > > and
> > > > > sells them. You do not actually realise any cash for the sale so you
> > > do
> > > > > not have that cash to go and buy more shares. When you buy to cover
> > > you
> > > > > receive the difference between the sale and the cover if there was a
> > > > > gain or your account is debited with the difference if there was a
> > > loss.
> > > > >
> > > >
> > > > Ah, yes, I had forgotten how that worked. Had I actually gotten around
> > > to
> > > > shorting ANF a few days ago as I had planned, I would have known
> > > better. :(
> > > >
> > > > Anyway, I'm sure there must be a fairly standard way of recording this
> > > type
> > > > of transaction in a double-entry accounting package. If there is not
> > > already
> > > > a GnuCash druid/wizard to drive the process, then that would be a nice
> > > > enhancement.
> > >
> > >
> > > Err.. I'm still not clear on this. Does GC 2.2.3 in fact support
> > > shorting stocks.
> > >
> > > Thanks,
> > > Steve
> > >
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> >