how to record bond exchange w/o basis change

[Edward Doolittle]

I don't know about your jurisdiction, and I am certainly not an expert, but
here in Canada my understanding is that exchange of one item of property
for another (e.g., shares) results in a "disposition" which could trigger
capital gain (or loss). So recording the transaction as a sale to cash
followed by a buy from cash would be appropriate. Recording the transaction
as an exchange could possibly be done, maybe using trading accounts, but
that could obscure the capital gain (or loss), assuming there is one.

This is a situation where professional advice from an accountant could be
helpful.

As for the cost basis issue, maybe report on a parent account of both bond
A and bond B, rather than reporting on bond A and bond B separately?
GnuCash isn't really the best tool for maintaining historical price
information, but if it's in the data store you could use it. But you really
need a lot of information (e.g., frequent price quotes) and somewhat
sophisticated mathematics to get interesting information (e.g., investment
growth estimates) out of historical data if cash has been deposited or
withdrawn frequently. As far as I know, GnuCash doesn't do the necessary
math, and you'd be lucky if you had all the historical price data you need
in the GnuCash data store. What you could do is export the transaction data
from GnuCash and import it into a more appropriate tool that has access to
historical information and can do the math.

As always, I look forward to corrections if I misunderstand.

On 17 February 2015 at 09:03, Larry Evans <cppljevans at suddenlink.net> wrote:

> My broker changed shares of one bond(call it bondA),
> with another(call it bondB) 1 for 1 in middle of 2014.
> I could record the exchange as sell bondA and buy bondB
> with the proceeds; however, wouldn't this require
> capGains to be calculated for bondA and then a new basis
> for bondB recorded for middle of 2014?
>
> How can GC handle this?
>
> -regards,
> Larry
>
>
> _______________________________________________
> gnucash-user mailing list
> gnucash-user at gnucash.org
> https://lists.gnucash.org/mailman/listinfo/gnucash-user
> -----
> Please remember to CC this list on all your replies.
> You can do this by using Reply-To-List or Reply-All.
>



-- 
Edward Doolittle
Associate Professor of Mathematics
First Nations University of Canada
1 First Nations Way, Regina SK S4S 7K2

« Toutes les fois que je donne une place vacante, je fais cent mécontents
et un ingrat. »
-- Louis XIV, dans Voltaire, Le Siècle de Louis XIV, Chap. XXVI