Need better documentation on using Lots [Was: Chapter 8 - investment accounts]

[David Carlson]

On 9/7/2015 7:08 PM, Philip Walden wrote:
> John Ralls wrote:
>>> On Sep 7, 2015, at 9:52 AM, Philip Walden <pcwalden at comcast.net> wrote:
>>>
>>> John Ralls wrote:
>>>>> On Sep 6, 2015, at 3:04 PM, Philip Walden <pcwalden at comcast.net>
>>>>> wrote:
>>>>>
>>>>>
>>>>> WRT the "Concepts of Lots", per the discussion below I want to use
>>>>> lots in my stock accounts, but the document "Lots Architecture &
>>>>> Implementation Overview" only talks about the concept and does not
>>>>> give many clues as to how one should use the View Lots... screen.
>>>>>
>>>>> For example, what does Scrub Account do? What does Scrub (a
>>>>> record) do? What does the Splits Free and Splits in Lots mean or do.
>>>>>
>>>>> I have experimented several times only to get confused as to what
>>>>> is happening and end up backing out the work for fear of going
>>>>> down a rat-hole and ruining my stock gain/loss reporting integrity.
>>>>>
>>>>> I sort of understand the concept, but how is it implemented in the
>>>>> View Lots... screen? I cannot find anything helpful in the tutorial.
>>>>>
>>>>> My particular circumstance is that I have many old stock holdings
>>>>> in several accounts with lot tracking done on paper. I'd like to
>>>>> get them into gnc if I can. So the "automatic" scrubbing and lot
>>>>> set up does not seem to work for me as I already have prior lot
>>>>> database I'd like to enter; and then it could be that I just do
>>>>> not understand the View Lots... screen and its nomenclature.
>>>>>
>>>>> Thanks in advance for any help or pointers
>>>> AS you probably know there are a variety of strategies for grouping
>>>> lots and for deciding which lot is the one you sold. GnuCash
>>>> supports exactly one: A lot consists of a single buy transaction
>>>> and sales are first-in, first-out. If that’s not what you want, you
>>>> have to handle all of it manually and ignore the View Lots dialog.
>>>>
>>>> Regards,
>>>> John Ralls
>>> Hi John
>>>
>>> Thanks for your swift reply. I think FIFO will work for me, but I am
>>> having trouble translating the "Concepts of Lots", the only
>>> documentation that I can locate, to the "View Lots..." screen
>>> functionality. For example, the screen menu button "Scrub" and what
>>> it does is not documented as far as I can determine.
>>>
>>> I was hoping for some kind of tutorial/pointers about how the screen
>>> functions translate to the "Concepts of Lots". Maybe there isn't any?
>>>
>>> Also, you mention a "manual" method not using the "View Lots..."
>>> screen. I cannot seem to find any other method, manual or otherwise,
>>> for "Lots" anywhere in gnc.
>>>
>>> _
>> Philip,
>>
>> The original subject of the thread you hijacked was “Chapter 8 -
>> Investment accounts”. Have you studied that chapter?
>>
>> Chapter 8 of the guide is really titled “Investments”, and the
>> English version can be read online at
>> http://www.gnucash.org/docs/v2.6/C/gnucash-guide/chapter_invest.html.
>>
>> Regards,
>> John Ralls
> Hi John
>
> Yes I have studied  Chapter 8 intently, particularly the 8.7 Selling
> Stock section. There is no mention of the "View Lots..." screen
> anywhere in that chapter.
>
> The 8.7 section discusses manually creating a stock sell splits, but
> There is no mention of how to specify a lot associating the sale with
> a buy.
>
> So I am assuming there is no documentation documenting how to use the
> "View Lots..." screen.
>
> After some painful experimentation I have come up with a somewhat poor
> recipe to record lots and capture capital gains. The pain/poorness
> comes from trying to translate the "proceeds", "cost basis" and
> "gain/loss" from my broker account reports into the "sell price" and
> "commission" in gnc, such that the capital gains gets recorded
> correctly. However, I do not feel that is a gnc problem.
>
> I'd like to thank "Mike" in a previous post for the clues to figure it
> out.
>
> Here is the recipe I am going to use going ahead.
>
> 1. record buy of stocks with care to get accurate cost of shares.
> 2. Actions > View Lots...: Select the added stock purchase record,
> press create lot.
> 3. record sell of same stocks. Do not follow Chapter 8.7 as it
> includes the gain/loss in the split. The split should only have the
> proceeds to the asset account, the commission, and the shares-price-sale.
> 4. Actions > View Lots...: Select the lot with the stocks just sold.
> The "Splits in Lot should show the selected purchase. The Splits Free
> should show the sale just created.
> 5. Select the sale in the Splits Free window.
> 6. Press the >> button to associate the Sale with the Buy.
> 7. Close the View Lots window.
> 8. An Orphaned Gain record should have bee automatically created with,
> hopefully, the correct gain or loss amount. Edit the record to direct
> the gain/loss to the appropriate short or long capital gain account.
>
>
>
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Phillip,

To re-iterate John's comment a few messages back,
"AS you probably know there are a variety of strategies for grouping
lots and for deciding which lot is the one you sold. GnuCash supports
exactly one: A lot consists of a single buy transaction and sales are
first-in, first-out. If that’s not what you want, you have to handle all
of it manually and ignore the View Lots dialog."

If you succeed in making Lots work for your needs, that is great. 

For many of us it is too restricting and we use other means to track
lots.  When John said "handle .. it manually", he was suggesting to do
it outside of GnuCash, perhaps with pencil and paper or more likely in
your own spreadsheet.  If you really do a lot of it, your broker may be
able to recommend a different computer program.

I personally generate lot identifiers loosely based on purchase(opening)
date which I include as part of the description in the purchase or sale
split lines of the transactions in GnuCash.  Then I still use my own
spreadsheet to track them and calculate the reportable capital gain/loss
because that also requires a different calculation method than GnuCash
does internally.

David C

PS  The developers always welcome help with updating the program code
and documentation.  If you want to volunteer ask them how you can help.