Owner's Draw setup under Equity group

[Adrien Monteleone]

Brian,

Indeed Owner’s Draw is generally a temporary account, when dealing with paper. Temporary accounts are a ‘feature’ of paper books that derives from the need to ‘close the books’ due to the limitations of amount of paper in bound volumes and manual filing systems. Some people confound book closing with accounting controls, but this is generally not the usual case. With the advent of computerized accounting software, you have the option to close or not close ‘the books’ each accounting period. (annually, quarterly, monthly, etc.)

If you do not close, each account remains a running total, however any individual report you run is for a specified time period and so has the flexibility to reflect only the data you want. (for a year, quarter, month, etc.)

There are other threads and topics on the advantages and disadvantages to closing the books vs. not doing so, the primary disadvantage being that you end up with separate files for each closing, which means you can’t run historical reports easily, and can’t run reports for combined periods without export to a spreadsheet or other software.

Can you provide example transactions or balances which illustrate why you don’t think things are working as intended?

-Adrien


> On Mar 11, 2017, at 8:54 PM, gnucash-user-request at gnucash.org wrote:
> 
> From: Brian Hagen <bdhagen at fastmail.com <mailto:bdhagen at fastmail.com>>
> Subject: Owner's Draw setup under Equity group
> Date: March 11, 2017 at 2:25:22 PM CST
> To: GNUCASH <gnucash-user at gnucash.org <mailto:gnucash-user at gnucash.org>>
> 
> 
> Hello, all:
> 
>    I am using GNUCASH 2.6.14 under Linux Mint. I want
> to add an account to the parent group "Equity".
> I want to call it "Owner's Draw", but if need be I
> will name it something else. What I want is a way to
> register the funds withdrawn from Cash for personal
> use, and have the transaction debit correctly from both
> Cash and Equity accordingly. From what I have read for
> standard accounting practices, this is the way professional
> bookkeepers do these changes.
> 
>    According to what I have read, this should be a "temporary
> account" in the sense that is to be closed out completely
> at the end of a fiscal term, usually one year.
> 
>    So far, I have created an account as I just
> described. However, I am not certain that it
> is working as intended.
> 
> Any suggestions are certainly welcome.
> 
> Brian