[GNC] accrual of property tax payments

[Adrien Monteleone]

> On Feb 12, 2019, at 11:47 AM, Keith Bellairs <keith at bellairs.org> wrote:
> 
> Thanks, Derek. The issue has been around for years, I guess.
> 
> Looking at invoices, for a cash basis user the invoice should get posted to
> payables when received and the payable is reversed to expense on the date
> the payment is actually made.

The question here is posted to ‘payables’ and ‘what else?’

Every transaction must have (at least) two splits.

In the paper world, a cash-basis entity would not even enter any transaction for a received bill until it is paid.(their ‘payables’ would be kept separate from the actual books)

What would need to happen in GnuCash is the option to mark a bill as ‘cash basis’ when entering it. This would set the posting date as the date it is paid, but still allow the ‘due reminder’ to fire, and GC would have to maintain a separate list of ‘due bills’ from A/P since it technically can’t be entered there. (unless some one finagles some sort of virtual account for the purpose)
> 
> For an accrual basis user the expense could be posted immediately to the
> (past, present, or future) "due date". If it's in the future it won't show
> up in current P&L, which is correct.


Accrued means it is already incurred, so it wouldn’t necessarily (if ever) be posted to the due date. It should be posted likely on receipt or an even earlier date if applicable, that is, in the period the expense was incurred.


> I found that I could not edit the
> dates on the expense transactions that were created by the business logic,
> so all 4 quarters show up as expenses on the day I posted the invoice. That
> doesn't seem right in anyone's world.
> 

You can’t edit the expense transactions if you posted the bill to expense in the line items. They are part of the bill and that is the only place you can edit it. This is for safety. You could make a mess if you were able to edit portions of a bill, outside of the bill itself.

If you really need to edit a bill that is posted, you have to first un-post it. But beware that even though you can put dates on line items, those do not affect posting or transaction dates. The entire bill gets a single posting date of your choosing. Those line item dates are merely reference for you or your customer. (if speaking of invoices)

Again, having all four quarters show up in one year being ‘right’ depends on your situation. If this is merely a ‘payment plan’ then it is correct. The entire bill is owed now, and thus is an expense in its entirety, now, but they allow you to pay it over 4 quarters. If you were to sell the property mid-way, who does the town legally think owes the taxes? But by all means, speak to a local CPA to get a definitive answer on how to book this.