[GNC] help to set up equity sub-accounts opening balances

Adrien Monteleone adrien.monteleone at lusfiber.net
Sun Aug 9 13:29:41 EDT 2020


Don,

What I presented was a way to track something that GnuCash isn't set up 
for. There have been prior posts discussing systems like Envelope Method 
budgeting and segregating/earmarking funds. These would be cases where 
the real-world accounts need to be kept unchanged, but the user wants to 
track how they've earmarked funds in those accounts.

Certainly, outside budgeting software or a spreadsheet can do the job. 
When budgeting or deciding on saving, you're already looking at your 
books and reports to make those decisions, so it does make sense to want 
to handle that activity in the same place.

While it was given as one of the options, I'm not a fan of abusing 
Equity accounts either.


Regards,
Adrien

On 8/8/20 12:11 AM, doncram wrote:
> Yikes, i think Adrien should not write that up on the wiki!  This has
> gotten crazy.  No one should have to go through complicated gyrations so
> that equity subaccounts can awkwardly report amounts that are unusual and
> aren't very meaningful.  This gets impossible to follow, so I am not sure,
> but I think the amounts that could appear in those accounts would have to
> be created based on off-line calculations, say in a spreadsheet....why not
> just use the spreadsheet, no value is added and possibly mistakes are
> introduced in whatever you are doing trying to make equity accounts report
> something.
> 
> The only basic application I understand in all of this is about tithing,
> where one wants to track amounts of tithing obligations incurred vs.
> amounts of tithing paid.  Which is handled extremely simply by considering
> the total amount of unpaid tithing obligation as a liability, "Tithing
> Payable", and by considering the incurrence of new tithing obligations as
> expenses.  Then payments of cash to reduce the tithing payable are just
> that.  Whenever you receive salary or otherwise trigger a tithing
> obligation, simply recognize the corresponding tithing expense.  You
> receive $5,000 salary, for which $500 tithing is due:  enter as Tithing
> expense +500, Tithing payable +500.   The tithe might actually be paid to a
> church only once a year, at the end of the year, say?  Then the Tithing
> payable will gradually increase, say it has accumulated to $8,000 when you
> choose to pay it all off from your checking account:  enter as Tithing
> payable -8,000, Checking -8,000.  At every point in time, a Balance Sheet
> report would show your accumulated unpaid obligation.  For any period of
> time, an Income Statement will show your salary earnings and whatever else,
> and the corresponding Tithing Expense (which is the increase in tithing
> obligation recognized during the period.
> 
> I regret seeming to approve, in a previous post, of any use of an equity
> subaccount to report something different than what equity is (sum of all
> original investments by owner(s) to the business, plus accumulated net
> income since then, less dividends or other returns of equity to owners).  I
> thought maybe if you have a fixed emergency savings threshold you wanted to
> reflect, that it would be okay to do that, so equity is divided between
> that and all other, but that doesn't accomplish anything useful, you
> already knew what your emergency amount is. This other stuff is crazy, and
> is fighting against what the accounting system can do for you, rather than
> letting the accounting system help you (keep track of what you owe vs. what
> you have paid, in tithing).  Or could anyone explain any sensible purpose
> to this?
> 
> Don



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