[GNC] GNC Equity and Retained Earnings not tracking together?

[Brian]

Christopher, my error.  If you re-read the original post the transaction
was posted Assets:Cash and Equity:Shareholder Distribution.  Liability
was not in the equation.  Basically, your comments confirm that the
GNUCash automatic calculation is rudimentary and to get a true
"retained earnings" that one must "close" books, or consider the
Balance Sheet report with a correction needed for the "Retained
Earnings" line is involved.

My previous statement should have read
> > Christopher, then I believe you are saying to get a proper "retained
> > earnings", which recognizes the reduction of Assets:Cash and
> > increase to EQUITY:Shareholder distribution, that one
> > would need to properly close the books by moving income and expense to a
> > EQUITY:Retained Earnings sub-account?

While that is disappointing, I can properly calculated true
"retained earnings" from the Balance Sheet report and simply need to add
the steps of "saving" a "open" version prior to closing the books, then
closing income and expense to "EQUITY:Retained earnings" and "saving"
that gnucash version with a tag of "closed" in the file name.  Then
there will be available a non-close version to go back and make
corrections if errors are found in the future.  Extra steps but
workable.  Thanks for the help. 
------------------------------------------------------------------------------------------------------------------
On Tue, 10 Mar 2020 16:33:12 +0000
Christopher Lam <christopher.lck at gmail.com> wrote:

> The right answer will be to submit the Transaction Report to the
> accountant, have him/her calculate the Retained Earnings and
> Shareholder Distribution for you, then you pay your shareholders via
> Assets:Bank/Cash -> Liability:Shareholder (and later
> Liability:Shareholder -> Expenses:Shareholder Dividends I guess?)
> 
> I also think you'd close the books to an Equity:Retained Earnings
> account rather than Liability:Retained Earnings. I think untold
> surprises will arise if closing books to Liability.
> 
> IMHO Balance Sheet's Retained Earnings seems designed to be Net Income
> https://en.wikipedia.org/wiki/Net_income
> 
> That's all I know.
> 
> On Tue, 10 Mar 2020 at 15:29, Brian via gnucash-user <
> gnucash-user at gnucash.org> wrote:
> 
> > > On Tue, 10 Mar 2020 at 01:02, Brian via gnucash-user <
> > > gnucash-user at gnucash.org> wrote:
> > >  
> > > > I'm wondering if GNUCash is actually calculating RETAINED
> > > > EARNINGS properly.  Because after issuing a distribution to
> > > > shareholder the Retaining Earning calculation increased by Net
> > > > Income but did not decrease by Asset:Cash which was debited and
> > > > credited to Equity:Shareholder Distribution.
> > > >  
> > >
> > > The calculation of Retained Earnings and Unrealized Gains in the
> > > Balance Sheet is rather primitive, and has been as such since
> > > nearly forever.
> > >
> > > Retained Earnings = sum total of income less expenses at the
> > > balance-sheet date.
> > > Unrealized Gains = sum total of (asset-liability) value, minus sum
> > > total of (asset-liability) cost.  
> >
> > Christopher, then I believe you are saying to get a proper "retained
> > earnings", which recognizes the reduction of Assets:Cash and
> > increase to Liability:Shareholder distribution, that one would need
> > to properly close the books by moving income and expense to a
> > Liability:Retained Earnings sub-account?
> >
> >
> >
> >
> >
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