[GNC] Trial Balance Issue with Fund Merger

[Lisa Rowell]

I'm working my way through my account history after a massive GnuCash 
import, straightening out issues with missing realized capital 
gains/losses and came across an event that I can't figure out how to 
properly handle.

I held shares of a fund called Spartan 500 Index Investor Class (FSMKX) 
which merged with Spartan US Equity Index Investor Class (FUSEX) at some 
odd rate around 1:0.513. When I did the import, I ended up with an 
account for FSMKX and an account for FUSEX and a manually entered 
exchange transaction which did a sell of FSMKX shares and a buy of FUSEX 
shares with no share price. This got everything balanced out as far as 
share counts go, but now I'm finding it's showing up as being not 
correct in the Trial Balance. It looks to me like the exchange is being 
interpreted as if an actual sell event had taken place.

Can GnuCash properly account for this? The case in the manual's More 
Complex Merger example is a bit different because the example stock 
continued to trade under the same symbol, so that solution doesn't map 
well. I found a past mailing list thread that said that the proper way 
to account for this is as a sell transaction of the going away fund and 
a buy transaction of the fund that lives on with an accompanying 
Realized Gain transaction. This doesn't seem right to me though since I 
didn't sell the shares and did not realize a gain and I don't even have 
prices for the time of the merger. In my way of looking at it, the gain 
calculation should come at the time of sale and be based on purchase 
price of the various share amounts, and not at the time of the merger, 
since that maps to the tax view of things where I live.

I understand that GnuCash wouldn't be able to calculate the realized 
gains post merger, and I'm ok with doing that in a  side spreadsheet, 
but am more looking for a way around the bogus realized gain entry at 
the time of merger just to make the Trial Balance happy.

Thanks.

Lisa R.