[GNC] Tracking capital gains, commissions and the Trial Balance report

[Daniel Torstenson]

Hi,

I've been looking into tracking my capital gains and commissions for a
brokerage account, and I'm running into an issue that I see others have run
into. Namely, I'd like to account for my commissions and also keep track of
my capital gains, as my brokerage reports them (and as the IRS expects
them).

 I found a few threads on this topic, but didn't really see a good
resolution.

https://lists.gnucash.org/pipermail/gnucash-user/2016-April/065058.html
https://lists.gnucash.org/pipermail/gnucash-user/2017-February/069173.html
https://bugs.gnucash.org/show_bug.cgi?id=778455#c4

The problem, as has been pointed out, is that in a double-entry accounting
system, you can only account for expenses once. Either you count
commissions as an expense, or you count them as a lowered capital gain. If
you do both, you're double counting and your book is out of balance.

You can force GnuCash to do it by tweaking the following the instructions
for manual calculation of capital gains

https://lists.gnucash.org/docs/C/gnucash-guide/invest-sell1.html#invest-sell-man

You simply enter the "net profit" instead of the "gross profit" for the
capital gains in that example. I gather some people do that, but it's
wrong, and when you run a Trial Balance report, you'll see the credits
don't equal the debits.

In the bug report above, John Ralls suggests a solution that I didn't
completely understand. I have a method that's inspired by that comment that
seems to work for me, but I'm not an accountant and I'm wondering what the
"standard" method is. In other words, what do the accountants at, say
Berkshire Hathaway or any other firm with a trading desk do?

I attached a snapshot of the transactions for a fictitious XYZ stock. I
simply break up the "Capital Gains" into two subaccounts: "Capital
Gains:Net Capital Gains" and "Capital Gains:Commissions". When I do this,
the Trial Balance report checks out as desired.

But it seems a little funny to me to have both a commissions expense
account and a commissions income account (Capital Gains:Commissions), so
I'm wondering if there's a more standard way of doing this.

Thanks!
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