[GNC] Switching to trading accounts in existing database

Fri Jan 22 00:13:08 EST 2021

When I implemented trading accounts several years ago they were a bit 
controversial.  Some people thought they were more trouble than they 
were worth and argued that they should be an opt-in choice.  One of the 
initial design goals was that if you didn't turn them on nothing would 
change in the way GnuCash behaved.  The initial implementation had some 
rough edges too, which didn't help.  It's been a while since any 
significant problems have come up with them (although a new bug was 
filed on them today) so maybe this question should be revisited.

It's also the case that the user interface leaves a bit to be desired.  
It is harder than it should be to enter multi-currency transactions with 
trading accounts turned on.  At the time I implemented them there was an 
effort underway to rewrite the code that supports the register UI and 
the new implementation would have improved this.  Unfortunately that 
effort was later abandoned and we're left with the old UI code.  I have 
ideas for how to improve it, but my time and ability to do much coding 
is limited these days so I probably won't get to it soon.  See 
https://bugs.gnucash.org/show_bug.cgi?id=797913 for more information 
about this.

I know what you mean about multiple currencies.  I haven't moved around 
as often as you have, but I've lived in a couple of countries and spend 
a lot of time traveling in various others.  I think I have accounts in 
nearly 30 currencies over a 30 year period.  I used to have income and 
expense accounts in multiple currencies, but this turned out to not work 
well so I now use only one currency for all of them and convert 
transactions in other currencies into USD.  This works for me since it 
is still my home currency although I am under increasing pressure to 
move to Canada.

Mike

On 21 Jan 2021, at 21:06, Lukas Haase wrote:

> Hi Christopher,
>
> This is very sad. Sad for various reasons.
>
> I went over these documents previously (but did not read them 
> thoroughly).
>
> My takeaway is:
> * Storing the conversion rate per transaction makes the accounting 
> equation as a function of time inconsistent (but it is consistent for 
> each snaphot in time).
> * Trading account accounts for these inaccuracies.
>
> My question was more why the trading accounts (which seem to me the 
> cleaner, superior and better way) are not enabled by default.
>
> Also, can you comment a bit more why precicely this would be a major 
> minefield? (If you know it, of course).
>
> Multiple databases are just extremely hard for some people (like me).
>
> Consider living for a couple of months to a year in a different place. 
> There is just no way to separate this in a clean way without 
> replicating all the transactions in different databases. BTDT.
>
> Also I moved multiple times. Even then, there is no clear cut: 
> Initially I would use credit cards, ATM etc. from previous country. 
> Even the first or second rent may be partially paid with funds from 
> the previous location. It takes a few months until I could consider 
> the books between two countries sufficiently separate. The only ways 
> are a) Massive transaction Replication b) booking everything I pay 
> with funds from old country into old database. But with my rent 
> example, it gets very inconsistent how much I paid rent at the new 
> place.
>
> Lastly, simple portfolio accounting (e.g. crypto currencies) if they 
> are bought in different countries.
>
> I am curious what the potential mines are so I can try to avoid them.
>
> Lukas
>
>
>
> On 2021-01-21 20:20, Christopher Lam wrote:
>> Multicurrency is a major minefield.
>> Start from 
>> https://www.mathstat.dal.ca/~selinger/accounting/tutorial.html
>> and finish with
>> https://www.mathstat.dal.ca/~selinger/accounting/gnucash.html for the
>> background on trading accounts.
>>  From discussion with accountant, it would seem that the safest 
>> approach is
>> to have 1 book per home currency. When you move countries you'd be 
>> better
>> off with a new book with a new home currency. Taking temporary trips 
>> abroad
>> gets the currencies translated to home currency. AFAIU. IANAA YMMV.
>> https://techcrunch.com/2010/08/14/internet-must-be-true/
>>
>> On Fri, 22 Jan 2021 at 00:59, Lukas Haase <lukashaase at gmx.at> wrote:
>>
>>> Hi Mike,
>>>
>>> On 2021-01-21 02:24, Mike Alexander wrote:
>>>> On 19 Jan 2021, at 20:08, Lukas Haase wrote:
>>>>
>>>>> So I got recommended using trading accounts. But suddenly all my
>>>>> previous multi-currency transactions get a small grey box with a 
>>>>> cross
>>>>> (hinting the transaction is inconsistent).
>>>>>
>>>>> How do I best deal with this?
>>>>> Is it possible to keep my old multi currency transactions as-is 
>>>>> and
>>>>> use trading accounts only for securities/stocks?
>>>>>
>>>>> If not, how do I migrate while ensuring my ten years worth of data
>>>>> does not suddenly get inconsistent?
>>>>
>>>> You should be able to use the "Check & Repair" commands in the 
>>>> Actions
>>>> menu to add the trading account splits to existing transactions.  I
>>>> would certainly save a copy of my data before doing this, and try 
>>>> it on
>>>> a few transactions first.  Your situation is complex enough that it 
>>>> is
>>>> not unlikely that this won't do exactly what you want, but it's 
>>>> worth a
>>>> try assuming you have good backup.
>>>
>>> Thank you, I think that worked indeed.
>>>
>>> I still need to cross-check everything (at the first glance things 
>>> look
>>> OK).
>>>
>>> So then I'd have a general question on the multi currency feature:
>>>
>>> 1.) Are "Trading Accounts" just an *alternative* way to handle multi
>>> currencies (and as such have nothing to do with "trading")?
>>>
>>> 2.) Trading Account seem to be way more powerful than storing the
>>> exchange rate in each transaction
>>>
>>> 3.) Why exactly aren't they enabled by default if they are so 
>>> superior?
>>> Why let people my default use the way that makes things less 
>>> consistent
>>> and error-prone?
>>>
>>> Thanks,
>>> Lukas
>>>
>>>
>>>
>>>
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