[GNC] Subject: Re: Keeping tenant accounts on Gnucash - periodic 'rent owing' ?

[davidcousens49 at gmail.com]

Arthur,

The option of using cash or accrual accounting is not necessarily totally a
choice on your part. It will likely depend upon the taxation legislation in your
jurisdiction. Many jurisdictions have a threshold on either turnover or income
below which the individual business has the option of either cash or accrual
accounting and above which you are obliged to use accrual accounting.  In
Australia the current threshold is an aggregated turnover of $10,000,000 but
your local jurisdiction may be very different. You should seek advice from a
local accountant.

In GnuCash, the Business Features assume and use accrual accounting principles.
You could circumvent that to some extent by creating and posting the
invoice/bill at the date  when you receive or make the payment.  The accounts
receivable/payable can be setup and operated manually if you do not or cannot
use the business features.

If you are not using the Business features then the major difference is in when
you recognize (i.e. the date at which you record the event in your books) income
or expenses. In accrual accounting this is when the income is deemed to be
earned or when the expense is incurred and may be different from the receipt or
payment of monies. In cash accounting it is simply when you make or receive the
payment.

If you have an existing spreadsheet system working, I would suggest running the
two in parallel for a while until you are confident that GnuCash is giving what
you want and need and you can duplicate the functionality. 

The main thing is to clearly identify what you need for your own tax purposes,
any business reporting required of you, reporting to the tenant and whether this
is a routine statement or ad hoc as required and what you need for your own
management purposes. This will help to define the required Chart of Accounts
structure.

Not sure what the "other" covers in your case but presumably this is the
provision of some sort of services to the tenant/property. You could deal with
this in GnuCash by having separate income sub-accounts for rent and any other
services you provide to the tenant. Using the description field for a
transaction and the memo fields for each split of the transaction appropriately
can allow you to use the various filter and search capabilities in GnuCash and
the reports/report options. 

David Cousens

On Mon, 2022-03-07 at 19:35 +0000, arthur brogard via gnucash-user wrote:
> Thanks for these inputs.  Hope I haven't done anything wrong.  I'm still
> blundering around trying to understand how to work the mailing list thing.
> It all looks too complicated to me.  Not worth the hassle. 
> 
> I'll tell you what I"ve got right now:
>   I have a spreadsheet that I enter money received,  date received,  payer
> into. It shows me then immediately which weeks rents have been pad and what
> the balance is at that rent day.
> If they've paid money for 'other', i.e. not rent money, I enter that amount
> into 'other' and only the rent amount into rent.
> The 'other' bit is not automated at all.  I have to eyeball it and calculate
> balance each time.  
> 
> So I enter their payment in there and see what balances I've got.
> Then I go to Word and pick up the last receipt I sent them and I modify it to
> suit this week's numbers.  And save it with the date of it.  Hence I've got a
> record of every receipt sent and I've got the spreadsheet.
> The receipts, I know, are not required by law because they pay by direct
> deposit.  But I prefer to do it that way.  
> 
> Now the pain is modifying that receipt.
> If I could have an account where I simply enter the receipt and it shows me
> the balance and I print that out as a receipt that'd be great.
> That account would have to have automatically incremented the 'amount due' as
> the real life dates passed. 
> 
> Well, two balances:  the rent and the 'other'.
> That's all I'm after.
> When I asked I really thought I'd get a reply saying that all such cases of
> meeting period payments, recording them, printing out statements of account
> and receipts are done by 'such and such' software or 'this and that' feature
> of gnucash.
> I realise (now) I'm making things abnormal in that my 'receipt' is really a
> receipt AND a statement, isn't it?  
> 
> A plain receipt would be easy as pie.  
> 
> No.  I need more than that.  Everything has to be crystal clear to this
> tenant. What he's paid for rent, what for other, what the balances are when
> the next payment is due,  which weeks have been paid for.
> What I will do is start using gnucash with my present state of knowledge and
> just find out what happens.  See how I go.
> I'll use cash accounting I guess.  See no need for accrual as best I hazily
> remember my accounting. (It was over 20 years ago).  
> 
> Do we have to tell gnucash which we're using or its all in how we enter
> things?
> Thanks for all the interest and help.
> 
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