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Distributions and taxable components Expand / Collapse
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Posted 26/05/2007 8:31:45 PM
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The current situation with the entry of distributions is very difficult. You have to make a choice either to not enter distributions during the course of the year or to go through a messy and difficult process in order to enter the taxable components information at the end of year.

The entry of distributions for the purpose of keeping track of investments/portfolio value/asset diversification etc should be separated from the entering of the information re. tax components of a distribution.

I would like to be able to enter the distributions during the course of the year and then perform some fairly simple and robust process (errors etc) at end of year to specify the tax components of eith each individual distribution or preferrably the set of distributions related to a single asset.

Thanks
Bryan Lovquist
Post #3178
Posted 7/06/2007 9:45:21 PM


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Brian

We are getting a number of requests around distributions. We will look at changes in a future release

If anyone has any suggestions around Distributions please post

Regards

MySF
Post #3179
Posted 7/06/2007 9:45:21 PM
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I was thinking.

If I could enter the distributions lets say as a distribution reinvestment MYSF would generate a transaction to create and debit the asset and a transaction to credit a distribution suspense account (possibly created for that asset or possibly a shared one).

I would do this for each distribution recieved. This would allow me to record the purchase os assets in a timely manner.

You would add a new function to MYSF (similiar to the existing one) which would allow me to identify (at EOY) all of the tax components of the total distribution for each asset. MYSF would then generate a journal to remove the funds from the suspense account and distribute as required.

Regards
Bryan Lovquist
Post #3180
Posted 7/06/2007 9:45:21 PM
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This financial year I find myself in a situation where the distribution from a managed fund did not occur until July 18 but After speaking to the fund manager it seems that I must accru the tax liabilitiy in this financial year.

As it is I have had to create a bank account called 'Distributions on deposit' and performed a distrinbution transaction into this. It also causes problems with determining the value of the asset given that I have accrued the distribution and have to determine an effective unit price for the asset so that everything comes out properly.

In the next financial year I will have to do an asset purchase funded from the new bank account and update the unit price.

If you could have some functionality to handle this situation it would be good.

Thanks
Bryan Lovquist
Post #3181
Posted 7/06/2007 9:45:21 PM
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If you are going to do some work on distributions anyway.

Another thing that I would like changed would be that I can choose the asset code for which I am doing a distribution/reinvestment and then all of the attributes of the new asset would be defaulted from the other first asset associated with that code.

This would include such things as code, short name, long name, distribution accross asset categories etc.

I would also like to be able to set the distribution accross asset categories at the asset code level rather than the individual asset level.

Could you also use more of the screen area. I have a 20" monitor but your application uses only a fraction of the available screen area. I am constantly scrolling in order to see the information that I need to see. At least allow me to resize the windows.

Regards
Bryan Lovquist
Post #3182
Posted 7/06/2007 9:45:21 PM


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We currently have functionality that allows you to define a default asset allocation for an asset class. To see how this works, select an asset class from System Setup > Asset Classes and click on Edit Default Allocations in the bottom left hand side of the screen. This allows you to define a default allocation so that you do not need to type 100% for Shares every time you add one, but you can change it at the asset level if needed.

We will do a major update that includes a revision of the user interface, but this is still some time away.

Regards,

MySF
Post #3183
Posted 7/06/2007 9:45:21 PM
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I agree an easier process would be helpful.

The difficulty is how accurate you want tax estimates to be during the year. If you want them fairly close, you need to enter the tax components during the year, expecially if you are contemplating selling the trust units.

Perhaps there could be a special 'amend franking' or 'amend distribution' screen. This could present the current amounts entered and have a new box next to each current amount for the entry of the new components, including the usual checking mechanisms to make sure they balance.

Behind the scenes, the MYSF program could 'seamlessly' do the appropriate reversals and new postings to amend the amounts.

If I can offer some gratuitous advice: The more I see the issues users have, the more I believe that a little more user friendliness in how MYSF presents data entry screens, requests for information and especially facilitating amendments (e.g. the two step asset removal process) will go along way towards helping.

As I've said befoire, this would not only help users but also ease your support load. Of course I don't know how much aditional programming would be required to convert simpler screens into the right entries; but it may be worth it overall.
Post #3184
Posted 7/06/2007 9:45:21 PM
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The default asset allocation per asset class does not solve the problem. For instance I have investments in managed funds (the asset class). Some of the managed funds invest primarily in Australian securities, others in international securities and others in infrastructure securities. Having a default asset allocation is of no use.

Also when you do a distribution/reinvestment the newly created asset should inherit its properties form the asset which created the distribution. I am constantly having to fix up minor typo errors that I do when processing a distribution.

I don't believe that there is any situation under which assets having the same asset code would have differing asset allocations. The asset allocation should be at the asset code level not the asset level.

I have come to appreciate while doing the EOY entries this year how painful the current distribution recording mechanism is. In order to get things correct and still have the functionality of recording distributions as they occur throughout the year (which I did) I am havinf to manually do the calculations and create journals for every distribution to get the tax components correct. What should be taking me an evening has now stretched on to 2 weeks!!!

Distribution processing needs to be fixed!!!

Regards
Bryan Lovquist
Post #3185
Posted 7/06/2007 9:45:21 PM


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Brian

If you would like us to keep answering your questions and taking on board your ideas we are happy to do so. I have already agreed to look at improving the process

Should it take 2 weeks to process distribution transactions - No

Is the distribution process broken - No

Can it be improved - Yes absolutely and we will look at it.

Regards

MySF
Post #3186
Posted 7/06/2007 9:45:21 PM
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I have posted queries before about how to handle propery trust distributions as well as the end of year data in annual tax statements. None of the responses has been satisfactory to me, although I am very appreciative of all the attempts to help me solve my problems.

What I would like to see is the processing of distributions to reflect what actually happens for me, i.e., two or four distribution receipts during the year, each of which is a sum of money only, with no information re the various components; then, at the end of the year, an annual statement which contains all the details of components, but on an annual basis and not identified with each of the two or four distributions during the year. Thus, a simple process of entering the distribution sums as they are received, and then, at the end of the year, a further process to automate whatever adjustments need to be made to deal accurately with the annual components disclosed in the annual statements.

Maybe I am expecting too much, but unless this can be sorted out, my accountant will be repeating his recent advice to me, namely that using MySF is of questionable value when he has to spend so much time at the end of the year sorting out the figures to prepare an accurate tax return.
Post #3187
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