Report wrong after stock class conversion

Randyrama

I have customized a investment account balance report that gives account balances for the trailing 12 months by week. My company's 401K provider recently changed stock classes on two funds, Dodge and Cox Stock Fund (from class I to class X) and Harbor Capital Appreciation (to class CIT5 or something like that). On the conversion date I recorded sales transactions for the old class and purchase transactions for the new classes....it was multiple transactions since they are in different 'buckets', but I don't think that matters. Anyway, now Quicken seems to think I have a gain for the week of the conversion in the amount of the purchases. I tried going in and adding a quote for the day prior to the conversion for the same amount as conversion date, but that didn't seem to help. Any ideas on how to handle this? It really throws off the graphs that I have the spreadsheet I paste the info into....any thoughts would be appreciated.

Tom Young

"On the conversion date I recorded sales transactions for the old class and purchase transactions for the new classes..."

A "sale" transaction isn't the appropriate way to record these sorts of tax-free conversions from one share class to another share class.  The "Mutual Fund Conversion" action was designed for this exact situation.  One problem though is that the Mutual Fund Conversion action seems to have a bug in it if you've been accounting for a fund using average cost.  To get around this, if you have been using average cost, change the costing method for the fund to something else before using this action. 

So I'd suggest deleting those Sells and Buys, change the costing method for any funds where you've used average cost, making a backup of your data file, and then using the Mutual Fund Conversion action.

(You could avoid having to change the cost basis method if you use the "Corporate acquisition (stock for stock) action, but that action works across your entire file if you hold those same funds in more than the one account.)

Randyrama

Thank you for your reply!
> @Tom Young said:
The "Mutual Fund Conversion" action was designed for this exact situation.  One problem though is that the Mutual Fund Conversion action seems to have a bug in it if you've been accounting for a fund using average cost.  To get around this, if you have been using average cost, change the costing method for the fund to something else before using this action. 
I can't seem to find a transaction type for Mutual Fund Conversion. I am on Quicken Premiere R42.8. Can you point me in the right direction?
> So I'd suggest deleting those Sells and Buys, change the costing method for any funds where you've used average cost, making a backup of your data file, and then using the Mutual Fund Conversion action.(You could avoid having to change the cost basis method if you use the "Corporate acquisition (stock for stock) action, but that action works across your entire file if you hold those same funds in more than the one account.)
I don't really see this, either. I did have a stock spinoff a little while back and used the Stock Dividend action in the register transaction.....is that the right method?

I really appreciate the feedback...thank you!

Tom Young

Not all the "actions" available in an Investment Account Transaction List (called a "Register" in Spending Accounts) are available under the Actions column of a Transaction List.  To get the full presentment of actions you need to click on the "Enter Transactions" button in the upper left hand corner.  That's where you'll see the Mutual Fund Conversion action, as well as the Corporate Securities Spin-off action.

In a true spin-off situation your original basis in the "parent" stock is allocated between the new "child" stock and the parent.  The Corporate Securities Spin-off is designed for that situation.

q_lurker

Randyrama said:

I have customized a investment account balance report that gives account balances for the trailing 12 months by week. 

(after selling and buying shares)

Anyway, now Quicken seems to think I have a gain for the week of the conversion in the amount of the purchases.  …  Any ideas on how to handle this? It really throws off the graphs that I have the spreadsheet I paste the info into....any thoughts would be appreciated.

Investment account balance reports I am familiar with do not show gain/loss. Is that something you are computing separately?

You did not indicate how you did the sell buy pair. At basis? At current market value?  It could make a difference. 

The Remove / Add Shares of the MF Conversion or the Corp Acquisition actions should be preferable (perhaps with some tweaks) but still might not suffice in your customized report. More detail on that would be needed to comment. 

Randyrama

> @q_lurker said:
> Investment account balance reports I am familiar with do not show gain/loss. Is that something you are computing separately?
That is an excellent point. You are correct, I am calculating two numbers for my charts...a comparison of each week to week 1, and a comparison to the previous week. So it is the balance that is overstated for the week of the transactions and that throws off the result of my simple formula.

>
> You did not indicate how you did the sell buy pair. At basis? At current market value?  It could make a difference. 
I just did the sale at market price for that day and the buy for the other class of the fund at that fund's market price. I am not too concerned about basis since this is all pre-tax 401(k).
> The Remove / Add Shares of the MF Conversion or the Corp Acquisition actions should be preferable (perhaps with some tweaks) but still might not suffice in your customized report. More detail on that would be needed to comment. 
Understood. The gentleman that answered above gave me some more information on these functions and I am going to go back and look at them. Considering how long I have been a user I am a little embarrassed to find out that not all functions are available in the transaction register. Live and learn!

Thank you very much for your teply!