GnuCash › GnuCash - User

Company sponsored stock plan

Classic

List

Threaded

7 messages Options

wp.rauchholz

Company sponsored stock plan

Trying to set the following up, but can‘t get it right. I hope to find help
here. That is the scheme:
The base currency is in €.

1) monthly, a certain amount (in €) is taken off salary and invested in
stocks (in USD)
2) the company adds X-% on top of the amount and stock (in USD) is bought
3) Reporting is done in base currency €.

Once this is done, I need to add quarterly dividends, but I believe I saw
something in the manual.

Thx for your help.
--

Wolfgang Rauchholz
_______________________________________________
gnucash-user mailing list
[hidden email]
https://lists.gnucash.org/mailman/listinfo/gnucash-user
-----
Please remember to CC this list on all your replies.
You can do this by using Reply-To-List or Reply-All.

Ignacio Fernandez Ortega

Re: Company sponsored stock plan

If you are using the multicurrency example from the guide I am sure is not
going to work
I dealt with the same issue last week. Take a look at
https://lists.gnucash.org/pipermail/gnucash-user/2017-December/073686.html

On Thu, Dec 28, 2017 at 4:27 PM, Wolfgang Paul Rauchholz <
[hidden email]> wrote:

> Trying to set the following up, but can‘t get it right. I hope to find help
> here. That is the scheme:
> The base currency is in €.
>
> 1) monthly, a certain amount (in €) is taken off salary and invested in
> stocks (in USD)
> 2) the company adds X-% on top of the amount and stock (in USD) is bought
> 3) Reporting is done in base currency €.
>
> Once this is done, I need to add quarterly dividends, but I believe I saw
> something in the manual.
>
> Thx for your help.
> --
>
> Wolfgang Rauchholz
> _______________________________________________
> gnucash-user mailing list
> [hidden email]
> https://lists.gnucash.org/mailman/listinfo/gnucash-user
> -----
> Please remember to CC this list on all your replies.
> You can do this by using Reply-To-List or Reply-All.

_______________________________________________
gnucash-user mailing list
[hidden email]
https://lists.gnucash.org/mailman/listinfo/gnucash-user
-----
Please remember to CC this list on all your replies.
You can do this by using Reply-To-List or Reply-All.

David Carlson-4

Re: Company sponsored stock plan

It sounds like your company is setting up an account similar to what we
usually call a 401-K in the US.

Whether it actually is a 401-K or not, you can track the account in the
same way, except for the tax related issues.

You can set up GnuCash to have a brokerage account similar to the example
in the Tutorial with Security accounts as child accounts taking care to
fund them with the correct currency. As Ignacio mentioned, it may not be
tracked correctly in the advanced portfolio report unless you modify the
example as documented in other discussions here about the Advanced
portfolio report..

Since your base currency is Euros, you will also need to take care which
transactions are in which currency and which ones handle conversions from
USD to Euros.

Good Luck

David C

On Thu, Dec 28, 2017 at 4:33 PM, Ignacio Fernandez Ortega <[hidden email]
> wrote:

> If you are using the multicurrency example from the guide I am sure is not
> going to work
> I dealt with the same issue last week. Take a look at
> https://lists.gnucash.org/pipermail/gnucash-user/2017-December/073686.html
>
>
> On Thu, Dec 28, 2017 at 4:27 PM, Wolfgang Paul Rauchholz <
> [hidden email]> wrote:
>
> > Trying to set the following up, but can‘t get it right. I hope to find
> help
> > here. That is the scheme:
> > The base currency is in €.
> >
> > 1) monthly, a certain amount (in €) is taken off salary and invested in
> > stocks (in USD)
> > 2) the company adds X-% on top of the amount and stock (in USD) is bought
> > 3) Reporting is done in base currency €.
> >
> > Once this is done, I need to add quarterly dividends, but I believe I
> saw
> > something in the manual.
> >
> > Thx for your help.
> > --
> >
> > Wolfgang Rauchholz
> > _______________________________________________
> > gnucash-user mailing list
> > [hidden email]
> > https://lists.gnucash.org/mailman/listinfo/gnucash-user
> > -----
> > Please remember to CC this list on all your replies.
> > You can do this by using Reply-To-List or Reply-All.
> _______________________________________________
> gnucash-user mailing list
> [hidden email]
> https://lists.gnucash.org/mailman/listinfo/gnucash-user
> -----
> Please remember to CC this list on all your replies.
> You can do this by using Reply-To-List or Reply-All.
>

Klaus Dahlke-2

Re: Company sponsored stock plan

In reply to this post by wp.rauchholz

Hi Wolfgang,
I have modeled a comparable plan as follows: first of all, I record my salary only net. Salary is what is posted to my bank account after all deductions.

I you don't participate in such plan, posting is straight forward, e.g.:
Bank <-> Income:salary -> 1000

If you participate in the plan, a further account is helpful to show the plan contribution. Also, the amount transferred from your company to your bank is reduced by your own contribution and the taxation for companies' addition. Assuming you participate with 10% of your monthly gross (e.g.150) and your employer will add 20% of our contribution (30 in this example) which is then taxed at 50% (incl all statutory taxes) the postings will be then:

Bank <-> Income:salary -> 835 (1000 - 150 -15) (typically retrieved via aqbanking/HBCI)
PlanContribution <-> Income:salary -> 180 (manual posting)

When the shares are bought, this transaction is typically independent of currency because only the number of shares count:

PlanContribution <-> Investments:MyCompanyStock -> -180 (or whatever the amount is if no fractions can be bought, manual posting).

On the Investment:MyCompanyStock account you set the transaction to the correct number of shares bought (manual posting).

I do assume that you will not have a separate bank account transactions in USD. The dividend payment will be then calculated by your bank and posted in Euro to your bank account:

Bank <-> Income:interest -> 0.10 (this is the Euro equivalent of the 0.12 USD dividend (HBCI retrieval )

You need the USD<-> EUR exchange rate for the correct valuation of the Investments:MyCompanyStock account which you track probably in USD.

BR,
Klaus

On Thu, 28 Dec 2017 21:27:19 +0000
Wolfgang Paul Rauchholz <[hidden email]> wrote:

Mike or Penny Novack-3

Re: Company sponsored stock plan

On 12/30/2017 4:39 PM, Klaus Dahlke wrote:
> Hi Wolfgang,
> I have modeled a comparable plan as follows: first of all, I record my salary only net. Salary is what is posted to my bank account after all deductions.
>
> I you don't participate in such plan, posting is straight forward, e.g.:
> Bank <-> Income:salary -> 1000
>
> If you participate in the plan, a further account is helpful to show the plan contribution. Also, the amount transferred from your company to your bank is reduced by your own contribution and the taxation for companies' addition.
Stop --- this advice depends on jurisdiction (in the US, the
contributions if "pretax" are taxed only at distribution time many years
down the road). But there may be other complications. The employer
contribution is usually "conditional" becoming vested over time.

Accounting for a 401k is complicated.

I'm at the other end of this process. But were I using gnucash during
the money going in phase I probably would account for the 401k on a
separate set of books. Like I said, the "net worth" of a 401k depends on
lots of things like vesting and current age (can money be received
without penalty tax in addition) and even can be conditional on why
money taken out, and whether taken out or borrowed (if the plan allows
that)

Michael D Novack

Michael D Novack
_______________________________________________
gnucash-user mailing list
[hidden email]
https://lists.gnucash.org/mailman/listinfo/gnucash-user
-----
Please remember to CC this list on all your replies.
You can do this by using Reply-To-List or Reply-All.

Klaus Dahlke-2

Re: Company sponsored stock plan

On Sun, 31 Dec 2017 10:00:55 -0500
Mike or Penny Novack <[hidden email]> wrote:

> On 12/30/2017 4:39 PM, Klaus Dahlke wrote:
> > Hi Wolfgang,
> > I have modeled a comparable plan as follows: first of all, I record my salary only net. Salary is what is posted to my bank account after all deductions.
> >
> > I you don't participate in such plan, posting is straight forward, e.g.:
> > Bank <-> Income:salary -> 1000
> >
> > If you participate in the plan, a further account is helpful to show the plan contribution. Also, the amount transferred from your company to your bank is reduced by your own contribution and the taxation for companies' addition.
> Stop --- this advice depends on jurisdiction (in the US, the
> contributions if "pretax" are taxed only at distribution time many years
> down the road). But there may be other complications. The employer
> contribution is usually "conditional" becoming vested over time.
>
> Accounting for a 401k is complicated.
>

Acutally, I am not sure whether Wolfgang is engaged in a 401k plan or he just enjoyes 'share based compensation' as in my case (not unusual these days in Germany). The company shares I buy I can sell the next day I have acces to. Wolfgang mentioned reporting in Euro, so my inital guess was that it is plain 'share based compensation'.

Let's wait and see whether Wofgang gives more information.

Best regards,
Klaus
_______________________________________________
gnucash-user mailing list
[hidden email]
https://lists.gnucash.org/mailman/listinfo/gnucash-user
-----
Please remember to CC this list on all your replies.
You can do this by using Reply-To-List or Reply-All.

Mike or Penny Novack-3

Re: Company sponsored stock plan

On 1/1/2018 4:01 PM, Klaus Dahlke wrote:

>
>> Stop --- this advice depends on jurisdiction (in the US, the
>> contributions if "pretax" are taxed only at distribution time many years
>> down the road). But there may be other complications. The employer
>> contribution is usually "conditional" becoming vested over time.
>>
>> Accounting for a 401k is complicated.
>>
> Acutally, I am not sure whether Wolfgang is engaged in a 401k plan or he just enjoyes 'share based compensation' as in my case (not unusual these days in Germany). The company shares I buy I can sell the next day I have acces to. Wolfgang mentioned reporting in Euro, so my inital guess was that it is plain 'share based compensation'.
I did say "depends on jurisdiction".

And we have "share based compensation" here in the US too. And that
MAY be like you described "I can sell the next day" or maybe not (not
until a certain amount of time has passed) and there might be other
complications like given OPTIONS to purchase shares (so things like
value of option till exercised or expired -- and shares so purchased
MIGHT also have restrictions on sale attached). I suspect that at least
some of the complications I just described might exist in Europe as well
as other places.

But do note, ONE of the possibilities for 401k plans here IS
contributions of company stock. A 401k does not HAVE to offer a wide
range of investment options.

Michael

_______________________________________________
gnucash-user mailing list
[hidden email]
https://lists.gnucash.org/mailman/listinfo/gnucash-user
-----
Please remember to CC this list on all your replies.
You can do this by using Reply-To-List or Reply-All.