automatic interest traction

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automatic interest traction

Nikos Charonitakis
Hi.
i have a bond that receives money from interest once a year.
My bank sends me a statement monthly that calculates interest in
arrears, till the given date i receive the statement. These money are
not cash yet.
So any ideas how i can implement  this in gnucash?

thanks in advance
Nikos
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Re: automatic interest traction

Josh Sled
"Nikos Charonitakis" <[hidden email]> writes:
> i have a bond that receives money from interest once a year.
> My bank sends me a statement monthly that calculates interest in
> arrears, till the given date i receive the statement. These money are
> not cash yet.
> So any ideas how i can implement  this in gnucash?

I might be misunderstanding, but I'm not sure what you'd like to model
... if "these money are not cash yet", then it sounds like there's no
transaction to create, right?   You're neither receiving or sending money,
just being informed of the value?


In any case, if the bond is a fixed investment with a simple interest
schedule, and – more importantly – the transactions occur on a fixed schedule
(monthly, as you say), then you should be able to create a scheduled
transaction (SX) that uses a custom function to compute the correct value.

All scheduled transactions – when instances are being created – get an
'instance number': 1, 2, 3 ... this value is bound to the variable 'i' when
the credit and debit cells for the SX are evaluated.  These credit and debit
cells can contain formulæ which reference this value to compute whatever they
like; this is how the mortgage/loan druid works, for instance.  Note that the
*date* of the instance isn't provided, so you need to frame the calculation
in terms of a particular schedule (usually monthly), but most interest
computations are done this way anyways.

In this case, you'll need a slightly different function, however, but a
straightforward one.  You can get an idea of how the function should be
implemented by looking for the file 'fin.scm' in your gnucash installation.

Once you've determined the function you need, you can put it in
~/.gnucash/config.user, or even in that same fin.scm if you want to modify
your installed sources.  ~/.gnucash/config.user is a bit safer, though.

Then, you can create a SX where the template transaction uses the formula.
Note that the "gnc:" prefix is automagically added to whatever you enter in
the template transaction.  If you

    (define (gnc:simple_compounded_interest rate instance_num principal) ...)

in your .scm file, your template transaction should simply read:

    simple_compounded_interest(0.005:i:1000)

(or whatever).  You might want to use the mortgage/loan druid on a
fake/throw-away datafile just to get an idea of the types of scheduled
transactions that it creates.


That's not the clearest procedure in the world, so let me know if you have
any questions.  Or maybe I should just document the procedure with
screen shots and get it into the docs...  in any case, feedback welcome.

--
...jsled
http://asynchronous.org/ - a=jsled; b=asynchronous.org; echo ${a}@${b}

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Re: automatic interest traction

Derek Atkins
In reply to this post by Nikos Charonitakis
"Nikos Charonitakis" <[hidden email]> writes:

> Hi.
> i have a bond that receives money from interest once a year.
> My bank sends me a statement monthly that calculates interest in
> arrears, till the given date i receive the statement. These money are
> not cash yet.
> So any ideas how i can implement  this in gnucash?

Scheduled Transaction?

> thanks in advance
> Nikos

-derek

--
       Derek Atkins, SB '93 MIT EE, SM '95 MIT Media Laboratory
       Member, MIT Student Information Processing Board  (SIPB)
       URL: http://web.mit.edu/warlord/    PP-ASEL-IA     N1NWH
       [hidden email]                        PGP key available
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Re: automatic interest traction

Nikos Charonitakis
In reply to this post by Josh Sled
On 7/5/07, Josh Sled <[hidden email]> wrote:

> "Nikos Charonitakis" <[hidden email]> writes:
> > i have a bond that receives money from interest once a year.
> > My bank sends me a statement monthly that calculates interest in
> > arrears, till the given date i receive the statement. These money are
> > not cash yet.
> > So any ideas how i can implement  this in gnucash?
>
> I might be misunderstanding, but I'm not sure what you'd like to model
> ... if "these money are not cash yet", then it sounds like there's no
> transaction to create, right?   You're neither receiving or sending money,
> just being informed of the value?

i m not receiving money, but these are money that i own and are
waiting to be received in a given date (once a year).
So its an asset of mine, if i understand it correctly (accounts receivable?)

>
>
> In any case, if the bond is a fixed investment with a simple interest
> schedule, and – more importantly – the transactions occur on a fixed schedule
> (monthly, as you say), then you should be able to create a scheduled
> transaction (SX) that uses a custom function to compute the correct value.
>
> All scheduled transactions – when instances are being created – get an
> 'instance number': 1, 2, 3 ... this value is bound to the variable 'i' when
> the credit and debit cells for the SX are evaluated.  These credit and debit
> cells can contain formulæ which reference this value to compute whatever they
> like; this is how the mortgage/loan druid works, for instance.  Note that the
> *date* of the instance isn't provided, so you need to frame the calculation
> in terms of a particular schedule (usually monthly), but most interest
> computations are done this way anyways.
>
> In this case, you'll need a slightly different function, however, but a
> straightforward one.  You can get an idea of how the function should be
> implemented by looking for the file 'fin.scm' in your gnucash installation.
>
> Once you've determined the function you need, you can put it in
> ~/.gnucash/config.user, or even in that same fin.scm if you want to modify
> your installed sources.  ~/.gnucash/config.user is a bit safer, though.
>
> Then, you can create a SX where the template transaction uses the formula.
> Note that the "gnc:" prefix is automagically added to whatever you enter in
> the template transaction.  If you
>
>     (define (gnc:simple_compounded_interest rate instance_num principal) ...)
>
> in your .scm file, your template transaction should simply read:
>
>     simple_compounded_interest(0.005:i:1000)
>
> (or whatever).  You might want to use the mortgage/loan druid on a
> fake/throw-away datafile just to get an idea of the types of scheduled
> transactions that it creates.
>
>
> That's not the clearest procedure in the world, so let me know if you have
> any questions.  Or maybe I should just document the procedure with
> screen shots and get it into the docs...  in any case, feedback welcome.
>
> --
> ...jsled
> http://asynchronous.org/ - a=jsled; b=asynchronous.org; echo ${a}@${b}
>

I was not clear enough :). I just wanted to do this through existing
gnucash accounts and tools and not create something new (i am not a
programmer... ).

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Re: automatic interest traction

Vahur Lokk
In reply to this post by Nikos Charonitakis
Nikos Charonitakis wrote:
> Hi.
> i have a bond that receives money from interest once a year.
> My bank sends me a statement monthly that calculates interest in
> arrears, till the given date i receive the statement. These money are
> not cash yet.
> So any ideas how i can implement  this in gnucash?
>
>  
It depends on what is the status of the calculated interest.

If its actually your money - i.e if you sell the bond early, you will
get face value plus this calculated interest, then you can 1. create an
asset account "Accumulated interest" 2. create income account "Interest
income" (though you probably have it already) and then 3. create a
monthly transfer between "Accumulated interest" and "Interest income" in
the amount that has accumulated during the month based on your bank
statement.

If its not actually your money, i.e. its there on the banks statement,
saying basically: "if you hold this bond till next interest day, THEN
AND ONLY THEN we pay this out to you", then there's nothing you can do -
from accounting point of view.

Wahur

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Re: automatic interest traction

Vahur Lokk
Vahur Lokk wrote:

> Nikos Charonitakis wrote:
>> So any ideas how i can implement  this in gnucash?  
> It depends on what is the status of the calculated interest.
>
> If its actually your money - i.e if you sell the bond early, you will
> get face value plus this calculated interest, then you can 1. create an
> asset account "Accumulated interest" 2. create income account "Interest
> income" (though you probably have it already) and then 3. create a
> monthly transfer between "Accumulated interest" and "Interest income" in
> the amount that has accumulated during the month based on your bank
> statement.
Oh, and I forgot most important and pleasant part - when they actually
pay you then you transfer the interest from "Accumulated interest" to
"Bank account". :)
Of course, all of this can be scheduled to your hearts content, but I
have found that unless question is about regular fixed amount, all those
fancy druids, wizards, sages, witches, priests and tooth fairies can
burn in hell.

Wahur
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Re: automatic interest traction

Nikos Charonitakis
In reply to this post by Vahur Lokk
On 7/5/07, Vahur Lokk <[hidden email]> wrote:

> Nikos Charonitakis wrote:
> > Hi.
> > i have a bond that receives money from interest once a year.
> > My bank sends me a statement monthly that calculates interest in
> > arrears, till the given date i receive the statement. These money are
> > not cash yet.
> > So any ideas how i can implement  this in gnucash?
> >
> >
> It depends on what is the status of the calculated interest.
>
> If its actually your money - i.e if you sell the bond early, you will
> get face value plus this calculated interest, then you can 1. create an
> asset account "Accumulated interest" 2. create income account "Interest
> income" (though you probably have it already) and then 3. create a
> monthly transfer between "Accumulated interest" and "Interest income" in
> the amount that has accumulated during the month based on your bank
> statement.
this is the case :)
All these can be done automatically? I want gnucash to calculate
automatically (based on the interest rate of the bond) the amount of
money that have to go to "Accumulated interest" account (once a month
for example) and then when i actually take the money to do the
appropriate transactions a) move money to bank account and interest
income account

Nikos
>
> If its not actually your money, i.e. its there on the banks statement,
> saying basically: "if you hold this bond till next interest day, THEN
> AND ONLY THEN we pay this out to you", then there's nothing you can do -
> from accounting point of view.
>
> Wahur
>
>
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Re: automatic interest traction

Vahur Lokk
Nikos Charonitakis wrote:
> and then when i actually take the money to do the
> appropriate transactions a) move money to bank account and interest
> income account
No-no. It goes to income account immediately - first thing you wanna do
is to record it as an asset (in "Accumulated interest") but this asset
has to come from somewhere - either from income or liabilities, in your
case its obviously income. When it is actually paid out, you transfer it
simply from one asset account (accumulated interest) to another (bank
account).

As to scheduling, see my other mail, but YMMV. It may work out fine, but
I have found it way more reliable to do the math myself or get the
numbers from bank statement - and this has nothing to do with gnucash :)

Wahur, stinky conservative, when it comes to accounting
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