> On Aug 8, 2017, at 12:08 PM, gc.20.reac...@neverbox.com wrote:
> I'd like to understand how one goes about recording a stock demerger
> transaction in GNU cash.
> I'd been owning X shares of a company A, which underwent a demerger, which
> resulted in all
> shareowners of company A, getting shares in Company B in the ratio of 1:1.
> So I end up
> with X shares each in both company A and B. The cost of acquisition is to
> be taken as 60:40%
> of the pre demerger cost of acquisition of company A.
> I can not record this as a split, since it involves a new company B.
> I can not record this as a transfer, since there is no change in the number
> of shares in company A
> post the demerger (Its just that the acquisition price changes). How do I
> handle this?
The normal term for this is "a spin-off".
You can use the split assistant for it. Create the new security and account
first, then do the split in the "parent" stock with the assistant. I don't
remember off hand whether you can designate a different stock for the new
shares; if you can't then just create them in the parent stock and edit the
resulting transaction so that the spun-off shares are in the new account.
You should get a letter from the parent company with the new share prices
immediately after the spin-off. Go to Tools>Price Editor and create prices for
the day of the spin-off reflecting those new share prices. Keep the letter
until n years after you sell both stocks (if you ever do) where n is the
records retention period required in your tax jurisdiction (7 years in the US).
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