Replying to myself. GAAP and IFRS both seem to favour historical cost accounting.
On Tue, 16 Sept 2025, 9:39 am Christopher Lam, <[email protected]> wrote: > I can offer yet another opinion... > > I wouldn't record unrealised gains as Equity transfers. A house purchased > for $40k in 1976 would enjoy increasing values via period transfers from > equity; and if the up-to-date valuation is $800k, and you sell today, > you'll be recording a negligible capital gain. It is in my view that > appreciating assets are best recorded as purchase price and left alone > until the sale, then a large capital gain is recorded as income. > > I would however unrealised losses as periodic expenses. A car purchased > for $30k in 2020 and depreciates annually, and I may claim partially as a > tax deduction. > > IANAA of course. > > C > > > On Tue, 16 Sept 2025 at 09:02, Tom Route-36 <[email protected]> wrote: > >> Hi all, >> >> I wanted to reply to all of you here who jumped in with your advice and >> comments. I think I understand the proper way to handle this now. And >> it seems pretty simple and straightforward too thanks to all your >> feedback. To keep things recorded properly I just need to create a new >> Equity account (named Unrealized Appreciation or something similar). >> And then for each valuation change entry in my Asset account (MyHome) I >> put a corresponding entry in that new Equity account to balance things. >> Really simple now that I look back on my question. Anyway, thanks again >> to everybody. >> >> Tom >> >> >> >> On 9/15/2025 4:30 PM, David Warren wrote: >> > Most accountants will tell you to credit equity for unrealized >> appreciation >> > in your assets. >> > >> > But if you are doing your own books, it's really your choice in terms of >> > what types of reports you want to see and how you want to use. >> Sometimes I >> > credit income accounts for unrealized appreciation because it makes it >> > easier for me to track how a certain asset account has grown or shrunk >> year >> > by year and what types of income (realized, unrealized, taxable or not >> yet >> > taxed) it has thrown off. When the income is eventually realized I >> credit >> > realized income and debit unrealized income, which works for me. But >> it's >> > really a matter of how you want things to work for you. >> > >> > On Mon, Sep 15, 2025, 5:03 PM Kalpesh Patel <[email protected]> >> wrote: >> > >> >> I've done something similar. >> >> >> >> I've created a sub-account called "Appreciation" underneath the real >> estate >> >> asset holding account, and then I add the valuation transaction as >> noted in >> >> the appraisal report in "Appreciation" against "Retained Earnings" >> >> underneath "Equity". >> >> >> >> -----Original Message----- >> >> From: Murugan Mariappan <[email protected]> >> >> Sent: Monday, September 15, 2025 8:49 AM >> >> To: [email protected]; Harold Hallikainen < >> [email protected]> >> >> Subject: Re: [GNC] How to Properly Record Valuation Changes in Home >> Value? >> >> >> >> Revlaution suplus / deficit should be treated as non P&L items, so >> best way >> >> to is to create a Revaluation Account under Equity and pass the >> entries for >> >> example >> >> >> >> >> >> Dr Assets:Building (PPE) $100,000 >> >> Cr Equity: Revaluation Account $100,000 >> >> >> >> If there is a loss then it will be in the reverse for example >> >> >> >> Cr Assets:Building (PPE) $50,000 >> >> Dr Equity: Revaluation Account $50,000 >> >> >> >> >> >> >> >> Saludos Cordiales >> >> >> >> >> >> Murugan >> >> >> >> ________________________________ >> >> From: gnucash-user >> >> <[email protected]> on >> behalf of >> >> Harold Hallikainen via gnucash-user <[email protected]> >> >> Sent: 15 September 2025 00:03 >> >> To: [email protected] <[email protected]> >> >> Subject: Re: [GNC] How to Properly Record Valuation Changes in Home >> Value? >> >> >> >> I'd be tempted to have two subaccounts in the MyHome asset. These >> would be >> >> Purchase Price and Unrealized Appreciation. Then have an income account >> >> called Unrealized Income. >> >> >> >> Harold >> >> >> >> >> >> On Sun, September 14, 2025 7:57 pm, Tom Route-36 wrote: >> >>> Hi all, >> >>> >> >>> >> >>> This is more of a double entry bookkeeping question rather than >> >>> something specific to GnuCash; but I'd appreciate any input on the >> >>> proper way to do this. I'm tracking the valuation changes of my >> >>> personal home based on notices that I get every 2 years from the >> >>> County Assessor. When I was using Quicken, I did this in a single >> >>> account (named MyHome). The opening balance of MyHome was my original >> >>> purchase price. And then every 2 years as I got updated valuation >> >>> notices, I'd record a transaction back into that same MyHome account >> >>> (since Quicken would let me do that) to adjust the MyHome account >> >>> balance to make it match the current value listed on the County >> >> Assessor's >> >> notice. >> >>> >> >>> Now that I'm using GnuCash and having to do things properly with >> >>> double entry accounting, I was wondering how to go back and fix >> >>> things. I know I still want an Asset account for MyHome to track the >> >>> valuation. But for DE accounting, what should I be using for that >> >>> corresponding second account to balance things out as the valuation >> >> changes? >> >>> >> >>> Tom >> >>> _______________________________________________ >> >>> gnucash-user mailing list [email protected] To update your >> >>> subscription preferences or to unsubscribe: >> >>> 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. >> >>> >> >>> >> >> >> >> >> >> -- >> >> Not sent from an iPhone. >> >> _______________________________________________ >> >> gnucash-user mailing list >> >> [email protected] >> >> To update your subscription preferences or to unsubscribe: >> >> 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 >> >> [email protected] >> >> To update your subscription preferences or to unsubscribe: >> >> 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 >> > [email protected] >> > To update your subscription preferences or to unsubscribe: >> > 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 >> [email protected] >> To update your subscription preferences or to unsubscribe: >> 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 [email protected] To update your subscription preferences or to unsubscribe: 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.
