Reorganization of Companies

George Williams's Avatar

George Williams

16 Jul, 2017 06:45 PM

Recently several of my investments went trough a reorganization where shares where delivered out and new shares of a different company were delivered in. How does one handle this as this was not a sale and purchase action.The bases of the old company became the bases for the new company. At least that is what appears on the broker statements.- Thanks- G

  1. 1 Posted by dwg on 16 Jul, 2017 09:44 PM

    dwg's Avatar

    What you have described is often call a stock for stock action or even a share swap, for "X" shares in the old company you receive "Y" shares in the new, so the action may also involve a stock split if the basis was not a 1 for 1 swap, with the historic cost basis adjusted accordingly. As you have noted this is not really a transaction it is a restructure.

    The bad news is that this is one of the missing transaction types in Moneydance, it has been requested in the past but little in the way of enhancements have been made to Investment accounts and transactions.

    While it is completely wrong, a way to handle it a sale and a purchase at historical costs.

    Another approach that may work for you is to do a stock split to set up the correct number of shares and then do some renaming of the stock involved and changing its ticker etc.

    Neither way is ideal but it is the only two approaches I can think of off the top of my head.

    Yes I have had this problem occur more than once along with some other Investment transactions that are missing.

  2. System closed this discussion on 15 Oct, 2017 09:50 PM.

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