No Actions in Investment Registers for Interest Income

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22 Dec, 2020 11:01 PM

Why isn't there an Action named "Interest"?

Earnings received from Bond holdings, also known as Fixed Income Securities, are called Interest, not Dividend. This deserves its own Action category, like Int, and possibly along side IntXfr, not just mingled in with MiscInc ...

This is from
Interest and dividends sound sort of like they should mean the same thing. But they don’t—and it’s important that you understand the difference.

Interest is what you earn on your money by lending it: to a company through a bond, for example, or to a bank when you buy a CD. It’s income that’s promised to you by contract, which assures that as long as you park your money for a certain amount of time, you’ll be paid a percentage. You can count on the income.

Dividends, on the other hand, are a share of profits that you get as a part owner of a company when you purchase its stock. They are your portion of the company’s earnings—if, in fact, it’s making money. You have no contract, you’re not guaranteed anything as a shareholder, and there is no expectation that the amount will stay steady or even continue being paid.

  1. 1 Posted by dwg on 23 Dec, 2020 12:35 AM

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    I'm a fellow user.

    Some programs use the "Action" field to determine the complete processing of transactions, including the category to be used.

    Moneydance does not do this, it uses the Action field to determine just how the transaction is to be processed, the category used is what you determine. This allows Moneydance to be used in various countries that have different requirements.

    On this basis Div and MiscInc are processed in an identical way. The names do not mean much, the names are ones that historically been used, there is no generic name like Inc.

    Div is used for any sort of regular income event, this name is used simply because it was the name determined by the QIF specifications.

    They could have potentially have inserted other actions but they would just be an alias.

    In short Moneydance does not need actions like Int, MargInt, CgShrt etc as Quicken has because it does not handle transactions in the same way.

  2. 2 Posted by Fred on 23 Dec, 2020 01:25 AM

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    Dear dwg,
    Thanks for your feedback.
    in short, I don’t care what Quicken or other programs do or don't. I have noted in other threads (like re Security Price Loader) that MD does not cater much to bond holders, who are relegated to use MiscInc. Bonds, aka Obligations in some countries or Fixed Income Securities, pay Interest across the world, not Dividends.
    Merry Christmas

  3. 3 Posted by dwg on 23 Dec, 2020 01:59 AM

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    Personally I could not care less what the action names are, my main concern is to have the actions available to do what needs to be done to process transactions correctly. The names I see as largely immaterial and are there to drive how the transaction is to be processed, so long as name indicates to me how a transaction is processed I find satisfactory. I do not see a lot of value in having multiple actions that all work the same way.


  4. 4 Posted by dwg on 23 Dec, 2020 02:09 AM

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    FWIW, from a user perspective, rather than what was really needed, I put a suggestion up to the Developer some time ago asking if it was possible that in the software could Alias for various action types be added.

    In other words there would be one block of code that various actions like Div, Int could all point to. Hence you would not see a blow out in redundant code that has to be maintained but just different front end names given to the same action.

  5. 5 Posted by Fred on 23 Dec, 2020 02:38 AM

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    Thank you, dwg. That would be a good & simple way - probably some time in the future …

    At this point, I would like them to spend some time on allowing users to correct the often erroneous Cost Basis. Maddy’s universal answer to use Lot rather than Average Costing rarely works.

    Stay Safe.

  6. 6 Posted by dwg on 23 Dec, 2020 03:06 AM

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    In my experience incorrect cost basis usually comes down to one of two reasons.

    1. Incorrect transactions

    2, Using transactions to mimic actions that do not exist but that do not complete mimic what the missing transaction would do. My cost basis for accounts where I have returns of capital are stuffed, I know they are correct at the total level but at a lot level they are wrong and they are wrong in the Cost Basis report.

    To delve into what is happening around cost basis in an account it would need going through each transaction and stock split to trace what is happening and what should be happening and see where it may diverge.

  7. 7 Posted by Fred on 23 Dec, 2020 05:15 AM

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    We are diverging from the Subject of this thread. Have a look here, if you like - a rather simple, documented case of one Buy, 4 splits, (and a few Sell, which have no impact on Cost Basis):
    Your evaluation & feedback is welcome. IK support has gone silent.

  8. 8 Posted by Stuart Beesley ... on 23 Dec, 2020 06:21 AM

    Stuart Beesley (Mr Toolbox)'s Avatar

    Hi Fred, for interest I use an Xfr in and assign my interest category (just like you would in a normal bank category.

    There is actually a way to adjust the cost basis, but not as you would like it. I worked with the developer a while ago to get buy/sell zero shares working. Hence if you do this with a value then it does adjust the cost basis. The intent behind this is to account for transaction types that MD does not do, like return of capital, or accumulation funds. They do work and the portfolio and gains reports too, but not the cost basis report. I also remember him saying there was a problem with splits. But you could carefully try one and see what happens.

    What version of MD are you on, these enhancements are only in later versions of the program?

    Separately, I did make some suggestions to you before but I don’t know the outcome:
    - confirm you are on lot or avg cost control on these these accounts?
    - run my extract script so we can see the actual records in case we can see a data issue
    - perhaps create new identical buy/sells and delete the old txns (I have seen corruption before). Do this by duplicating a line and deleting the old one. This may trigger a CB recalculation.
    - finally, last resort, sell all, buy again (as a fake transaction.

  9. 9 Posted by Fred on 23 Dec, 2020 05:35 PM

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    Hi Stuart,
    I am using MD 2021 (2010).

    I do not reinvest the Div, I cash out Div.

    I use avg costing, but this is immaterial, when you have only a one time purchase in the account
    The screenshot I posted for my 2 AAPL holdings are all there is, no other txn.

    For the 1999 holding it is a simple one time purchase, that is only one (1) lot, a few sales in recent years and 4 splits as noted in the Security Detail screenshot:

    06/21/00 :2
    02/28/05: 2
    06/07/14: 7
    08/31/20: 4

    The number of shares currently held is shown correctly in the Security Detail.

    I see these big cost basis discrepancies only with my AAPL holdings.

  10. 10 Posted by David Greene on 16 Mar, 2021 09:50 PM

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    This just doesn't work for me. For example, if I have excess cash in investment account, and they give me $2 in interest income, I should be able to code it as a 'deposit', credit it to 'interest income'. When I use the MiscIncome action, it keeps inserting a security,,, very frustrating. Why not a general 'Deposit' action code?

  11. 11 Posted by Stuart Beesley ... on 16 Mar, 2021 10:09 PM

    Stuart Beesley (Mr Toolbox)'s Avatar

    As I said above, you use Xfr to deposit cash coming in and set the category to interest. No security involved.

  12. 12 Posted by David Greene on 16 Mar, 2021 11:01 PM

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      I will try this again, but I could not get my category to work, nor
    could I 'outrun' the auto population of a security.

  13. 13 Posted by dwg on 17 Mar, 2021 12:18 AM

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    I'm a fellow user.

    If you select the Xfr action whatever is in the Security file will be greyed out and unselectable. This means that whatever is displayed in the field will not become part of the saved record. It is just a placeholder in the display.

  14. 14 Posted by David Greene on 17 Mar, 2021 12:27 AM

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    I lost control of the category when I did this. did not work. Defaulted
    to a misc category.

  15. 15 Posted by dwg on 17 Mar, 2021 12:46 AM

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    You should be able to change the category field value to whatever is required.

  16. 16 Posted by Ben on 19 Mar, 2021 10:26 AM

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    Surprisingly and yet entirely logically too, with a XFR action, you set the category in the Transfer field, not the greyed-out and inaccessible Category field.

  17. 17 Posted by dwg on 19 Mar, 2021 10:51 AM

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    Ah yes that was a mistake on my part.

    Investment accounts have a field called category and a field called transfer.

    Investment accounts have the ability to have two transactions in one. DivXfr being an example both recording an income event as well as a transfer event in the one transaction.

    Internally Accounts and categories are largely the same in Moneydance. In accounting they are the same and Moneydance is based on accounting principles.Having both a category field as well as a transfer field facilitates have two transactions in one.

    Hence in Moneydance in the transfer field you can select an account but you can instead select a category. When using a XFR action to record say interest, you can select the interest category in the transfer field.

  18. 18 Posted by Stuart Beesley ... on 19 Mar, 2021 11:41 AM

    Stuart Beesley (Mr Toolbox)'s Avatar

    ... and guess what. Internally.... categories are accounts. Thus, transfer field is also an account. Thus, account, category, transfer fields are actually all the same thing.....

  19. System closed this discussion on 18 Jun, 2021 11:50 AM.

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