Vanguard brokerage account "Reinvest-Div" problem
This note is to report a problem in Vanguard's QFX data files. It was uncovered after extensive testing with Quicken and MD and several calls to Vanguard. They said they are aware of the issue and are working on it, but gave no ETA for a fix. Let me be very clear: this is a problem with Vanguard's data, not MD. However, Vanguard is a huge financial institution, and many MD users may be affected by this issue.
The problem: Vanguard Brokerage accounts do not report Dividend Reinvestments correctly after about June 17, 2009. They are reported as Dividends only -- which result in cash, but no corresponding Buy of the target security. This problem is reported to be "site-wide." In other words, it does not matter what financial software the client uses, they will get erroneous data -- ie Dividends instead of Reinvest Dividend (or Dividend+Buy).
This happens only in VG Brokerage accounts. These are special accounts VG uses to hold non-VG securities like stocks or mutual funds from other parties. If one wants to hold non-VG securities at VG, they must first set up a "normal" VG account to hold a cash equivalent, like their Vanguard Prime Money Market Fund, and then an "attached" Brokerage account can be established. The "normal" base VG accounts work perfectly and report Reinvest Dividends as they should. Only the attached Brokerage accounts exhibit the problem reported above.
VG has a special team to work with clients who are trying to use Quicken to import VG data. Consequently, I tested imports of my several VG accounts with both Quicken (Mac 2007) and MD. The results were identical -- all base VG accounts were fine, and all attached Brokerage accounts showed the error. When initially reporting the issue, the VG representative suggested it was a "Quicken on Mac" issue, but after a subsequent conference with his engineer, reported it was a "site-wide Vanguard issue."
My work-around is as follows:
1) Download VG .qfx data from all accounts as usual.
2) Reconcile non-brokerage accounts normally.
3) Examine brokerage accounts to see if the anomaly is still there
(so far, it is).
4) Manually change each "DIV" transaction to a "ReinvestDiv" This
requires getting
the info from the VG statement for that quarter, and manually
entering it.
This work-around is not to bad if one reconciles quarterly after
getting the statement for that quarter, and there aren't too many
transactions (ie you are not a trader).
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1 Posted by Oilcan on 23 Apr, 2010 03:05 AM
Thanks for sharing this information.
Vanguard's 401(K) downloads have worst problems and I elected to download a CSV file and convert it to a QIF file for import into Moneydance. I virtually had to correct every transaction (50 to 150 per month) that I downloaded from them into Quicken since my company choose them to manage our 401(k) in 2002. Now instead of spending 60 to 90 minutes per month in fixing data, my Moneydance workaround takes me about 3 minutes per month to login, extract the data, run an Excel Macro to clean up the data and then run an Excel add-in to create the QIF file.
Oilcan
2 Posted by feffer777 on 23 Apr, 2010 07:22 PM
Oilcan, could you share your method more exactly? I.E. which Excel Macro and Excel add-in (link or post, please) and how do you use them step by step. Users who have many Vanguard transactions per month/quarter would find this very useful.
Regards,
feffer777
3 Posted by Oilcan on 24 Apr, 2010 03:22 PM
Please refer to the attachment. I wrote the Excel Macro myself for my personal investment situation. I offer no support for the Macro or the Excel Add-in.
Oilcan
4 Posted by Tom Freeman on 30 Apr, 2010 03:32 AM
Thanks for this useful tip. If we get any more posts on the Vanguard problem, we can refer to this post.
Tom
5 Posted by feffer777 on 10 Jul, 2010 05:45 AM
It looks like Vanguard has fixed this issue. I just finished reconciling my accounts for the 2nd quarter, and all Vanguard brokerage accounts identified Dividend Reinvestments correctly.
It's possible new MD users could still be affected for transactions between about June 17, 2009 and April 30, 2010. I don't know whether VG corrected the issue for this period or not. But it does seem to be fixed going forward.
Incidentally, my .QFX download from VG (for this quarter) imported into MD very cleanly.
Just to be clear to MD users who pick up this thread, this issue was never a MD problem. Nevertheless, the mods here issued a bug tracking ticket for the issue so that users would be alerted to the issue. MD acted very responsibly. And VG did too. They honestly admitted to me that they had a system-wide issue and were "working on it." Having heard that line before, I wasn't holding my breath, but they seem to have corrected it in a timely fashion.
Regards,
feffer777
feffer777 closed this discussion on 10 Jul, 2010 05:46 AM.